New Report Highlights Renewables as Climate Mitigation and Economic Diversification Opportunity for Gulf Countries
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GCC countries can maintain a key role in global energy markets by exploiting their cost-effective renewable potential, spurring investment, and expanding innovation.
Dubai, United Arab Emirates, 6 December 2023 – Today, the International Renewable Energy Agency (IRENA) unveiled a report on the progress of renewable energy in countries of the Gulf Cooperation Council (GCC).
Renewable Energy Markets: GCC 2023 suggests that GCC countries can leverage existing resources to develop innovative renewable energy-based solutions not only to mitigate climate change, but also to diversify their economies, create jobs, and reduce environmental impacts of the energy sector.
As COP28 is underway in the heart of the GCC, this report serves as a resource and reference point for policy makers, businesses and civil society in harnessing the region’s vast renewable resource potential.
At less than US cents 2 per kilowatt hour (kWh), solar PV is now the least-cost option for power production in the GCC, outpacing natural gas, liquefied natural gas, oil, coal and nuclear power. Plummeting generation costs and abundant solar and wind resources in the region open the door for innovative energy technologies, such as green hydrogen, to be produced competitively.
“As the world ushers in a new energy era, the GCC region has a unique opportunity to maintain a leading role in the global energy market,” said IRENA Director General Francesco La Camera. “Momentum in the region builds, as GCC states develop increasingly ambitious renewable energy and hydrogen strategies and pursue the implementation of their net-zero commitments.”
“Renewables are now cost-effective in the GCC, with highly successful auctions resulting in world-record-low prices for solar. This is boosting the economic case and paves the way for the introduction of high shares of renewables in the electricity mix. Further sustained action is needed to translate ambitious targets into delivery on the ground.”
The report underscores a significant increase in the GCC’s installed renewable power capacity, from 176 megawatts in 2013 to over 5.6 gigawatts in 2022. However, renewables still only account for a negligible amount of the region’s electricity capacity, while end-uses continue to rely on fossil fuels.
Public investments in infrastructure and in value chains can further drive and enable the deployment of renewable energy and associated benefits, the report finds. It emphasises building on existing energy infrastructure, including enhancing regional grid interconnections and developing infrastructure to support end uses of renewables, for example in transport.
The GCC countries need to play a larger role in achieving global targets, both domestically and internationally. Beyond national efforts, GCC countries are in a position to support the energy transition in developing countries through international collaborative investments in renewable energy.
