Energy

Nearly three years on, Russia’s full-scale invasion of Ukraine in February 2022 has reshaped trade and investment in the energy sector, leading to an increase in Gulf imports of Russian oil and a sharp rise in the region’s hydrocarbon exports to Europe as well as further fueling the growth of Gulf investment in renewable energy projects located in and targeting the continent.

The Middle East and North Africa has the potential to become the world’s largest renewable energy-producing region. Compared to the immense scale of its resources, renewable energy is virtually untapped at present. This study maps the emerging regional trends in renewable energy development and MENA renewable energy supply chains across North Africa, the Arabian Peninsula, and the Levant. The most successful MENA nations in developing their renewable energy resources to date are doing so through the establishment of green energy ecosystems, in which the development of utility-scale renewable energy infrastructure is coordinated with that of robust offtake markets and the establishment of commercially viable storage and transportation mechanisms to service them.

Morocco is a regional leader in renewable energy development. The country’s success stems from its multi-faceted green energy ecosystem that is giving rise to international renewable energy export supply chains based on production of green hydrogen, in the form of green am-monia, as well as phosphates, other minerals and metals, fertilizers, agri-food products, and electric vehicles. As rising green industrial manufacturing and green agricultural production are becoming drivers of long-term, private sector employment, a synergy is emerging between Mo-rocco’s efforts to expand its already significant renewable energy sector and its objective of in-creasing the number of women and young people engaged in formal employment.

Within the next 25 years, the Middle East and North Africa will be a global leader in renewable energy production and a hub for international renewable energy supply chains. Morocco, the UAE, and Jordan are spearheading the regional trend to develop green energy ecosystems in which renewable energy is used, in part or entirely, to power the manufacture of intermediate and finished goods for export.

There is currently a discrepancy between the strategic objectives and enabling conditions for solar power in the Gulf and the level of actual deployment. Despite the region’s considerable promise as a potential global leaders in solar power, including one of the world’s highest levels of solar irradiance and strong supporting operating conditions, renewable power accounted for only 2% of generation capacity in 2022.

The hydrocarbon-rich Gulf states are located in the heart of the global sunbelt, endowing them with some of the greatest solar resources in the world. Peak load hours in these countries also align well with daily and seasonal solar radiation levels. Nevertheless, actual deployment of renewable power, including solar, is among the lowest in the world, even though output has increased significantly over the past five years. This paper analyzes why solar power has seen some success in a few states, while in others there has been little momentum.

The Middle East and North Africa is typically viewed from afar as a region of major energy exporters rather than consumers. Consumption patterns vary significantly within the region itself, but a variety of factors warrant giving its energy demand much closer attention than it generally receives on an international level. The range of factors that will determine the changes in demand from every country in the region, each with their respective intricacies, are far too numerous to examine in the space of this study. However, many of the key drivers that are expected to have a broad impact on shaping the evolution of regional demand to the end of the current decade deserve critical review.

The MENA region is set to experience substantial growth in demand for energy during the remaining years of the present decade. Factors driving this growth vary enormously by sub-region and individual country, but there are broad similarities in the forms of both primary and final energy demand growth that are expected to materialize by 2030.

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A leader in renewable energy in the Middle East and North Africa, Morocco is developing a dynamic green energy ecosystem that is beginning to incorporate renewable power into major sectors of its economy. Moving forward, renewable energy and the green energy ecosystem hold significant potential to drive the creation of employment opportunities for its growing population. Indeed, the expansion of green industrial manufacturing and agricultural production in Morocco could become the engine of sustainable human development more broadly. This case study explores current and planned efforts to expand the kingdom’s renewable energy sector and green energy ecosystem, assessing the opportunities and challenges in using these new green industries as a driver of long-term employment, particularly among women, youth, and rural populations.

A cycle of retaliation against energy assets, though far from a guaranteed outcome, would be to the detriment of all and the benefit of none.