UAE and Mena invest in green energy, but face a long road ahead (page 1 of 2)

The green energy boom has peppered the media with a string of announcements and claims of sustainable solutions for a largely oil rich region, with oil and non-oil-based economies making moves to deploy renewable energy into their power mix.

Matthew Taiwo of Carter Croft, a renewable energy consultancy, spoke to AMEinfo.com about the rapid expansion of the Middle East renewable energy sector in recent years:
"From the ground up, companies have been hiring key members of the renewable energy industry to head up projects, especially in the Solar and Wind energy sectors. I have read a lot about a 'mirage of spending' in the Middle East but the reality is that the money really is being spent, hence the physical presence of some of the leading businesses and individuals from within the renewables industry."

What some Middle East nations do have in abundance is capital, but spending alone is not a sure-fire guarantee of success. Taiwo points to talent, among other issues, as a holdback for new regional projects: "This doesn't mean that the Middle East is the golden egg for international renewables businesses - it offers a multitude of challenges such as ROI, Staffing issues, grid connectivity etc. There has been a shortage of key leadership talent in the region, hence sourcing leading UK and European C and D-level individuals and relocating them to the area."
A second resource, aside from wealth, is the vast expanse of land to develop large-scale renewable projects, in comparison with more crowded Western countries.

"Most Western countries are so far down the renewables line that barriers to entry are huge coupled with significant shortage of usable land - not so in the Middle East. Secondly, many oil companies have backed renewables projects currently in progress as part of their corporate social responsibility programmes. It makes sense to put money back into the countries that you produce oil from," adds Taiwo.

Is green energy a reliable alternative to fossil fuels?

BP's latest figures, running until the end of 2010, show the Middle East as having 54% of the world's oil reserves and 40.5% of all natural gas. However, the region's renewable energy supplies are currently listed as 0.05% of the world's share, despite available space and capital for solar projects and other such initiatives.

India, China and Latin America are ahead of the pack, offering the lion's share of opportunity for green energy companies. And, prior to the global economic downturn, European governments had eagerly ploughed investment into renewable energy projects, to find viable alternatives to fossil fuels and appease emission targets. Projects have since slowed as prolific spending becomes harder to justify.

The current output from Middle East renewable energy sources will hardly make a dent in the rising demand seen in the region, so while technologies improve and investments take effect, reliance will remain on the region's oil. Resource figures for Middle East oil have been debated for some time and speculation as to the real size of reserves has begun 'in earnest' the Carter Croft senior partner says, stating:
"It would seem prudent that, should reserve sizes have been incorrectly awarded, a renewable energy program 15-20 years ahead of being needed would make sense."

Aside from the problem of sustainability, where the debate surrounds how many more years we can extract limited resources from often hard to reach places, logistics is an enduring issue. The infrastructure for oil and gas, though long established, is currently overshadowed by geo-political tensions surrounding Iran.