Carbon Market in the Middle East

Map of commonly included MENA (Middle East & N...
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The Middle East and North Africa (MENA) region is highly susceptible to climate change, on account of its water scarcity, high dependence on climate-sensitive agriculture, concentration of population and economic activity in urban coastal zones, and the presence of conflict-affected areas. Moreover, the region is one of the biggest contributors to greenhouse gas emissions on account of its thriving oil and gas industry.

The world’s dependence on Middle East energy resources has caused the region to have some of the largest carbon footprints per capita worldwide. Not surprisingly, the carbon emissions from UAE are approximately 55 tons per capita, which is more than double the US per capita footprint of 22 tons per year. The MENA region is now gearing up to meet the challenge of global warming, as with the rapid growth of the carbon market. During the last few years, many MENA countries, like UAE, Qatar, Egypt and Saudi Arabia have unveiled multi-billion dollar investment plans in the cleantech sector to portray a ‘green’ image.

There is an urgent need to foster sustainable energy systems, diversify energy sources, and implement energy efficiency measures. The clean development mechanism (CDM), under the Kyoto Protocol, is one of the most important tools to support renewable energy and energy efficiency initiatives in the MENA countries. Some MENA countries have already launched ambitious sustainable energy programs while others are beginning to recognize the need to adopt improved standards of energy efficiency.

 The UAE, cognizant of its role as a major contributor to climate change, has launched several ambitious governmental initiatives aimed at reducing emissions by approximately 40 percent. Masdar, a $15 billion future energy company, will leverage the funds to produce a clean energy portfolio, which will then invest in clean energy technology across the Middle East and North African region. Egypt is the regional CDM leader with twelve projects in the UNFCCC pipeline and many more in the conceptualization phase.

The MENA region is an attractive CDM destination as it is rich in renewable energy resources and has a robust oil and gas industry. Surprisingly, very few CDM projects are taking place in MENA countries with only 22 CDM projects have been registered to date. The region accounts for only 1.5 percent of global CDM projects and only two percent of emission reduction credits. The two main challenges facing many of these projects are: weak capacity in most MENA countries for identifying, developing and implementing carbon finance projects and securing underlying finance.

Currently, there are several CDM projects in progress in Egypt, Jordan, Bahrain, Morocco, Syria and Tunisia. Many companies and consulting firms have begun to explore this now fast-developing field. One of them, the UK-based EcoSecurities, opened a regional office in Dubai. The company has offices in Bahrain and Lebanon and is planning for branches in Saudi Arabia and Qatar as well as intermediates in Egypt and Libya next year. The Masdar Company of Abu Dhabi, meanwhile, is the first local company in the region to pursue a CDM project.

The Al-Shaheen project is the first of its kind in the region and third CDM project in the petroleum industry worldwide. The Al-Shaheen oilfield has flared the associated gas since the oilfield began operations in 1994. Prior to the project activity, the facilities used 125 tons per day (tpd) of associated gas for power and heat generation, and the remaining 4,100 tpd was flared. Under the current project, total gas production after the completion of the project activity is 5,000 tpd with 2,800-3,400 tpd to be exported to Qatar Petroleum (QP); 680 tpd for on-site consumption, and only 900 tpd still to be flared. The project activity will reduce GHG emissions by approximately 2.5 million tCO2 per year and approximately 17 million tCO2 during the initial seven-year crediting period.

Potential CDM projects that can be implemented in the region may come from varied areas like sustainable energy, energy efficiency, waste management, landfill gas capture, industrial processes, biogas technology and carbon flaring. For example, the energy efficiency CDM projects in the oil and gas industry, can save millions of dollars and reduce tons of CO2 emissions. In addition, renewable energy, particularly solar and wind, holds great potential for the region, similar to biomass in Asia.

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Salman Zafar’s Articles in ISER

Renewable energy in South Africa

Issue 4 2010 / 13 December 2010 / Salman Zafar, Renewable Energy Advisor

South Africa, the most industrialised country in Africa, has a population of approximately 50 million living on a land area of 1.2 million km2. The country has large reserves of coal and uranium, and small reserves of crude oil and natural gas. Coal provides 75% of the fossil fuel demand and accounts for 91% of electricity generation. South Africa is enjoying sustained GDP growth of approximately 5% per annum. (more…)

Renewable Energy in Jordan

Issue 3 2010 / 14 October 2010 / Salman Zafar, Renewable Energy Advisor

The Hashemite Kingdom of Jordan is heavily dependent on oil imports from neighbouring countries to meet its energy requirements. The huge cost associated with energy imports creates a financial burden on the national economy and Jordan had to spend almost 20% of its GDP on the purchase of energy in 2008. Electricity demand is growing rapidly, and the Jordanian Government has been seeking ways to attract foreign investment to fund additional capacity. In 2008, the demand for electricity in Jordan was 2,260 MW, which is expected to rise to 5,770 MW by 2020. Therefore, provision of reliable and clean energy supply will play a vital role in Jordan’s economic growth.

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Biomass energy resources in the MENA region

Issue 4 2009Past issues / 22 December 2009 / Salman Zafar, Renewable Energy Advisor

The high volatility in oil prices in the recent past and the resulting turbulence in energy markets has compelled many MENA countries, especially the non-oil producers, to look for alternate sources of energy, for both economic and environmental reasons. The significance of renewable energy has been increasing rapidly worldwide due to its potential to mitigate climate change, to foster sustainable development in poor communities and augment energy security and supply.

The major biomass producing MENA countries are Sudan, Egypt, Algeria, Yemen, Iraq, Syria and Jordan. Traditionally, biomass energy has been widely used in rural areas for domestic purposes in the MENA region. Since most of the region is arid/semi-arid, the biomass energy potential is mainly contributed by municipal solid wastes, agricultural residues and agro-industrial wastes.

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Biomass Resources in Middle East and North Africa (MENA)

The major biomass producing MENA countries are Sudan, Egypt, Algeria, Yemen, Iraq, Syria and Jordan. Traditionally, biomass energy has been widely used in rural areas for domestic purposes in the MENA region. Since most of the region is arid/semi-arid, the biomass energy potential is mainly contributed by municipal solid wastes, agricultural residues and agro-industrial wastes.

Municipal solid wastes represent the best source of biomass in MENA countries. The high rate of population growth, urbanization and economic expansion in MENA region is not only accelerating consumption rates but also accelerating the generation of municipal waste.

The food industry in MENA produces a large number of organic residues and by-products that can be used as biomass energy sources. In recent decades, the fast-growing food and beverage processing industry has remarkably increased in importance in major countries in the region.

The Middle Eastern countries have strong animal population. The livestock sector, in particular sheep and goats, plays an important role in the national economy of the MENA countries. Agriculture plays an important role in the economies of most of the countries in the Middle East and North Africa. Crop residues encompasses all agricultural wastes such as bagasse, straw, stem, stalk, leaves, husk, shell, peel, pulp, stubble, etc.

Waste-to-Energy in the Middle East

The high volatility in oil prices in the recent past and the resulting turbulence in energy markets has compelled many MENA countries, especially the non-oil producers, to look for alternate sources of energy, for both economic and environmental reasons. The significance of renewable energy has been increasing rapidly worldwide due to its potential to mitigate climate change, to foster sustainable development in poor communities, and augment energy security and supply.

The Middle East is well-poised for waste-to-energy development, with its rich feedstock base in the form of municipal solid wastes, crop residues and agro-industrial wastes. The high rate of population growth, urbanization and economic expansion in the Middle East is not only accelerating consumption rates but also accelerating the generation of a wide variety of waste. Bahrain, Saudi Arabia, UAE, Qatar and Kuwait rank in the top-ten worldwide in terms of per capita waste generation. The gross urban waste generation quantity from Arab countries is estimated at more than 80 million tons annually. Open dumping is the most prevalent mode of municipal solid waste disposal in most countries.

Waste-to-energy technologies hold the potential to create renewable energy from waste matter, including municipal solid waste, industrial waste, agricultural waste, and industrial byproducts. Besides recovery of substantial energy, these technologies can lead to a substantial reduction in the overall waste quantities requiring final disposal, which can be better managed for safe disposal in a controlled manner. Waste-to-energy systems can contribute substantially to GHG mitigation through both reductions of fossil carbon emissions and long-term storage of carbon in biomass wastes. Modern waste-to-energy systems options offer significant, cost-effective and perpetual opportunities for greenhouse gas emission reductions. Additional benefits offered are employment creation in rural areas, reduction of a country’s dependency on imported energy carriers (and the related improvement of the balance of trade), better waste control, and potentially benign effects with regard to biodiversity, desertification, recreational value, etc. In summary, waste-to-energy can significantly contribute to sustainable development both in developed and less developed countries. Waste-to-energy is not only a solution to reduce the volume of waste that is and provide a supplemental energy source, but also yields a number of social benefits that cannot easily be quantified.

Biomass wastes can be efficiently converted into energy and fuels by biochemical and thermal conversion technologies, such as anaerobic digestion, gasification and pyrolysis. Waste-to-energy technologies hold the potential to create renewable energy from waste matter.  The implementation of waste-to-energy technologies as a method for safe disposal of solid and liquid biomass wastes, and as an attractive option to generate heat, power and fuels, can significantly reduce environmental impacts of wastes. In fact, energy recovery from MSW is rapidly gaining worldwide recognition as the fourth ‘R’ in sustainable waste management system – Reuse, Reduce, Recycle and Recover. A transition from conventional waste management system to one based on sustainable practices is necessary to address environmental concerns and to foster sustainable development in the region.

Renewable Energy in Jordan

Jordan has been the leader in the development of renewable energy systems in the Middle East, with its tremendous renewable energy potential in the form of wind, solar, biomass and waste-to-energy. Renewable energy accounted for about 2% of the energy consumption in 2009, and the country has set ambitious targets to raise this share to 7% in 2015 and 10% in 2020. To achieve these figures, more than 1200MW of renewable energy projects are expected to be implemented in the coming decade, with emphasis on solar and wind energy. Jordan will require investments in the range of USD 1.4 – 2.1 billion within the next 10 years to realize its clean energy potential. The Government of Jordan has pledged its full support to the developmental initiatives in the renewable energy and energy efficiency sector through continuous cooperation with international partners, donors and private investors.

For full access to the Jordan country report, please contact the author at salman@bioenergyconsult.com