UAE’s Electricity Demand To Exceed 40,000MW By 2020

Gulf countries are seeing a steep energy demand owing to a growing population and subsidised resources.



The UAE’s demand for power will grow by nine per cent to exceed 40,000 megawatts by 2020, according to the country’s energy minister.

Speaking at the New Nuclear International Conference, Suhail Bin Mohammed Faraj Faris Al Mazrouei, UAE’s Minister of Energy, said that the UAE’s average energy consumption rate is three times that of international standards.

The Gulf region is seeing a steep growth in energy demand owing to its burgeoning population and increasing industrial demand. This has resulted in a call for change in energy policies across the GCC states to foster sustainable production.

Earlier this week, Oman’s oil and gas minister criticised the subsidised petrol and electricity programmes across the Gulf that is leading to wastage of electricity in the region.

According to a report by British think tank Chatham House, the GCC consumes more primary energy than the whole of Africa despite its population being only one-twentieth the size of the continent’s.

Heavily subsidised energy has also fuelled consumption growth in the region, causing energy subsidy bills for the GCC governments to shoot up.

The International Monetary Fund (IMF) estimated that energy subsidy costs in some of the Gulf countries were as high as 28 per cent of government revenues in 2011.

The surging demand for energy across the region has put pressure on governments to spend heavily in the next decade just to meet their own energy needs.

According to a recent study by consultants IHS, over $1 trillion of investment is needed in the next 17 years to meet the energy demands in MENA.

IHS estimates that demand for natural gas in the GCC is likely to rise more than 50 per cent, from 256 billion cubic metres (bcm) in 2011 to 400 bcm in 2030. Oil demand will also grow more than 50 per cent in the next 17 years, from around four million barrels per day to over 6.2 million bpd, IHS said.