MEA Region Scores 26% In Energy Transition Readiness Index

MEA Region Scores 26% In Energy Transition Readiness Index

MEA Energy Transition Readiness Index highlights the region’s potential as an exporter of green hydrogen

Siemens Energy and global management consultancy Roland Berger launched on Thursday the Energy Transition Readiness Index for the Middle East and Africa region.

Responses from around 400 energy industry experts, who attended the MEA Energy Week conference last month, indicate that the region is well positioned to become a major future supplier of sustainable energy to global markets.

However, MEA region will require stabilizing regulations, significant investments, and a substantial increase in collaboration to realize its potential, the index stated.

Despite its strong prospects to become a hotspot for sustainable energy, the region scored only 26% on the Readiness Index.

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Experts and decision makers from the Middle East and Africa from across the energy sector were asked to give their expert opinion on progress on 11 energy priorities.

Based on an aggregate of participants' responses, Siemens Energy and conference knowledge partner Roland Berger launched the index which describes the perceived energy transition readiness on a scale of 0 to 100%.

The survey yielded valuable data and insights that will be used to enhance key strategies for the energy transition in the region.

The conference participants view green hydrogen’s potential aligned with the region's capabilities – in particular due to the availability of abundant and low-cost renewables, existing export infrastructure and financing resources.

The report also highlighted a worrying gap between perceptions and reality when it comes to progress on the energy transition.

Conference participants on average estimated that the region's emissions fell by 23% between 2005 and today, with only around one-third correctly identifying that emissions have not fallen at all. In fact, emissions grew by around 50% between 2005 and 2021.

In the Middle East this increase was driven by heavy reliance on oil and gas and high standards of living. In Africa the drivers include population growth, underdeveloped infrastructure and limited options for financing sustainable solutions.

The region makes a relatively modest contribution to global emissions, with 7% of global CO2 emissions stemming from the Middle East and just 4% attributable to Africa.

However, it suffers disproportionately from the consequences of climate change in the form of heatwaves and severe weather events.

The gap between perceptions and reality filtered through to participants’ expectations for future emissions cutting.

The survey found that participants were expecting emissions to fall to 39% of their 2005 level by 2030; a widely optimistic view given the little that has been achieved so far.

“The disparity between the reality of the energy transition and perception in the Middle East and Africa highlights the eagerness of governments and companies to portray their successes when it comes to decarbonization,” said Karim Amin, Executive Board Member, Siemens Energy.

The United Arab Emirates has already announced its ambition to capture 25% of the global market for hydrogen, while Saudi Arabia aims to become the world's No. 1 supplier.

A total of 46 green hydrogen projects are already underway in the Middle East and Africa, with Oman (11 projects), the United Arab Emirates (9) and Egypt (7) leading the way.

“The Middle East can play a key role in addressing the new priorities of Europe’s energy transition, through the export of green hydrogen,” said Pierre Samaties, Partner at global management consultancy Roland Berger.

Hydrogen could also be the key to decarbonizing the region's economies, which are currently strongly focused on fossil fuels, and to decreasing today's reliance on income from fossil fuels, especially in countries such as Saudi Arabia, the United Arab Emirates and Oman.

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