Middle East Power & Energy Outlook, 2022

Strong Growth in Electricity Demand and Supply Security Drive the Industry While Decarbonization and Expanding Markets Propel Power Investments

Globally, the Middle East (ME) is one of the regions most vulnerable to climate change. Nearly every ME country has been subjected to some of the lowest precipitation levels historically, and hotter climatic conditions will lead to a surge in demand for electricity to power regional cooling requirements. In fact, cooling already accounts for 70% of residential power demand. An increase in temperature will exacerbate the ME’s desalination and cooling requirements. Energy-efficiency needs are equally strong across the region where citizens have thrived on energy subsidies and some of the lowest electricity prices in the world. These issues coupled with volatile hydrocarbon prices have led to what is now being called the Energy Transition era in the Middle East.

Economic diversification features on most vision agendas of Gulf Cooperation Council countries to insulate themselves from volatile oil prices and to transition to an industrial economy that will achieve growth from non-oil exports. Further, the onus to reduce carbon emissions has fallen on the region; therefore, ME countries have ambitious targets to promote renewable sources of power. Decarbonization represents a subject gaining unparalleled levels of attention and importance in the ME.

Another trend is the major shift towards natural gas-fired power plants, a move away from other fossil fuel-based power generation sources, and phenomenal growth in capacity additions of renewable power generation assets, with solar PV dominating.

Opportunities abound with net capacity additions of more than 185.46 GW in the pipeline, easy access to financing renewable projects, and several incentives earmarked to attract foreign investments.

Research Highlights

This outlook captures key highlights of 2021 and what the analyst expects from the sector in 2022, based on major industry trends observed in the past few years those that will continue going forward. The report also explores avenues for investment available for industry participants in the ME that result from this major effort towards decarbonization and managing evolving power demand.

Key Issues Addressed

• What is the installed capacity of power generation assets in the region, and what is the total market revenue potential?
• What are the major trends impacting the regional energy industry?
• What are the growth opportunities available for new entrants and existing players?
• What is the market revenue potential in prominent countries of the region?