Energy Management in the Middle East

Managing and reducing energy consumption not only saves money but also helps in mitigating climate change and enhancing corporate reputation. The primary objective of energy management is to achieve and maintain optimum energy procurement and utilisation, throughout the organisation which may help in minimizing energy costs and mitigating environmental effects. Infact, energy management is widely acknowledged as the best solution for direct and immediate reduction of energy consumption.

Energy efficency is still not a priority in the industrial sector in Arab world

Importance of Energy Management

Energy should be regarded as a business cost, like raw material or labour. Companies can achieve substantial reduction in energy bills by implementing simple housekeeping measures. Reduction and control of energy usage is vital for an organization as it:

• Reduces costs: Reducing cost is the most compelling reason for saving energy. Most organisations can save up to 20% on their fuel cost by managing their energy use;
• Reduces carbon emissions: Reducing energy consumption also reduces carbon emissions and adverse environmental effects. Reducing your organisation’s carbon footprint helps build a ‘green’ image thereby generating good business opportunities; and
• Reduce risk: Reducing energy use helps reduce risk of energy price fluctuations and supply shortages.

Regulatory requirements aiming to reduce carbon emissions and energy use require accurate energy data collection and effective management systems. Good energy management practices are compliant with these requirements and help fulfil regulatory obligations. Businesses worldwide are showing interest in appointment of a formal/informal energy manager to coordinate energy management activities. The main task of an energy manager is to set up a system to collect, analyse and report on energy consumption and costs which may involve reading electricity meters regularly and analysis of utility bills.

Carbon emissions from energy use dominate the total greenhouse gas emissions of most organisations. Sound energy management is rapidly emerging as an integral part of carbon management which in turn helps organisations in effective overall environmental management. In addition to financial benefits, energy management has other significant advantages for an organisation such as:

• Organisations achieve stronger market position by demonstrating ‘green’ credentials. Energy management improves competitive advantage as most consumers prefer to source from socially responsible businesses;
• Organisations adopting energy management systems can influence supply chains by preferring suppliers who adopt environment management practices; and
• Energy management creates a better workplace environment for employees by improving working conditions.

Energy Management in the Middle East

In recent years, energy consumption in the Middle East is rising exponentially due to rapid industrialization and high population growth rate. Infact, the level of primary energy consumption in MENA region is one of the highest worldwide.  However, the efficiency of energy production and consumption patterns in the region requires improvement. Though the per capita energy consumption in the GCC sub-region are among the world’s top list, more than 40 percent of the Arab population in rural and urban poor areas do not have adequate access to energy services.

The Middle East is making a steady change towards energy efficiency and alternative sources of energy. Several declarations have been issued in recent years emphasizing concerns and commitment of regional powers to achieve sustainable development. Energy Strategy 2030 introduced by Dubai aims to reduce energy demand and carbon dioxide emissions by 30% by the year 2030 through secure energy supply and efficient energy use while meeting environmental and sustainability objectives. Similarly, Saudi Arabia and Qatar are seriously pursuing the use of alternative energy in power generation. This is an attractive driver for businesses to adopt solutions that reduce overall energy consumption. 

Considering the rapid rise in power demand in the region, governments are now looking to diversify their energy mix from their primary energy source to a greater reliance on renewable energy. Middle East energy efficiency ranking is expected to get a major boost due to the development of large renewable energy projects in UAE, Saudi Arabia, Jordan etc. Balanced approaches are being employed to drive feasible clean energy projects while developing the regulatory framework and adaptation of energy efficient technologies.

Many businesses in the Middle East have set dynamic strategic direction to achieve immediate reduction in energy consumption. The trend towards energy efficiency will only continue to grow to sustain this demand. With increasing environmental awareness, there is significant room for growth and leadership within the Middle East for the adoption of energy optimisation, introduction of specialised energy-saving systems and implementation of sustainable energy technologies.