MENA to Emerge as Global Renewable Energy Leader

The MENA region is making significant strides in its transition to renewable energy, focusing on developing clean energy ecosystems, hydrogen production, and value-added exports, according to research by the Middle East Institute (MEI).

The study highlights the UAE’s substantial investments in clean energy, having committed USD 40 billion in initiatives, including USD 16.8 billion across 70 countries. The UAE has set an ambitious target to achieve 44 percent renewable power by 2050 and aims to capture 25 percent of the global hydrogen market by 2030. This includes producing 1 million tons of hydrogen annually, with 700,000 tons earmarked for export. The UAE is also leading the charge in green aluminum production, solar-powered electric vehicle manufacturing, and a rapidly growing battery metals recycling industry.

Saudi Arabia is working towards generating 50 percent of its power from renewable sources by 2030, which represents a 20-fold increase over its 2023 levels. The kingdom is making significant investments in blue and green ammonia production, alongside expanding its mineral and metal processing capabilities to support domestic electric vehicle (EV) manufacturing and green steel production.

Qatar has set a goal to generate 30 percent of its power from renewable energy by 2030. The country is focused on reducing the carbon footprint of its liquefied natural gas (LNG) production, although it has yet to establish a clear green hydrogen development strategy despite prioritizing blue ammonia.

Oman is channeling USD 45 billion into green hydrogen and ammonia projects, with plans to produce 1 million tons of green hydrogen by 2030 and 8.5 million tons by 2050. Oman is leveraging its strategic ports for export opportunities to Asia and Europe, although infrastructure development remains a critical challenge.

Kuwait has recently reignited its renewable energy ambitions, issuing a tender for a solar power plant in January 2024. While the country lacks large-scale renewable energy infrastructure, it is working on reducing the carbon footprint of its oil production and investing in green energy projects abroad.

Jordan, a leader in renewable energy in the Levant, had 27 percent of its installed capacity from renewables in 2023 and is targeting 50 percent by 2030. The country plans to produce up to 2.35 million tons of green hydrogen annually, with export opportunities to Europe and Asia. Jordan is also focusing on solar-powered desalination projects and developing regional power interconnectors.

In North Africa, Morocco leads the renewable energy charge, aiming to achieve 52 percent renewable power by 2030. The country is focusing on green ammonia production, electric vehicle manufacturing, and green steel production. Morocco’s phosphate giant, OCP, is transitioning to green ammonia, with plans to export between 1 and 3 million tons annually.

Egypt aims to generate 42 percent of its power from renewable energy by 2035, although recent economic challenges have slowed progress. The country is developing a green energy ecosystem that links renewable energy production to ammonia production for export, which could significantly boost the country's renewable energy market share. Sudan, with abundant renewable resources, could attract investment in solar and wind power, specifically in green ammonia production.

Algeria, which holds significant natural gas reserves, has set a 2030 target of 22 GW of renewable power generation, though its renewable energy capacity remains underdeveloped. Tunisia, targeting 35 percent renewables by 2030, is making strides in solar and green ammonia production, with an emphasis on cross-border electricity interconnections with Italy to facilitate renewable energy exports to Europe.

As per the study, MENA region is increasingly focussing on green hydrogen and ammonia production, with Morocco and Oman emerging as potential hubs for export to Europe and Asia. The UAE is pioneering green aluminum production, while Morocco leads in electric vehicle manufacturing and green steel development. Other countries, such as Saudi Arabia, are expanding into green metals processing and industrial manufacturing to foster sustainable economic growth.

Further, collaboration across borders, including power interconnectors and water-energy agreements like the Jordan-Israel partnership, are helping to integrate renewable energy supply chains throughout the region.

However, the experts suggest that establishing platforms for green ammonia exports, constructing power plants to support undersea electricity interconnectors, and encouraging private investment in green fertilisers, mining, and industrial manufacturing will be crucial to positioning the MENA region as a global leader in renewable energy, supporting both local economies and international markets.