By Inviroglobal team
Oil and gas revenues for GCC countries have enabled exceptional and accelerated development in all aspects of life. These countries have become a hub of intense activity in many spheres—geopolitical, military, economic, industrial, construction, and tourism, to name a few. However, the scale of oil and gas production and use has also led to severe environmental problems.
The GCC countries face a multitude of “traditional” environmental challenges, such as desertification, biodiversity loss, pollution in marine and coastal areas, air pollution, and water scarcity and quality. During the past few years, an additional set of environmental problems has arisen, especially those related to military conflicts and construction and demolition debris. Prominent among these emerging environmental problems faced by the region is climate change, the focus of this Policy Brief.
It is worth mentioning that traditional and emerging environmental threats are all interlinked. For instance, desertification leads to biodiversity loss; livestock increase and overgrazing leads to desertification; waste-dumping releases methane, which adds to the global warming problem, which in turn leads to desertification, water scarcity, and many other ecological disasters.
Ecological Footprint can be a good indicator for us to understand the severity of these problems. According to the WWF/Ecological Footprint report Our Living Planet, which covers 150 countries around the world, the UAE has the largest footprint in the world, i.e. people in the UAE are placing the most stress per capita on the planet. Compared to the world average Total Ecological Footprint (TEF) of 1.8 global ha/person, the TEF for the UAE was 11.9 global ha/person (hectares/person). Kuwait and the Kingdom of Saudi Arabia also have very large footprints — 7.6 and 4.6 global ha/person respectively. (The above-mentioned countries are the only GCC countries that figure in the report.)
Certainly, the report is just an indicator of the unsustainable patterns of development and living. Furthermore, criticism can be directed towards the report, as it is unfair to compare tropical countries with nations in arid zones because the climatic conditions and pressures on the environment are very different. In addition, the UAE has contributed to environmental projects in other parts of the world, such as Pakistan, Morocco, and Lebanon. Another point that is not considered in the report is the millions of dirhams that are sent out of the UAE by the large expatriate population who are supporting their families back home.
Climate Change
The UN Intergovernmental Panel on Climate Change (IPCC) published four reports in 2007 stating that global warming is an observable fact beyond all doubt. Anthropogenic activities are the main reason for climate change. The report stated that, because of global warming, in the last 12 years the earth has seen the warmest surface temperatures since 1850 and higher global average sea levels. Temperature rise is blamed for a wide range of natural incidents around the globe, such as rising sea levels, melting ice caps, and an increase in the number of severe storms. If temperature rise is not stopped, and particularly if it exceeds 2 to 3 degrees Celsius, IPCC warns that the world could face massive species extinctions, widespread starvation, declining production of crops, and a persistent rise in sea levels that could drown perhaps major parts of the world’s coastal areas. As a result, climate change is considered by many security experts to be a greater threat than global terrorism.
The GCC countries will be directly impacted by such developments. If sea levels rise, natural and especially man-made islands in the region and elsewhere will disappear, with Bahrain potentially losing up to 15 kilometers of coastline. In addition, underground water salinity will increase, more land degradation will occur in the region, and biodiversity on land and in the Gulf will be affected. As one expert has stated: “There are two major and immediate consequences: first, rising sea levels will affect coastlines and marine life severely and could impact on desalination plants that are the source of water for the region. Second, rising temperatures means increasing water demand and with falling freshwater levels and increasing salinity in sea water (which affects the efficiency of desalination plants), water scarcity is a fearsome prospect.”1
The social impact will be severe, as many workers will lose their jobs in agriculture, fishing, and some traditional oil industries as a result of a world shift toward renewable energy sources. In short, climate change threatens to seriously undermine efforts to eliminate poverty and reach the Millennium Development Goals (MDGs).
The ecological changes in the Gulf region are small compared to catastrophic disasters like hurricanes, tsunamis, and floods in other parts of the world. But the economic impact in the Gulf countries will be more severe, as they mainly depend on revenues from oil and gas exports. If the world shifts soon to other renewable sources of energy, the Gulf region will suffer seriously. Figure 1, for example, shows that the Gulf region falls in the “high” category on the global map of vulnerability to climate change issued by the World Economic Forum (see Appendix for GCC countries’ per capita emissions ranking).
The Gulf countries face a difficult situation as they depend mainly on fossil fuels — the main cause of carbon dioxide (CO2) emissions — and their economies are dependent on the oil, gas, and petrochemical industries. Though the rate of development is high, the lack of arable land and water resources prevents the development of carbon sinks, forests, and green areas.
Besides being the world’s main petroleum exporters, Gulf countries have been under fire for carbon emissions from the large-scale use of fossil fuels. The UAE, Saudi Arabia, and Iran figure among the world’s top 50 CO2 emitters. Iran ranks 18th, Saudi Arabia 22nd, and the UAE 43rd, according to the World Resources Institute. Even though the region’s total carbon emissions are very low (only 2.4%) compared to other regions, per capita emissions are very high. There is thus no doubt that the Gulf countries share responsibility with the rest of the world for climate change and hence must work to diversify the energy pie and look for more environment-friendly energy sources. Yet, while it is a common responsibility, different obligations must be charted out for different countries.2 Giant emitters, for example, should shoulder more burdens. Gulf countries do recognize the problem and are trying to come up with innovative solutions in the renewable energy field to offset this. This is very clear in recent initiatives such as Abu Dhabi’s Masdar, a carbon-neutral city due for completion in 2009.
Another option is for the GCC to base its stand on climate change and emission reduction issues upon the User Pays Principle (UPP). This is one of the basic principles of environmental economics, which is based on the premise that the countries which use fossil fuels instead of the producers should shoulder the burden of this carbon emitting source of energy. As such, oil prices have in fact been underpriced because the carbon emissions of the users have not been factored in. This is referred to as market failure, since the price produced by freely functioning markets does not reflect the true social costs or benefits of an action. In economic terminology, the environmental damage or benefit is an external effect or externality. Raising prices or providing subsidies to include these environmental costs and benefits can be made an integral part of the price mechanism. As a result, from the environmental point of view and leaving aside economic issues such as nominal prices of oil in the 1970s, inflation rates, and GCC currencies pegging to the US dollar, the GCC and oil-exporting countries have charged uneven oil prices in the past four to five decades because they have not added the margin for the external cost of climate change.
The Kyoto Protocol to the United Nations Framework Convention on Climate Change (UNFCCC) has called for, and is now trying to ensure that, of the 166 countries that ratified it, 40 industrialized countries should turn back to the level of emissions in 1990 and reduce their overall emissions of GHG gases by at least 5% below 1990 levels in the commitment period from 2008 to 2012. GCC countries are either signatories or have acceded to many of these international environmental agreements (see Table 1). In addition, changes in environmental legislation are being made to cope with the requirements of these agreements or to close the gaps in the current environmental laws.
Renewable Energy and Climate Change
There is no doubt that renewable energy projects and other clean technology for mitigating climate change will enable GCC countries to align their GHG reduction and human development efforts, and promote mitigation activities that do not slow down, but rather accelerate socioeconomic progress. The Arab region is not only granted an enormous supply of oil and natural gas but also a perfect geopolitical positioning wherein it receives maximum exposure to sunlight and in many areas wind, which would provide endless renewable energy. According to a regional expert, “the region is exposed to direct sunlight, as well as a reduction in the percentage of clouds. The usual Direct Natural Exposure (DNE) in the Gulf region is about 1800 kilowatt/h per every square meter and this makes the adoption of solar energy in the region technically and economically feasible. Statistics show that both the Middle East and the North of Africa are equipped to deal with this technology…”
Wind-generated energy is the least costly among all sources and wind is in abundance in the region. For example, it covers areas as wide as 8-11 meters per second in countries like Oman. Despite these facts, however, renewable energy is almost non-existent in Arab states, representing only around 0.1% of their energy supplies and producing less than 0.3% of their electricity. The few renewable energy projects in GCC countries include:
A mobile reverse osmosis desalination unit in Bahrain operated by solar power with a capacity of 200 gallons per day and a mobile generator operated by solar and wind power with a capacity of 1.5 kilowatts.
Solar cooking, solar desalination, thermal and solar electricity and photovoltaic systems projects in Saudi Arabia. These projects were implemented through the American Cooperation Program that carried out many research and development programs in the last two decades of the 20th century.
A desalination project in Oman using thermal and solar power established to produce a limited amount of drinking water. Photovoltaic systems with a capacity of 352 kwt were built for pumping water, lighting, and communications.
Prior to the Gulf War in 1990, research and development projects were carried out in Kuwait on solar lakes, air conditioning, and photovoltaic systems.
Some mini-solar projects were implemented in the UAE for different purposes, such as phone cabins and traffic signals.
