Paradoxical as it may appear, it is now widely accepted that the major oil producing countries of the Gulf face their own energy crisis. This is not due to imminent exhaustion of hydrocarbon reserves, as some had predicted or feared in the past decade. The threat of peak oil has dramatically receded in the past five years, thanks to the rapid increase of production from so-called non-conventional oil and gas reserves – primarily in the United States, but also in the rest of the world. Indeed, it is increasingly clear that those resources are not confined to the United States or North America, but found in many other parts of the world, including the Arabian Peninsula.

Neither is the crisis due to universal acceptance of targets for the effective reduction of greenhouse gases (GHG) in order to contain global warming within 2 degrees centigrade, which science suggests is the maximum that we can afford before catastrophic consequences emerge. It is rather due to the very rapid increase in domestic energy consumption, which threatens to outpace the growth in hydrocarbon production; and the growing awareness of the fact that an energy system exclusively reliant on hydrocarbon sources is not sufficiently flexible and does not provide an adequate platform for economic diversification and sustainability of the Gulf economies and societies.

The need for energy reform and diversification of energy sources is nowadays well accepted in all the countries of the Gulf Cooperation Council (GCC: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates). Actual implementation of diversification plans and uptake of alternative energy sources is however mostly lagging. The United Arab Emirates (UAE) are making rapid progress in the implementation of their nuclear energy program1, with a first reactor scheduled to enter in operation in 2017, and three more to follow in rapid succession thereafter. But plans for the adoption of solar and wind energy remain mostly at the stage of initial or demonstration project – even if individually they are of comparatively large size, such as the Shams project in Abu Dhabi2, which has a total capacity of 100MW – and are far from making a significant contribution to total power production.