The United Arab Emirates (UAE) is both a producer and a consumer of energy. The oil energy is the country’s main source of energy, and for a long period, the country has relied on oil as its main source of primary energy (United Nations, 2009). This trend is far from being over because the domestic demand for oil energy rises every year. For example, the 2013 natural gas consumption in the country was 2,235 billion cubic feet against a production of 1,854 billion cubic feet. This means that the country imported the deficit cubic feet to meet its domestic demand for natural gas. The total consumption of oil energy for the same year was 618 thousand barrels against a production of 3,213 thousand barrels. On the other hand, the country produced 97.9 billion kilowatts of electricity energy, consumed 82.5 billion kilowatts and lost 7.2 billion kilowatts in the process of distributing it (EIA, 2013). With regard to this high demand for energy in UAE, the current energy concern for the UAE as an energy consumer is meeting the ever-rising domestic demand for energy in the country. The essay evaluates this concern together with what the government should do to address the concern.
An energy overview
The current estimate for natural gas reserves in the country is 215 trillion cubic feet. This puts the country at position seven worldwide in terms of the countries with the largest natural gas reserves (EIA, 2013). While this is the case, two factors make the country an importer of natural gas rather than an exporter. The first factor is the high sulfur content in the country’s natural reserves for gas. The second factor is the re-injection of natural gas into the enhanced oil recovery techniques of extracting oil in the already existing oil reserves. This is the case because of the high content of sulfur in the country’s natural gas reserves (EIA, 2013). As a result, the demand for imported natural gas in UAE remains high. The production of electricity constitutes 60 percent of the national demand for gas energy. On the contrary, the supply for oil energy exceeds the demand for oil energy by far. However, its demand has been rising with the increase in population while the country relies heavily on it for its foreign exchange. In spite of this fact, the oil energy remains the country’s main source of foreign exchange thereby the government should reduce the national high dependence on oil energy. The national electricity demand grows annually and is almost exceeding supply (Oxford Business Group, 2007). This means that the country should diversify its sources of energy to meet the ever-rising domestic demand for energy.
The current measures
The Emirati government is concerned about the sources of energy in UAE and because of this it has developed various projects that aim at developing the country and reducing the high dependence on oil as the source of energy. In line with this, the Emirati government together with other key players launched the Masdar city project in 2006 (Low, 2012). This project aims at developing a modern city whose source of energy will be the renewable energy as opposed to non-renewable energy. In this regard, the UAE as a consumer of energy will reduce significantly the high dependence on oil and gas as the major sources of energy. This will not only enable the country to benefit from foreign currency earned from oil exports, but it will also enable the country to reduce its high dependence on oil energy.
Alongside with the Masdar city, the Emirati government has also introduced the dolphin energy project as another way of reducing the high dependence on oil energy. The said project started in 1999 with an aim of producing, processing and transporting natural gas all the way from Qatar to UAE. The strategy imports 2 billion cubic feet of gas on daily basis thereby meeting between fifty and sixty percent of the current demand for natural gas in the country. Dolphin Energy Company based in Abu Dhabi city has facilitated this project since it started (Bahgat, 2013).
Another solution for the high consumption of energy in UAE has been the development and utilization of the nuclear energy. However, the project is aimed at reducing the high energy demand in the future. Despite this fact, the government has taken serious measures that will enhance the establishment of this project in the near future, and the project will meet the 17 percent of national demand for energy by the year 2030 (Mtsiva, 2003).
With regard to minimizing the high energy demand, the Emirati government has continually regulated the prices of oil and petrol in the country upward to discourage overreliance on oil as the main source of energy. At the same time, the government has encouraged the citizens to use energy efficiently together with relying on other sources of energy.
What the government should do
With respect to the importation of natural gas, the government can still do something to bring the high domestic demand for natural gas under manageable levels. In this case, the government should advance the extraction processes in the country by authorizing and legitimizing the use of advanced technology for extracting natural gas (Low, 2012). The said method is able to separate sulfur from the extracted natural gas with ease; thus, can enhance the extraction processes of natural gas in UAE. At the same time, the government should continue with its current measures for the development and use of renewable sources of energy. With respect to this aspect, the government should facilitate the use of solar energy and the development of nuclear energy in the country. According to the national energy body in UAE, the nuclear energy will meet 17 percent of the national demand for energy in 2030 (Mtsiva, 2003). This will not only reduce the current rising domestic demand for energy in UAE, but it will also enhance oil exportation in the country by reducing its overreliance. At the same time, the government should increase it electricity production while reducing its overreliance on gas energy for the production of electricity.
As an energy consumer, UAE faces a challenge of balancing the supply with the demand. This is irrespective of the huge deposits for oil and natural gas in the country. In this regard, the government should diversify its sources of energy to help in controlling the ever-rising domestic demand for energy. One of the methods the government should use in diversifying its sources of energy would be the development of renewable sources of energy such as wind and solar energy. In this regard, the Masdar city is a commendable step towards addressing the ever-rising demand for energy in the country. The other method the government should adopt is enhancing its extraction processes for the natural gas in the country. This is irrespective of the high content of sulfur in its natural gas reserves. In this case, the government should employ the new technology for extracting natural gas that is able to separate sulfur from the extracted gas. The method would supplement the dolphin energy project in minimizing the current demand for natural gas in the country. Finally, the government should continue with its nuclear energy plans.
Bahgat, G. (2013). Alternative energy in the Middle East. Basingstoke: Palgrave Macmillan.
EIA. (2013). United Arab Emirates.
Low, L. (2012). Abu Dhabi’s vision 2030: An ongoing journey of economic development. Singapore: World Scientific.
Mtsiva, V. C. (2003). Oil and natural gas: Issues and policies. New York: Nova Science Publishers.
Oxford Business Group. (2007). The Report: Dubai 2007. London: Oxford Business Group.
United Nations. (2009). Survey of Economic and Social Developments in the Escwa Region 2007-2008. (2009). United Nations Publications.