V. Middle East and Northern Africa

MENA Development Patterns

MENA Energy Intensity

MENA Carbon Dioxide Intensity

MENA Electricity Intensity

• Between 1980 and 2001, the MENA region experienced significant growth in all five categories examined here. Of the four energy-related and economic indicators, electricity consumption grew the fastest, almost quintupling between 1980 and 2001. Energy demand grew the second most rapidly, almost tripling. Carbon dioxide emissions increased a comparatively modest 122% overall.
• By comparison, real GDP grew only 63% overall, meaning per capita incomes shrank, while carbon, electricity, and energy use became more intensive. In part, these intensities rose because governments in the region subsidized energy production and consumption.
• Increased MENA energy consumption and carbon dioxide emissions between 1980 and 2001 reflected the region’s rapid population growth, combined with the development of energy intensive industries.

• Energy consumption grew dramatically in the MENA region between 1980 and 2001, nearly tripling from 9 quads to 25 quads. This reflects an average annual increase of 5.1%, the fastest growth in the world.
• Almost all of the increased energy consumption came from fossil fuels, whose share of total energy consumption increased from 96% to 98% over the period. The MENA region’s almost total reliance upon fossil energy reflects the decisive relative cost advantage of fossil fuels in that region. With much of the world’s most accessible and abundant oil and natural gas reserves, non-fossil fuels generally have played only minor roles in regional countries’ energy pictures.
• The composition of the MENA region’s fossil fuel portfolio evolved during the 1980s and 1990s. While oil accounted for an absolute majority of the MENA region’s fuel mix throughout the period, its share declined after the early 1980s, when it accounted for 70% of total energy consumption, to only 53% in 2001.
• As oil’s share fell, the importance of natural gas rose. In 2001, oil accounted for 53% of the region’s energy mix, compared to 41% for natural gas (up from 24% in 1980), 4% for coal, and 2% for hydroelectric power.
• Egypt is one of the few countries in the MENA region where non-fossil energy plays an important role. The Aswan High Dam accounts for around a fifth of the country’s electricity generating capacity.

• Between 1980 and 2001, per capita income in the MENA region fell 5.0%, from $5,617 to $5,317 per person. An absolute rise in the region’s real GDP of 63% was offset by even faster population growth.
• Between 1980 and 2001, countries in the Persian Gulf suffered severe declines in per capita real GDP as a result of falling real oil prices and rapidly increasing populations. Saudi Arabia’s per capita income fell from over $20,900 per person in 1980 to about $12,200 per person in 2001.
• Saudi real (adjusted for inflation) oil export revenues, a cornerstone of the country’s economy, fell more than 70% between 1980 and the 2004 forecast, while per capita real oil export revenues in 2004 were only 13% of their 1980 figure.^[24]
• Turkey and Israel, the region’s two most economically developed countries, both experienced significant economic growth relative to population expansion. Between 1980 and 2001, Israel’s real per capita income grew an average of 1.7% per year, from $12,858 per person to $18,148 per person. During the same period, Turkey’s GDP per capita also rose 1.7% per year, growing from $4,016 per person to almost $5,700 per person.
• In much of the region, per capita energy consumption increased, reflecting efforts to industrialize. Overall, regional per capita energy consumption grew from 43 million Btu to 71 million Btu between 1980 and 2001.
• Between 1980 and 2001, per capita energy consumption increased in Israel, where income grew, and in Saudi Arabia, where income plummeted. During the period, per capita energy demand in these two countries increased from 90 million Btu to 123 million Btu, and from 178 million Btu to 234 million Btu, respectively.

• The MENA region is the world’s second most energy intensive region (behind the EE&FSU region). Overall, the region’s energy intensity increased 73% between 1980 and 2001 -- an average 2.7% per year -- from 7,723 Btu per $1995-PPP to 13,385 Btu per $1995-PPP. No region’s energy intensity increased faster than the MENA’s during the period.
• The MENA region’s energy intensity increased most rapidly during the early- and mid-1980s. Between 1980 and 1987, the region’s energy intensity increased an average of 6.0% per year, reflecting the expansion of energy intensive petroleum-processing industries in the Persian Gulf, as well as the need to supply more electricity to growing populations.
• Over the entire period examined here, energy consumption increased dramatically in MENA despite relatively slow economic growth. This occurred in part because of the very low cost of fossil fuel extraction in the region. Governments also subsidized energy production and prices.
• Israel, the region’s most developed economy, departed from this trend. Its energy intensity declined slightly, from 7,012 Btu per $1995-PPP to 6,766 Btu per $1995-PPP, between 1980 and 2001. Like the OECD countries, Israel is becoming more of a post-industrial economy where non-energy-intensive sectors account for a growing share of GDP.

• Between 1980 and 2001, carbon dioxide emissions in the MENA region grew 122% overall -- an average of 3.9% per year -- from 721 MMT to 1,603 MMT. Only Developing Asia’s carbon dioxide emissions grew faster.
• In the Persian Gulf and North Africa, increased carbon dioxide emissions reflected almost total reliance upon fossil energy, as well as countries’ efforts to develop “downstream” refining and petrochemical industries.
• In Turkey, growth in carbon dioxide emissions was also very rapid between 1980 and 2001. This resulted in large part from that country’s rapid economic growth, industrialization and electrification.
• Relative levels of per capita carbon dioxide emissions in the MENA region tended to remain largely consistent over time. Those countries with large fossil fuel reserves, like Saudi Arabia, tended to have higher per capita emissions than those countries without such resources. Egypt has especially low carbon dioxide emissions because of its comparatively large hydroelectric sector.

• The MENA region has the world’s second highest carbon dioxide intensity behind Developing Asia. Unlike Developing Asia and all other regions, carbon dioxide intensity in the MENA region is increasing. In 2001, MENA’s carbon dioxide intensity was 0.85 metric tons per thousand $1995-PPP, 36% higher than in 1980. This reflects a 1.5% average annual rate of increase.
• As with energy intensity, most of the growth in the MENA region’s carbon dioxide intensity occurred in the 1980s.
• The MENA region’s increasing carbon dioxide intensity reflects its increasing reliance on energy-intensive industrialization, including the development of refining and petrochemical industries.
• During the 1980s and 1990s, Israel and Turkey, the region’s two most developed economies, had carbon dioxide intensities lower than the MENA regional average. This reflects the more diversified nature of their economies, as well as their somewhat less carbon intensive energy portfolios (Turkey, for instance, relies increasingly on hydropower and natural gas). Most of the rest of the region’s economies are based almost exclusively on industries related to hydrocarbons. Such industries are highly carbon dioxide intensive.
• After Israel and Turkey, Egypt had the next lowest carbon dioxide intensity in the region during the 1980s and 1990s. This reflects its comparatively large consumption of hydroelectric energy, largely from the Aswan High Dam on the Nile River.

• Electricity consumption rose dramatically in the MENA region between 1980 and 2001, more than quadrupling from 139 bkwh to 664 bkwh. The region’s rapidly rising electricity demand (7.7% per year) reflects both population growth, particularly in the Persian Gulf and North African states, and higher per capita electricity consumption rates.
• Overall, the MENA region’s per capita electricity demand almost tripled during the period, from 676 kwh to 1,873 kwh. This reflects an average annual growth rate of 5.0%, the second most rapid in the world behind Developing Asia.
• Reasons for this increased per capita electricity demand varied within the region. Growth in economically developed countries like Turkey and Israel in part reflected structural changes and increased industrial development. For example, Israel’s high-technology sector grew rapidly between 1980 and 2001.
• In developing countries like Saudi Arabia and Iran, growth in per capita electricity demand reflected a number of other factors, including: 1) efforts to industrialize; 2) rural electrification campaigns; and 3) increased residential and commercial power consumption.
• Oil-exporting countries like Saudi Arabia and Libya experienced especially rapid per capita electricity demand growth during the early 1980s. This was an era of rising incomes due to the 1970s oil price increases. After oil prices fell in the mid-1980s, the rate of power demand growth slowed as real incomes fell. Electricity consumption patterns were only partially affected, however, due to intervention in energy markets by governments in the region (e.g. Saudi Arabia).

• Between 1980 and 2001, the overall electricity intensity in the MENA region rose 193%, from 120 kwh per $1995-PPP to 352 kwh per $1995-PPP. This reflects an average annual growth rate of 5.2%, the fastest rate in the world.
• In part, the MENA region’s rapid growth in electricity intensity reflects the maintenance of substantial subsidies on fossil fuels, which allowed consumption to grow despite falling incomes.^[25]
• MENA’s electricity intensity rose especially rapidly during the 1980s, growing an average of 8.2% per year between 1980 and 1989. From 1990 to 2001, the MENA region’s electricity intensity increased at a comparatively modest 3.2% per year. The change likely reflects the impact of lower oil prices on countries dependent on petroleum exports.
• Egypt exemplifies the trend of many nations in the MENA region. Between 1980 and 2001, Egypt’s population and per capita real GDP each grew substantially, fueling a rise in electricity intensity. By 2001, Egypt consumed 328 kwh per $1995-PPP, a 54% increase compared to 1980.
• Saudi Arabia’s electricity intensity grew even more rapidly between 1980 and 2001, rising from less than 100 kwh per $1995-PPP to 444 kwh per $1995-PPP.