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Renewable energy

Electricity Demand in the Middle East and North Africa to Rise Sharply

Strategic Insights

— 2 min read

Electricity consumption in the Middle East and North Africa has soared in recent decades and is set to continue rising sharply, driven by a range of factors including urbanisation, industrialisation, and the electrification of transport. Based on current policy settings, the region's electricity consumption is projected to rise by another 50% by 2035, with the largest portion of the increase coming from cooling and desalination to cope with the region's extreme heat and water scarcity.

Key Takeaways:

  • Electricity demand in the Middle East and North Africa tripled between 2000 and 2024, with a range of factors driving up consumption, including population growth, urbanisation, and industrialisation.
  • Based on current policy settings, the region's electricity consumption is projected to rise by another 50% by 2035, with the equivalent of the current demand of Germany and Spain combined.
  • Natural gas and oil currently dominate the region's electricity mix, accounting for over 90% of total generation, but many countries, including Saudi Arabia and Iraq, are pursuing policies to reduce the role of oil in their power systems.
  • Renewable energy capacity is set to increase significantly, with solar PV capacity on course to increase tenfold by 2035 and pushing the share of renewables in the region's electricity generation to around 25%.
  • Nuclear power is poised to expand strongly, with capacity set to triple, and grid modernisation and energy efficiency will play a critical role in underpinning electricity security in Middle Eastern and North African economies.
  • A balanced approach to integrating renewables, combining energy storage, demand-side flexibility, and sufficient dispatchable natural gas-fired capacity, will be crucial to manage variable solar or wind supply.

Statistics:

  • Electricity demand in the Middle East and North Africa tripled between 2000 and 2024, growing from 55 Gwe to 175 Gwe.
  • The region's electricity consumption is projected to rise by another 50% by 2035, with the equivalent of the current demand of Germany and Spain combined.
  • Natural gas and oil currently account for over 90% of the region's electricity generation, with oil-fired output at 20% of total generation.
  • Renewable energy capacity is set to increase significantly, with solar PV capacity on course to increase tenfold by 2035.
  • Nuclear power capacity is set to triple, and grid modernisation will be a crucial component of underpinning electricity security in the region.
  • Power sector investment in the region reached $44 billion in 2024 and is projected to rise by another 50% by 2035.
  • Energy efficiency could reduce peak electricity demand growth by an amount equivalent to Iraq's total power capacity today.

Sources:

  • International Energy Agency (IEA), "The Future of Electricity in the Middle East and North Africa"
  • IEA Executive Director Fatih Birol, "Demand for electricity is surging across the Middle East and North Africa..."

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