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Fri 27 Nov 2009 12:42 PM

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Nuke power is good investment op for GCC - LSE

Gulf oil producers are in a good position to develop carbon capture & storage.

Large-scale sustainable energy projects are more likely to be successful at cutting carbon emissions in Gulf states than initiatives aimed at consumers and businesses, according to a new report published by the London School of Economics.

The report said that although the residential sector was responsible for the bulk of electricity and fuel consumption, it would be "too difficult politically" to tackle this through increasing prices or regulation.

Professor Steffen Hertog said: "Low prices are seen part of the bargain between the ruling elites and the people. Attempts to increase them have been repeatedly resisted. So, at a time when many people are struggling to adapt to the rising cost of imported goods, significant increases in prices seem unlikely."

Instead, the report argued that sustainable energy policies should be pursued through 'insulated' projects, which are under the direct patronage of the ruling elite and thus shielded from bureaucratic and political interference.

The study said that current large fiscal surpluses from high oil prices have given Gulf nations "large-scale autonomy for institutional and technological experiments such as in sustainable energy".

It added that the region was "aggressively exploring the potential of renewable sources of energy such as solar and wind".

According to the report nuclear power is also a good investment opportunity for the Gulf states while Gulf oil producers are in a good position to develop carbon capture and storage.

Co-author Giacomo Luciani, also director of the Gulf Research Centre Foundation in Geneva, added: "There is considerable potential for the Gulf states to cut their carbon footprint while continuing to develop rapidly.

"As signatories of the Kyoto Protocol they need to reduce their reliance on fossil fuels while, at the same time, meeting a rapidly growing demand for electricity."

He said that Gulf states were also keen to be seen internationally as technological and industrial leaders rather than as just a source of energy and overseas capital

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