Some of the countries blessed with high potential of solar energy and have enough resources (Oil and Gas) to finance renewable energy projects. Why these countries are still very far behind and what are the futuristic consequences on their economy?
According to me oil & gas are limited resources & need to be conserved. If a developing country wants to transform itself into a developed country, then more and more resources are to be pumped into the power pool, to meet the development challenges. Renewable energy sources must be tapped to the best possible extent. The main barrier in using renewable energy sources is their fluctuation in power generation, for example if solar power has a considerable share in total power generation, then whenever the solar power comes into the grid or goes out of grid, it would give a jerk to the main grid.These jerks can well be absorbed if that country is rich in oil & gas power generation.
Hi Ashraf,
I feel that unless we see crude oil prices worldwide skyrocketing, commercial level exploitation of renewable sources will continue to take a back seat !! Currently the crude prices are rather low due to a host of political and economic reasons, and international relations.
The fact that the US and some other countries are able to evolve viable alternatives to conventional crude oil (such as shale oil and fracked crude) complicates matters further, and makes certain renewable sources marginally nonviable !
In a nutshell, the market that renewable technologies are likely to see in economies that are rich in fuel sources would possibly depend on:
- Crude oil prices.
- Cost and availability of oil alternatives.
- Cost of renewable technologies vs environmental advantages.
Cheers !
-Sanjay
Dear prof. Ashraf Khalil,
All above professors have given the good explanation for your question. Added to that the following reasons also act as main barriers of the renewable energy adoption in the developing countries
1..Missing of long term prospective.
2.Number of policy barriers.
3.Technical barriers like control aspects and maintain the reliable power
4.Financial barriers.
5.Commercialization barriers faced by new technologies competing with mature technologies.
6.Price distortions from existing subsidies and unequal tax burdens between renewable and other energy sources.
7.Failure of the market to value the public benefits of renewable.
8.Market barriers such as inadequate information, lack of access to capital, partial incentives between building owners and tenants, and high transaction costs for making small purchases.
Dear Andres,
Thank you for you answer. Additionally some decision makers in developing countries view renewable energy as science fiction.
Dear Sunil,
Thank you for your answer. I totally agree with you, that they intermittent. But there are many economically feasible applications such as street lighting, however no adoption to such applications.
Dear Sanjoy,
Thank you for your valuable time, I agree with you but the oil-rich developing countries will have a difficult decision at that time, To burn or to sell the oil?
Dear Maharaja
Thank you for your precious time. Number 1 and 2 are exactly what happens in Libya, the government has set a plan to increase its renewable energy share but the plan was unrealistic and most of the projects are suspended or delayd.
Dear Dr.Ashraf Khalil,
There are many important factors that are effect in appearing of renewable energy. Added to the above reasons the unawareness among local people toward this technology is the main of these obstacles.
There are a variety of challenges facing the oil and gas industry in the developing countries that are rich in oil and gas resources that pose a threat to the basic oil and Gas Companies’ structure and business model. challenges such as: Price fluctuation; Increasing pressure on managers by shareholders focusing on value creation instead of output because of low returns on investments; Complexity of oil and exploration, drilling and production process; HSE compliance remaining critical - especially in the current environment of volatile prices and cost savings; Protection of the social license of operation and corporate social responsibilities; Fluctuation of fiscal regimes; Unstable partnership of NOC-IOC, behavior of consumers towards renewable energy, innovations such as a changeover to electric vehicles could result in a significant reduction in demand for gasoline and many developed countries are implementing strategies to move away from their dependence on oil and gas by reducing domestic consumption and emphasizing renewables.
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