Strategy& partners pen book on GCC’s green energy opportunity

Strategy& Middle East partners Yahya Anouti and Shihab Elborai have authored a new book which argues that the GCC region would realise significant gains by transitioning its energy sector now.

Dubbed ‘Arabian Gambit’, the central premise of the book is that while the Gulf is the leading exporter of fossil fuels, it also produces the lowest-cost renewables, placing the region at a distinct advantage to capitalise on global decarbonisation.

Both doctorate-holders and frequent collaborators, Elborai and Anouti have each spent more than a decade at Strategy& (and previously Booz & Company) and respectively gained partnership to the consultancy’s energy, resources & sustainability practice in 2018 and 2019.

On their book, the pair write: “The abundance of both fossil and renewable resources means that at every point on the path from a hydrocarbon-based system to a fully decarbonised one, GCC countries can deliver the cheapest configuration for the desired CO2 emissions level without compromising on energy security. In other words, they are well placed to continue their role balancing supply and demand.”

Here, the authors identify five priority areas that Saudi Arabia and its neighbours should concentrate on to put themselves in the driver’s seat as superpowers in the ongoing energy transition, namely green hydrogen, future plastics, low-carbon manufacturing, and agricultural evolution, together with renewables.

The investment needed, however, would come with a hefty two-decade $3 trillion price tag.

Yet, the payoff would be rapid, they argue, especially once renewable energy production has scaled. Elborai: “In chess, a gambit is about sacrificing a minor piece to gain a strategic and often winning advantage. The sacrifice that this Arabian Gambit requires is about taking a calculated risk and investing ahead of demand in order to gain an insurmountable advantage in the future.”

On top of an abundance of sun and wind, the region also has other advantages which position it as a potential green energy powerhouse, such as its geographical proximity to two large import markets and a ready supply of capital, which the authors conclude ultimately upends the conventional wisdom that the net-zero evolution will diminish the prosperity and influence of the Gulf petrostates.