Abu Dhabi: Energy demand in the Gulf to triple in the next fifteen years far outstripping today’s supply, a report released by National Bank of Abu Dhabi (NBAD) titled Financing the future of Energy said.

It points out that the closing the global energy gap will require $48 trillion (Dh176 trillion) of investment over the next 20 years in projects that provide additional energy generation capacity and improve the efficiency of energy use.

The report, commissioned by NBAD, the University of Cambridge and PwC (Pricewaterhouse Coopers), and in collaboration with Masdar, sets out the changing nature of the global energy mix over the next decade which will see an increased contribution from renewables.

“We should not underestimate the scale of the task that is facing us all,” said Alex Thursby, chief executive officer of NBAD.

“To meet the significant demand for energy globally — in particular across the West-East Corridor, the rapidly growing super-region that stretches from Africa through the Middle East to Asia — we need to develop innovative approaches to financing energy projects,” said Thursby.

The report provides the evidence base from which the financial services sector can develop innovative financing structures and products to meet this significant opportunity and support the growth of the low carbon economy.

It also provides insights into how the financial community can engage with public and private sector stakeholders to create a more integrated energy mix for the future.

Taking part in a panel discussion on the Future of Energy, experts said it has become more economical to generate renewables.

“The world needs more renewables because of environment concerns and low carbon emissions,” said Rafi Baghdjian, chief operating officer at Shell Abu Dhabi.

New world benchmark

Prices have fallen dramatically in the past few years, solar photo voltaics falling by 80 per cent in six years, and onshore wind by 40 per cent.

At the end of 2014, the 200 megawatt Dubai Electricity and Water Authority (Dewa) bid in Dubai set a new world benchmark for utility scale solar photo voltaic costs, showing that photovoltaic technologies was cheaper than oil at $10 per barrel and gas at $5/MMBtu, the report said.

The Financing the future of Energy report was launched on Sunday at the Global Financial Markets Forum in Abu Dhabi, which was inaugurated by Shaikh Nahyan Bin Mubarak Al Nahyan, Minister of Culture, Youth and Community Development.

In his speech,  Shaikh Nahyan said Abu Dhabi has become a financial and business global centre and is playing an important role in innovation and creativity, giving important benefits to the world as a whole.

He stressed the strong link between culture and the financial sector, saying that global markets are well aware of the importance of working in Abu Dhabi and contributed to its presence here in enriching the culture of the city.

“We are proud in Abu Dhabi and the UAE’s business climate and we hope to work together for sustainable development. Openness, access and transparency have become basic principles of our financial system.”

The country followed an open economic model that continued to refine and promote, he said.

“This openness was complimented by accessibility to markets. Diversification of economy has boosted country’s capital markets.”