Regional energy and carbon emissions concerns: Towards cleaner energy transition in Middle East and North Africa

Abstract

Energy efficiency plays a crucial role in enabling a cleaner and more affordable energy transition in the Middle East and North Africa (MENA) region and worldwide. This paper focuses on investigating how MENA countries can attain cleaner and affordable energy through economic policy options. The study employs sustainable development goals variables and applies production and ridge regression analysis techniques to model the relationship. The findings reveal the presence of strong link between energy and economic growth in the MENA region. Additionally, the study highlights perfect elasticity substitution technology between capital-energy and energy-labor in MENA countries. The insights suggest that policymakers should use policy substitution technique in production factors including substituting hydrocarbons with renewable energy towards cleaner energy transition. In energy efficiency and carbon targeting, the study unveils that the energy efficiency outlook in the MENA region is low with worsen carbon efficiency indicator. This indicates that MENA countries have surpassed their carbon frontier targets and need to reduce their carbon emissions by 2030. In conclusion, the authors highlight that achieving cleaner and affordable energy transition with climate action presents multifaceted policy choices for developing countries. To address those challenges, the study recommends the removal of energy subsidies, particularly in fossil fuels in countries like Iran and Saudi Arabia. Moreover, policymakers may leverage current energy technologies such as blockchain and the Internet of Things to enhance energy efficiency to reduce carbon intensity in the MENA region.