Countries in the GCC and wider MENA region are considering establishing a common regional electricity market to help meet their rising demand in a more affordable and reliable manner. A more fully integrated regional electricity system and market hast he potential to deliver substantial economic, reliability and environmental benefits. GCCIA has estimated monetary benefits of US $5.66 billion within the GCC over a period from 2014 to 2038. This potential is expected to be larger if countries in the MENA region are also included. Despite this significant potential, regional electricity system integration within the GCC and wider MENA region is currently relatively limited. Development of an integrated electricity market will help in realizing this untapped potential through efficient utilization of local resources. It could also facilitate more cost-effective integration of variable renewable generation, opening the possibility for larger-scale deployment over time.
This project will examine the key issues affecting electricity market integration within the GCC and wider MENA region, including experiences of other integrated markets and their potential application for this region. Policy, regulatory, system operation, physical market and financial market dimensions will be examined, with a view to identifying good practice arrangements that can encourage efficient regional electricity trade to improve power system efficiency, reliability and flexibility at least cost. The various outputs are intended to fill existing knowledge gaps and facilitate the ongoing efforts toward regional electricity market integration. This project will help inform and draw upon other research being undertaken within the Electricity Sector Transitions initiative. Further, this may also complement the KEM-GCC modeling work and decision science’s research program.