1. © World Energy Council 2015 What price for sustainable, secure energy? Joan MacNaughton March 28, 2015 Abu Dhabi, United Arab Emirates

2. © World Energy Council 2015 Energy in the Middle East ► 66% of the world’s oil and 45% of the world’s natural gas reserves ► Electricity generation relies heavily on fossil fuels ► Generous subsidies ► Emission and energy intensity highest in the world ► Investment needs to 2035 close to US$4trn

3. © World Energy Council 2015 Middle East investments needs to 2035 2014, IEA; World Energy Investment Outlook

4. © World Energy Council 2015

5. Trilemma profile Middle East and North Africa

6. © World Energy Council 2015 United Arab Emirates on rank 35 6 201220132014TrendScore Energy security 564947  B Energy equity 39378  A Environmental sustainability 106102  D Overall rank and score 534435  ABD

7. © World Energy Council 2015 7 Energy Sustainability Index Policy review and analysis (deep dives) Call for increased dialogue  2012 report views of 40 senior energy executives  2013 report response of governments, multilateral organisations and development banks  2014 report views of financial sector leaders as a follow up to Agenda for Change World Energy Trilemma report

8. © World Energy Council 2015 8 Clear vision with a mix of energy sources and technologies

9. © World Energy Council 2015 Increasing policy complexity 1.Lack of global consensus on target profile of future energy system 2.Dynamics of changing energy supply and demand 3.Inherent difficulties in translating policy into effective regulations

10. © World Energy Council 2015 Help from energy industry 1.Greater dialogue, sharing knowledge and experiences 2.Better risk alignment 3.Economic development on a new path to energy sustainability

11. © World Energy Council 2015

12. Increased engagement with the financial community 1.There is enough money available if the right conditions are provided. 2.Policymakers must focus on implementing the policy frameworks to reduce political and regulatory risks. 3.The financial infrastructure must exist for capital to flow easily to the energy sector. 4.The energy sector must bring clearly bankable projects to the market.

13. © World Energy Council 2015 The lack of a global climate framework is one of the greatest uncertainties globally

14. © World Energy Council 2015 In the Middle East, uncertainty around the lack of a climate framework is high

15. © World Energy Council 2015 What are the options for a climate framework 2 o goal Weak SPECTRUM OF AGREEMENTS Strong A voluntary, non-binding agreement with national monitoring A voluntary agreement, international review and monitoring International agreement with binding targets, international monitoring and enforcement mechanisms

16. © World Energy Council 2015 2015 Outlook Challenges and opportunities for the energy sector in adjusting energy supply and use to meet post-2015 sustainability goals Interviews Regional workshops National dialogues Energy sector perspective to feed into international discussions on post-2015 goals

17. © World Energy Council 2015 Investment needs to 2035 Source: IEA, World Energy Investment Outlook, 2014

18. © World Energy Council 2015 Issues ► Long term investment in oil & gas must rise substantially in the Middle East ► Risk of stranded assets? Carbon capture and storage? ► Diversification Policy framework – Coherence; clarity; energy pricing and use

19. © World Energy Council 2015 What price for sustainable, secure energy? Joan MacNaughton March 28, 2015 Abu Dhabi, United Arab Emirates