Policy approaches to achieving SDG 7 vary in scope and ambition among the Arab countries, reflecting their unique national contexts and available resources. Several common trends are evident across countries, however, regardless of their geographic location or income level.
Energy policymaking in the region has focused on ensuring energy access, which has largely been met with fossil fuels. Countries have sought to enhance the security of their electricity supplies by expanding installed generation capacity and improving service reliability. For instance, in Egypt, the Integrated Sustainable Energy Strategy 2035 has provided a roadmap for substantial growth in power generation, transforming a daily deficit of 6,000 megawatts in 2015 into a surplus of 19,000 megawatts by 2021. In Saudi Arabia, the National Transformation Programme 2020 set ambitious targets to reduce the annual number
of power grid outages lasting more than 5 minutes from 6.36 to 3 by 2021, while increasing the electric generation capacity reserve margin from 10 per cent to 12 per cent of expected peak demand.
In Egypt, the Integrated Sustainable Energy Strategy 2035 was launched in 2015 to address widespread electricity shortages that were forcing electricity utilities to conduct rolling blackouts across the country. The strategy aims to boost electricity generation by using a combination of energy sources, prioritizing renewables but including fossil fuels and nuclear energy. Through large investments in 26 new power stations, the daily power generation capacity of Egypt more than doubled, surging from 23,000 megawatts in 2015 to 51,000 megawatts in 2021, allowing the country to become
a regional power exporter. Concurrent efforts have strengthened the transmission network through the addition, replacement and renovation of overhead lines and transformer stations. Furthermore, Egypt is engaged in electrical interconnection projects with Cyprus, Greece, Saudi Arabia and the Sudan, positioning the country to potentially serve as a regional energy hub.
In Morocco, the Global Rural Electrification Programme, launched in the mid-1990s, has yielded remarkable results, increasing the proportion of the rural population with access to electricity from 22 per cent in 1996 to over 99.9 per cent in 2021. The programme leveraged diverse electrification strategies, prioritizing decentralized renewable solutions, notably solar photovoltaic systems, in conjunction with public-private partnerships established under long-term concession contracts. In its latest tranche (2019 to 2023), the programme aimed to extend its coverage to 1,270 additional villages, benefitting 30,900 households, thereby projecting a rural electrification rate of 99.93 per cent. Despite the delayed entry of Morocco into rural electrification, with only 44 per cent of its rural population having electricity access in 2000, compared to 96 to 97 per cent in Algeria, Egypt and Jordan and 87 per cent in Tunisia, the country swiftly caught up, achieving universal rural coverage even ahead of some countries that had an earlier advantage.
Historically, countries subsidized energy prices to ensure universal affordability and promote growth. However, some are phasing out these subsidies due to their growing fiscal burden. The surge in energy consumption across the region in recent decades has made these subsidies unsustainable, particularly amid rising debt and fiscal constraints. Balancing the need for affordable energy access, particularly for low-income and vulnerable populations, with the requirement for sustainable energy policies, poses a significant challenge for
the region.
Morocco initiated a substantial subsidy reform in 2013, reducing fuel subsidy spending from 5.3 per cent of GDP in 2011 to 1.1 per cent in early 2015. Subsidies for gasoline, diesel and fuel oil were completely eliminated. The reform resulted in annual fiscal savings of about $3 billion relative to 2011. Subsidy removal has increased domestic energy prices: between 2011 and early 2015, gasoline and diesel prices rose by
25 per cent and 35 per cent, respectively. To mitigate the impact of rising energy bills on low-income households, Morocco expanded existing social safety nets, such as the Tayssir conditional cash transfer programme and the RAMED health insurance scheme. While the removal of subsidies on fuel oil used in electricity generation implied higher electricity prices, the lowest consumption bracket, with a monthly use of less than 100 kilowatt-hours, remained exempt from tariff increases. These pro-poor reforms eliminated regressive subsidies, with a minimal direct impact on the poorest 20 per cent of the population. Morocco has also pursued ambitious renewable energy targets, emphasizing coherence in its energy policy.
All States have set targets or enacted policies to promote renewable energy, with a strong focus on the power sector. In most countries, these targets are aligned with mitigation commitments in nationally determined contributions under the Paris Agreement on climate change. Notably, the number of countries with official renewable energy targets rose from 4 in 2010 to 12 in 2015 and 22 in 2023. Most national targets remain legally non-binding, however. Moreover, only 8 out of the 17 Arab States surveyed by the World Bank’s Energy Sector Management Assistance Program1 (Bahrain, Egypt, Jordan, Oman, the State of Palestine, Saudi Arabia, Somalia and the United Arab Emirates) have developed action plans or strategies to achieve renewable energy targets. Saudi Arabia has made significant strides in integrating renewable energy into its energy policy framework, aligning with its broader objectives of reducing fossil fuel dependence and diversifying the energy mix.
The country set its renewable power target under the National Renewable Energy Program (2017) and created a regulatory framework for renewable energy projects through the Renewable Energy Projects Development Regulations (2018). Additionally, Saudi Arabia updated its Grid Code in 2020 to incorporate new regulations for handling renewable energy variability, ensuring
grid reliability with high renewable energy penetration. As of 2021, the country also offers long-term power purchasing agreements for renewable energy projects, providing developers with secure prices for their electricity over extended periods, typically 20 to 25 years. While the renewable energy share of electricity in Saudi Arabia remained at 0.1 per cent between 2018 and 2021, recent policy changes are expected to have a significant impact on advancing renewable energy development in the country.
The Solar Promotion Programme of Tunisia, launched in 2005, provides a 20 per cent capital cost subsidy for residential solar water heaters and low-interest loans facilitated through commercial banks. Utilizing electricity bills for repayments, with the State-owned utility as a debt collector and guarantor, this innovative approach bolstered the solar water heater market.
By 2010, installed capacity surged fivefold, reaching 119,000 systems. Not only has the programme enhanced energy independence, but it has also curbed fossil-fuel subsidies, resulting in substantial long-term savings for the Government. Moreover, the programme has fostered job creation and environmental benefits by mitigating oil consumption and greenhouse gas emissions. Key to its success are training programmes, accreditation schemes and the involvement of the Tunisian National Agency for Energy Conservation
in programme design and implementation. This experience underscores the potential for leveraging public resources, including utilities, to support renewable energy investments and steer demand away from conventional energy sources.8 The region has made progress in adopting energy efficiency policy frameworks, yet lacks specific policies targeting critical energy-consuming sectors – such as buildings and transportation. As of 2021, 16 of 17 countries had adopted energy efficiency action plans or legal frameworks, a significant increase from 5 in 2010 and 11 in 2015.9 Additionally, these 16 countries have also established national energy efficiency targets. More needs to be done, however, to develop and implement energy efficiency policies tailored to key energy-consuming sectors, such as buildings and transportation. Some countries (9 of 17) have mandatory energy efficiency ratings for buildings and/or labelling systems.10 Only five have established heating and/or cooling strategies to guide building performance aspirations.11 Jordan and the State of Palestine are the only two countries out of 17 to have national standards or regulations for near-zero energy buildings.
Countries are increasingly delving into clean hydrogen and its derivatives as alternative energy carriers but with a notable absence of regulations and incentives to drive these initiatives. Clean energy solutions have potential to leverage the region’s abundant natural gas resources, aided by carbon capture and storage, as well as its vast renewable energy potential for green hydrogen production. Clean hydrogen presents an opportunity to diversify export earnings, cut energy-related emissions, and enhance environmental and economic resilience. While several countries, including Egypt, Mauritania, Morocco, Oman, Saudi Arabia and the United Arab Emirates, have clean hydrogen projects in various stages of development (box), comprehensive legal and regulatory frameworks for low-carbon hydrogen production are still lacking. The United Arab Emirates took a step forward with the adoption of a national hydrogen strategy in 2023.
The National Hydrogen Strategy 2050 of the United Arab Emirates aims to scale up clean hydrogen production to 1.4 million tons per year by 2031 and 15 million tons per year by 2050. This ambitious, multipronged approach focuses on building a robust regulatory framework, fostering a strong supply chain, creating a dedicated national R&D centre for hydrogen technologies, and promoting collaboration to create a regional hydrogen market. The strategy is a crucial tool to meet the country’s 2050 net-zero commitment and the objectives of the Paris Agreement, especially by tackling emissions reductions in hard-to-abate sectors, such as transport, chemicals, fertilizers and metals.12
While the pursuit of SDG 7 shows overarching trends, subregional nuances reveal varying realities. In middle-income countries, these general patterns manifest clearly. Among the least developed and Gulf Cooperation Council countries, distinct subregional dynamics emerge. Conflict-affected countries require context-specific strategies. Recognizing these variations is vital for crafting effective and equitable solutions for achieving access to affordable, reliable, sustainable and modern energy for all.
Rural electrification and off-grid access policies
are key priorities for most least developed countries, given their sizable electricity access deficits. Mini-grids and solar home systems have gained recognition
as practical solutions for extending electricity access
in targeted geographical areas, particularly in rural and remote communities. However, the lack of comprehensive regulations and incentives has posed challenges in attracting investment in some countries.
Although Mauritania has identified access to energy
as a key development priority in various strategic documents, from its Poverty Reduction Strategy Paper (various editions) to the Accelerated Growth and Shared Prosperity Strategy, it did not have a national electrification plan as of 2021.13 The Production and Transmission Master Plan (2011) was the only technical document setting priorities for the power sector, focusing mostly on interconnecting and expanding the current network while identifying opportunities for increasing local production and transmission, including through off-grid solutions in remote areas.14 Little progress has been achieved in the last few decades. The proportion of the rural population with access to electricity fell from 3 per cent in 2000 to 0.8 per cent in 2012 (the latest year with available data in the ESCWA Arab SDG Monitor). This is among the lowest rates in the world, highlighting the critical need for a comprehensive strategy.
As of 2021, Somalia, the Sudan and Yemen had
each developed national electrification plans but comprehensiveness varied. Only the plans of Somalia and the Sudan include specific electrification access targets, incorporate off-grid solutions and encourage private sector financing. In contrast to Mauritania,
the Sudan has made significant progress in rural electrification in the last two decades. The proportion of the rural population with access to electricity increased from 4.4 per cent in 2000 to 24 per cent in 2012 and 49 per cent in 2021.
Replacing wood and charcoal stoves with clean fuels and advanced technologies for cooking, heating and lighting is considered a policy priority in most least developed countries. These countries are increasingly adopting policies or targets for clean cooking. The Comoros, Djibouti, Mauritania, Somalia and the
Sudan have included measures to scale up access to clean cooking solutions in their nationally determined contributions. The proportion of the population primarily reliant on clean fuels and technologies in the least developed countries has more than doubled over the past two decades, rising from 23 per cent in 2001 to 37 per cent in 2011 and reaching 51 per cent in 2021. Nevertheless, the subregional average still lags significantly behind the averages for the region (88 per cent) and the world
(71 per cent). Substantial progress is essential to bridge this gap.15
The national plan of the Sudan to scale up access
to clean cooking solutions includes a targeted awareness-raising strategy to drive adoption, with tailored messages for both men and women, including on health. The plan does not set a goal of reaching universal access to clean cooking, however, nor does it set efficiency standards or adopt labelling schemes for clean cooking solutions. Importantly, the Government tracks household-level data on cooking solutions and provides duty and tax incentives for suppliers. The country’s updated nationally determined contribution sets a goal of replacing traditional inefficient wood stoves with improved cookstoves for 20 per cent of the rural population. This transition, coupled with associated biomass savings, is expected to result
in a reduction of 2.6 million tons of carbon dioxide-equivalent emissions by 2030.16
Gulf Cooperation Council countries are increasingly prioritizing the localization of their renewable energy sectors by supporting national companies, incentivizing the private sector to manufacture renewable energy components and provide services locally, and encouraging both the public and private sectors to rely on local providers. In Saudi Arabia, to support Saudi Vision 2030’s goal
of indigenizing renewable energy sectors, the National Transformation Programme 2020 sought to increase the percentage of local content in the total expenditure of the public and private sectors to 50 per cent by 2021, and to raise the percentage of private sector jobs localization to 24 per cent by the same year. Gulf Cooperation Council countries are seeking to optimize the use of available hydrocarbon resources. While they have set renewable energy targets, there is also a concerted effort to expand fossil fuel production and bolster downstream industries. In Bahrain, the National Development Strategy (2015–2018) emphasizes the assessment and further development of hydrocarbon assets to maximize economic benefits over their lifespan. This entails employing enhanced recovery techniques for existing reserves and conducting exploratory drilling to identify new sources of supply.
In Saudi Arabia, the National Transformation Programme 2020 sought to create 12,000 jobs in the hydrocarbon and minerals sectors in less-developed regions, as well as to attract 28 billion Saudi riyals in private sector investment in these sectors and regions. Most Gulf Cooperation Council countries are promoting or striving to promote a carbon circular economy, including through carbon capture and storage. Several countries, including Bahrain, Kuwait, Saudi Arabia and the United Arab Emirates, have incorporated carbon capture and storage measures in their nationally determined contributions. Despite having large-scale carbon capture and storage facilities in operation, Saudi Arabia and the United Arab Emirates have not enacted the broad range of policy measures to advance carbon capture and storage deployment typically seen outside the Arab region. Instead, the two countries have opted for a strategy focused on State ownership of carbon capture and storage facilities, at least in the early deployment stages, rather than creating policy frameworks to encourage private sector investment.17
 |
Inhabitants of rural and remote areas face significant disparities in access to energy services compared to their urban counterparts. They have lower access to electricity as well as clean fuels and technologies for cooking, heating and lighting. Energy poverty limits their opportunities to improve their livelihoods, leave poverty and access quality education, health care and other public services. | Algeria has made a sustained effort to electrify remote areas in the south of the country. For example, the Isolated Networks of the South Programme provided additional electrical energy production capacity of 566 megawatts from 2010 to 2018.
In Morocco, the Global Rural Electrification Programme has helped achieve nearly universal rural electricity access, with 99.9 per cent of the rural population having access to electricity in 2021 (see section B for more details). |
|---|---|---|
 |
People living in poverty are more likely to lack access to electricity and clean fuels and technologies for cooking, heating and lighting. In addition, they often must devote a significantly higher share of their incomes to access energy compared to wealthier individuals. | In Mauritania, the Government has established a financing mechanism for low-income households and other vulnerable groups (such as female-headed households, informally settled people and displaced persons) regardless of the technology supply (grid, mini-grid or off-grid).
In the Sudan, a social or lifeline tariff mechanism supports grid-connected low-volume consumers. |
 |
Women and girls face considerable challenges due to energy poverty, which undercuts their well-being and economic prospects. Limited electricity access exacerbates time povertya and places a heavier burden of unpaid care and domestic responsibilities on women. Women are disproportionately vulnerable to premature mortality due to indoor air pollution resulting from the use of unclean cooking fuels. Furthermore, their representation in key public sector roles responsible for energy policies and programmes remains insufficient. Moreover, their participation in the energy sector workforce in the region is less than 15 per cent, significantly below the global average of 22 per cent.b | In the Sudan, the national plan to scale up access to clean cooking solutions takes the gender-based impact of cooking practices into account. It also includes a targeted awareness-raising strategy to drive adoption, with tailored messages for both men and women, including on health. |
Source: ESCWA Arab SDG Monitor.
Across the Arab region, a variety of financing mechanisms are driving the uptake of clean energy solutions. Several instruments prioritize de-risking strategies to overcome investment barriers and mitigate perceived risks. Guarantee mechanisms to address political and currency risks are particularly crucial for least developed and fragile countries.
National public funds dedicated to supporting the energy transition include the Renewable Energy and Energy Efficiency Fund in Jordan, the Fund to Support Renewable Energy and Energy Efficiency in the Syrian Arab Republic and the Energy Transition Fund in Tunisia.
Credit lines and revolving funds with banks facilitate energy efficiency initiatives in industrial, residential and municipal sectors in some countries, including Algeria, Jordan, Morocco and Tunisia. One notable example is the Municipal Energy Efficiency Programme in Jordan, administered
by the Cities and Villages Development Bank.
It promotes investment in renewable energy
and energy efficiency infrastructure, including rooftop solar photovoltaic systems, street
lighting refurbishments and energy efficiency enhancements in public buildings.21
Green bonds to finance clean energy initiatives have been issued in Morocco, Qatar and the United Arab Emirates, as well as by regional and multilateral financial institutions with projects in the region. For example, the Islamic Development Bank committed $110 million from its first sustainable sukuk (a sharia-compliant sustainable bond) to a photovoltaic solar power plant in the United Arab Emirates.22
Blended finance can make projects more attractive to private investors by mitigating risks and providing initial funding. For example, the Northern State Photovoltaic Fund of the Sudan leveraged $4.3 million from the Global Environment Facility and $2.5 million to $3 million in government funds to attract a further $17.9 million in investment from 11 commercial banks. This enabled a subsidy scheme that made solar-powered irrigation accessible to farmers. Building on this success, a National Photovoltaic Fund has been developed, extending benefits to farmers across the country.23
Customs and tax incentives and facilities can be used to promote clean renewable energy projects, as in the Syrian Arab Republic, where Investment Law No. 18 of 2021 extended full exemption from financial, customs and non-customs duties and a substantial 50 per cent reduction in income tax for a decade, and stipulated the provision of essential land for project establishment. Incentives and facilities have also been provided to encourage clean energy use, such as for the acquisition of emissions-free electric cars in Oman or the use of renewables in heating and cooling systems in Lebanon, Morocco and Tunisia.
1. The 17 Arab countries surveyed by the Energy Sector Management Assistance Programme were Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Mauritania, Morocco, Oman, the State of Palestine, Qatar, Saudi Arabia, Somalia, the Sudan, Tunisia, the United Arab Emirates and Yemen (ESMAP, 2022). section, “17 countries” refers specifically to these countries.
2. Algeria, Bahrain, Egypt, Jordan, Lebanon, Morocco, Oman, the State of Palestine, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates (ESMAP, 2022).
3. Long-term power purchasing agreements mitigate risks for developers, rendering investments in renewable energy projects more attractive.
4. Algeria, Egypt, Jordan, Lebanon, Morocco, Oman, the State of Palestine, Tunisia and the United Arab Emirates (ESMAP, 2022).
5. ESMAP, 2022.
6. IRENA, 2022.
7. Ibid.
8. ESCWA, 2017.
9. The 16 countries with national energy efficiency action plans or legal frameworks in 2021 were Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, the State of Palestine, Qatar, Saudi Arabia, Somalia, the Sudan, Tunisia, the United Arab Emirates and Yemen. Mauritania did not have a national action plan or legal framework in place. Information was not available for the Comoros, Djibouti, Iraq, Libya and the Syrian Arab Republic (ESMAP, 2022).
10. Algeria, Bahrain, Egypt, Jordan, Oman, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates (ESMAP, 2022).
11. Algeria, Lebanon, the State of Palestine, Qatar and the United Arab Emirates (ESMAP, 2022).
12. The United Arab Emirates, Ministry of Energy and Infrastructure, 2023.
13. ESMAP, 2022.
14. Sustainable Energy Fund for Africa and African Development Bank, 2019.
16. The Sudan, 2021.
17. Global CCS Institute, 2018.
18. This country subgroup includes Iraq, Libya, the State of Palestine, Somalia, the Sudan, the Syrian Arab Republic and Yemen.
19. ESCWA, 2023a.
21. ESCWA, 2021.
22. ESCWA, 2023b.
23. UN DESA, 2023.
24. ESCWA, 2023c.
Alkousaa, Riham and Friederike Heine (2023). Consortium signs $34 billion MoU for hydrogen project in Mauritania. Reuters, 8 March.
The Comoros (2018). Stratégie de croissance accélérée et de développement durable (SCA2D) 2018–2021.
Economic and Social Commission for Western Asia (ESCWA) (2017). Developing the Capacity of ESCWA Member Countries to Address the Water and Energy Nexus for Achieving Sustainable Development Goals: Water–Energy Nexus Operational Toolkit – Renewable Energy Module.
__________ (2021). Toolkit for Energy Efficiency Financing Instruments for Buildings in the Arab Region.
__________ (2023a). War on Gaza: weaponizing access to water, energy and food.
__________ (2023b). Annual SDG Review 2023: The private sector and the SDGs in the Arab region.
__________ (2023c). Review of progress in the Arab region under the Decade for Sustainable Energy.
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Energy Sector Management Assistance Program (ESMAP) (2022). Regulatory Indicators for Sustainable Energy (RISE). Washington, D.C.: World Bank.
Global CCS Institute (2018). 2018 Thought Leadership Report: CCS Policy Indicator (CCS-PI).
Hamdy, Habiba (2022). Egypt signs 7 MoUs with regional, int’l partners to produce green hydrogen. Ahram Online, 7 December.
International Energy Agency (IEA) (2023). Renewable Hydrogen from Oman: A Producer Economy in Transition.
International Renewable Energy Agency (IRENA) (2022). Renewable Energy Targets in 2022: A Guide to Design. Abu Dhabi.
McKinsey (2023). Using digital and AI to meet the energy sector’s net-zero challenge. Quantum Black, 18 July.
Morsy, Ahmed (2022). Green hydrogen bonanza. Ahram Online, 22 August.
Neom Green Hydrogen Company (2023), accessed on 14 February 2024.
Oman (2022). The Sultanate of Oman’s National Strategy for an Orderly Transition to Net Zero.
The Sudan (2021). First Nationally Determined Contribution Under the Paris Agreement: Updated.
Sustainable Energy Fund for Africa and African Development Bank (2019). Mini-Grid Market Opportunity Assessment: Mauritania.
The United Arab Emirates, Ministry of Energy and Infrastructure (2023). National Hydrogen Strategy. Abu Dhabi.
United Nations Conference on Trade and Development (UNCTAD) (2023). State of Commodity Dependence 2023. Geneva.
United Nations Department of Economic and Social Affairs (DESA) (2023). Promoting the Use of Electric Water Pumps for Irrigation in Sudan. Accessed on 16 February 2023.
United Nations Entity for Gender Equality and the Empowerment of Women (UN Women) (2020). World Survey on the Role of Women in Development 2019: Why Addressing Women’s Income and Time Poverty Matters for Sustainable Development. New York.
Vickery, Clair (1977). The Time-Poor: A New Look at Poverty. Journal of Human Resources, vol. 12, No. 1, pp. 27–48.
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