The Role of Nuclear Power in the Middle East Electricity Industry

23 October 2015
Richard Druce

The power systems of the Middle East are facing a range of challenges, including keeping pace with rapid demand growth, rising costs, and a desire to moderate the environmental impact of the regional utility industry. These challenges, which are, in fact, common to many economies throughout the world, are leading utilities and policymakers to consider diversification away from reliance on locally produced fossil fuels to alternative sources such as renewables and nuclear.

This paper sets out an economic framework for identifying the least-cost mix of generation technologies, which is a key target for policymakers when assessing the potential advantages and disadvantages of alternative generation technologies, such as Combined- or Open-Cycle Gas Turbines, Solar PV and Nuclear. NERA’s modelling framework, implemented using the “Aurora” platform, uses a “fundamentals” approach to optimise the mix of these generation technologies. It can account for the different capacity values of alternative technologies, the impact of “intermittent” plant on thermal plants’ unit commitment costs, and the effects of trade between regional power markets on the optimal mix of generation capacity.

This paper illustrates the results of applying this framework to optimise the generation mix in the GCC power system (Kuwait, the Kingdom of Saudi Arabia, Bahrain, Qatar, the United Arab Emirates and Oman), and illustrates its potential to support regional utilities’ system planning activities. The paper also touches on a range of other considerations faced by governments in deciding whether or not to pursue a nuclear generation programme.