DNV and the Royal Norwegian Embassy business networking event – Saudi Edition

The DNV Energy Transition Outlook 2025 presents a comprehensive forecast of the global energy system through 2060, highlighting both progress and persistent challenges. The report maintains its long-standing prediction of a shift from today’s 80/20 fossil/non-fossil energy mix to a 50/50 balance by 2050. While renewables like solar and wind are accelerating—expected to provide over 50% of electricity by 2040—grid constraints and policy reversals, particularly in the U.S., are slowing the pace of transition. AI and EVs are reshaping electricity demand, but emissions are projected to decline only 63% by 2060, falling short of Paris Agreement targets. The forecast warns of a likely global warming of 2.2^oC by 2100, underscoring the need for faster action and deeper decarbonization.

Carbon Capture, Utilization, and Storage (CCUS) presents both significant challenges and promising opportunities for the MENA region as it seeks to decarbonize its energy-intensive economies. With vast geological formations suitable for CO₂ storage and a strong industrial base, countries like the UAE, Saudi Arabia, and Oman are well-positioned to lead regional CCUS deployment. However, barriers such as high capital costs, limited policy frameworks, and fragmented infrastructure remain critical hurdles. International experience underscores the importance of clear regulatory environments, public-private partnerships, and hub-based business models that separate capture, transport, and storage responsibilities to reduce risk and improve scalability. Lessons from regions like North America and Europe show that aligning CCUS with hydrogen production, industrial decarbonization, and negative emissions technologies can accelerate adoption. For MENA, integrating CCUS into broader energy transition strategies—especially in hard-to-abate sectors—offers a pathway to maintain economic competitiveness while meeting climate goals.

Utility-scale Battery Energy Storage Systems (BESS) are transforming power grids by enabling greater security of supply, deeper renewable energy integration, and a more decentralized and flexible energy system. These systems stabilize the grid by storing excess electricity during periods of high generation—such as midday solar peaks—and discharging it during demand surges, thereby mitigating intermittency and reducing reliance on fossil fuel peaker plants. BESS also provide critical ancillary services like frequency regulation, voltage support, and load shifting, which are essential for modernizing grid infrastructure and building the “grid of the future.” In the MENA region, where solar and wind resources are abundant but variable, BESS is emerging as a cornerstone of energy transition strategies. Countries like Saudi Arabia and the UAE are rapidly scaling up BESS deployments to support ambitious renewable targets and flagship projects such as NEOM and the Red Sea development. As the region pivots from fossil-based systems to clean energy, BESS offers a pathway to enhance grid resilience, unlock the full value of renewables, and meet growing energy demands sustainably.