UAE can’t rely on oil and gas alone

The building of four nuclear reactors is part of the country’s long-term energy strategy

The UAE's nuclear energy programme is based in Barakah in the Western Region. Courtesy Emirates Nuclear Energy Corporation

The UAE is leading a “regional renaissance” in nuclear energy after Fukushima, said one leading expert in our story yesterday. We are currently building four nuclear reactors, in one development in the Western Region. In four years, nuclear energy is expected to produce a quarter of our needs.

But why would a country blessed with so much oil and gas seek such an expensive alternative? In fact, surprisingly little of our oil reserves are used for power generation – most of it is exported. It is our gas that is mainly used for power, as well as some renewables.

Yet even that carries a cost, what economists call an opportunity cost. Simply put, if a unit of gas is used for domestic energy, that is a unit of gas that we cannot sell abroad for hard cash. During the height of gas prices a few years ago, that, of course, was a significant cost. Gas prices have dropped recently, but they will probably rise again.

But freeing up gas for export is only part of the reason why the country is keen on nuclear power. Another is security: particularly with gas, we get more gas from abroad than we sell, making us reliant on imports for at least part of our energy mix. That creates the possibility of disruptions. Although lots of gas comes from friendly sources, there is always the chance that global events impact our ability to generate power – a situation no country wants to be put in. Having nuclear reactors means that a big part of our energy needs will be within our own borders.

The other element is education. For now, much of the expertise for building nuclear power plants comes from South Korea. But that will change, as Emiratis gain the necessary training and experience. In time, the education that comes from a domestic nuclear programme could prove at least as valuable as the energy the programme produces.

Building nuclear reactors is a long-term policy. Yet the gains that come from having a domestic industry are equally long-term, and will open up new opportunities well into the future.