Energies 2015, 8, 8263-8285; doi:10.3390/en8088263 OPEN ACCESS energies ISSN 1996-1073 www.mdpi.com/journal/energies Article Barriers, Risks and Policies for Renewables in the Gulf States Johan Lilliestam †,* and Anthony Patt † Institute for Environmental Decisions, Climate Policy Group, ETH Zürich, Universitätstrasse 22, 8092 Zürich, Switzerland; E-Mail:
[email protected] † These authors contributed equally to this work. * Author to whom correspondence should be addressed; E-Mail:
[email protected]; Tel.: +41-44-632-6037. Academic Editor: Vincenzo Dovì Received: 28 February 2015 / Accepted: 16 July 2015 / Published: 5 August 2015 Abstract: The countries of the Gulf Cooperation Council (GCC) have both large fossil fuel resources and vast renewable energy potentials. Here, we investigate in a literature meta-analysis and a survey, whether there is a need for renewables in the GCC, what barriers and risks presently deter investments, and what possible policy-solutions could be. We find that there is a long-term need for renewables, to diversify the economy and prepare for a post-fossil fuel era. In the short term, two main obstacles deter investments: inefficient bureaucracy, and the combination of fossil fuel/electricity subsidies and the absence of renewable energy support. Removing fossil fuel and consumption subsidies or introducing a support scheme could make investments in renewables profitable. Eliminating energy subsidies appears particularly beneficial to the economic outlook but this seems particularly difficult to implement, due to the political economy of rentier states. Increased bureaucratic transparency and efficiency is needed, so that potentially attractive investments can rapidly and predictably obtain the necessary permissions.