Analysis of Saudi Arabia's Role in Global CO2 Emission Reduction

This report examines Saudi Arabia's role in global greenhouse gas reduction, particularly focusing on the country's efforts to meet the COP 21 target of limiting the global temperature increase to within 2%. As a major crude oil producer and significant CO2 emitter, Saudi Arabia's energy policies and strategies are crucial for achieving global climate goals. The study analyzes the country's potential for reducing emissions in the power generation sector, highlighting the importance of transitioning from renewable energy sources to non-renewable energy, such as Carbon Capture and Storage (CCS). The report evaluates the economic viability of CCS, considering falling oil prices and the potential for reducing energy production costs. Furthermore, it explores the impact of energy-efficient technologies, the measurement of CO2 avoidance costs, and the role of nuclear power. The analysis suggests that CCS is the most cost-effective strategy for CO2 emission reduction, ensuring clean energy consumption and achieving a break-even price of around $62/bbl by 2045, with a CO2 avoidance cost of $30/Ton. The report emphasizes the need for research and development to optimize fossil fuel use and underscores the link between crude oil prices and the economic viability of GHG emission reduction processes. The findings indicate that restricting CO2 consumption will lower the breakeven price for CO2 and subsequently decrease crude oil prices, ultimately reducing the demand for conventional energy sources.

Running head: ENGINEERING ECONOMY
Engineering Economy
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Name of the University
Author Note

1ENGINEERING ECONOMY
Summary
The objective of the COP 21 is to control the limit of the increasing rate of the global
temperature within 2%. This agreement has been signed by approximately countries across the
world. In this respect, the paper has attained to analyze the role of Saudi Arabia in achieving the
global target in order to mitigate the CO2 emission (Alshammari & Sarathy 2017). The data
asserts that Saudi Arabia is the largest crude oil producer in the international oil market. Apart
from that, the country is considered as one of the largest CO2 emitter. The continuous growth in
the energy consumption in the domestic and international market has been reported as the driving
force of this massive amount of energy production in Saudi Arabia. It is projected that Saudi
Arabia will be capable of meeting the global greenhouse gas reduction in the power generation
field by 80% if it shifts its focus from the renewable energy product to production of the non-
renewable energy. In terms of the researchers, the country will achieve sustainability in the
energy production with the implementation of Carbon Capture and Storage (CCS). On the
account of falling oil price, it will be best possible option for the Saudi Arabia government to
invest in CCS. In this way, the cost of energy production will be progressively lower till the year
of 2040. Therefore, research and development is required to optimum use of the fossil fuel along.
According to the research paper, the energy demand will be exhibiting upward trend after the
implementation of the energy efficient technology, however, it will be lower than growth in the
energy demand without the energy efficiency technology. In this regard, the paper figures out an
important way to measure the CO2 avoidance cost. It has been evaluated that CO2 avoidance will
be amplified if nuclear power is used as the substitute of the solar energy or CCS. In respect of
the best cost-effective strategy, CCS is recommended as the best option for CO2 emission target.

2ENGINEERING ECONOMY
Further, clean consumption of energy products will be ensured. The optimum level of
breakdown price is projected at around $62/bbl by the year of 2045 while CO2 avoidance cost is
measured at about $30/Ton. Decarbonization of the production process is approachable when the
availability of the conventional combustion system will be extremely difficult for the consumer.
The energy crisis needs to be understood by the both energy producers and consumers.
Nonetheless, the price of crude oil is another important determinant to evaluate the economic
viability of the GHG emission process. The CCS-EOR project asserts that cost of alternative
energy technology is invariably lower than the opportunity cost of the CO2 reduction level.
Altogether, it will help to reduce the demand for the conventional energy. Apart from that, the
paper denotes that economic benefit is deeply associated with the enhanced oil recovery process.
The restriction on the CO2 consumption will cut down the breakeven price for CO2, which in
turn, causes fall in the crude oil price.

3ENGINEERING ECONOMY
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