Towards a New Energy and Environmental Policy for Egypt: Development of Clean Sources in an Emerging Economy

Selim, Tarek (2010): Towards a New Energy and Environmental Policy for Egypt: Development of Clean Sources in an Emerging Economy. Published in: First Research Dialogue Conference on Emerging Economies, Indian Council for Research on International Economic Relations (ICRIER), New Delhi, India, April. (April 2010)

Abstract

Within the new world order, it is generally seen that sustainable development is a tradeoff between resource efficiency and social equity such that total resource essentials in society can become sustainable in the long run in a manner that meets the needs of current generations without compromising the ability of future generations to meet their own needs. Egypt as an emerging economy falls under this paradigm, which requires countries to adapt their natural resource management and energy policy directives towards new sustainability solutions.

An emerging economy such as Egypt, striving for its identity under a new world order, entails a shift in its energy policy away from traditional energy sources which are non-sustainable in the long run. This will require the inclusion of new policy dimensions related to energy conservation and efficiency, climate change, development of clean energy sources, and long run sustainability within a global perspective. Consequently, a new energy policy mandate is a critical requirement for Egypt’s future.

This mandate, however, will provide a solution to long run energy sustainability for the country so long as the following constraints are addressed: (1) it constitutes a necessary condition in the country’s path towards sustainable development, (2) it is implemented simultaneously as a target and constraint, and (3) social welfare and political sacrifice are complemented by incentive-based systems in contrast to authoritarian or universality solutions.

The objective of this study is to design a new energy policy mandate for Egypt as an emerging economy within the new world order along national policy directives and global governance measures. In particular, an analysis of the Egyptian energy sector will be conducted from an energy sustainability perspective, including analysis of traditional hydrocarbon (oil and gas) energy sources, energy conservation and efficiency targets, feasibility and requirements for the development of alternative clean energy sources (such as nuclear energy, solar energy, and other alternatives), and the crafting of an overall comprehensive energy policy mandate for the country’s future. Reflections and policy directives on sustainable development for Egypt, emerging economies, and global governance will be addressed.

• Item Type: MPRA Paper
• Language: English
• Keywords: Clean energy, Egypt, sustainable development, fossil fuels, petroleum, natural gas, nuclear energy, solar energy, renewable energy, non-renewable energy, environmental policy, energy policy, emerging economies
• Subjects: C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General; C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C15 - Statistical Simulation Methods: General; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q2 - Renewable Resources and Conservation; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q3 - Nonrenewable Resources and Conservation; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q41 - Demand and Supply ; Prices; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q42 - Alternative Energy Sources; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q48 - Government Policy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q56 - Environment and Development ; Environment and Trade ; Sustainability ; Environmental Accounts and Accounting ; Environmental Equity ; Population Growth; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q58 - Government Policy

References

AmCham (American Chamber of Commerce in Egypt). (2003). The Petroleum industry in Egypt: Investment and prospects. Business Studies and Analysis Center. Cairo, Egypt: The American Chamber of Commerce in Egypt.

American Chamber of Commerce. (2005). Egypt’s petroleum sector. Business Studies Division Sectoral Reports.

APRC (Arab Petroleum Research Center). (2003). Egypt: Arab oil and gas directory. Arab Petroleum Research Center, Paris, France, pp.85-120.

Boulding, Kenneth (1978). Ecodynamics: A New Theory of Social Evolution. Sage Publications.

Cairns, Robert and Zhao Yang. (2000). The converse of Hartwick’s rule and uniqueness of the sustainable path. Natural Resource Modeling 13 (4), pp.1-10.

Clarkson, Richard and Kathryn Deyes (2002). “Estimating the Social Cost of Carbon Emissions”. UK Government Economic Service Working Paper. WP 140.

Coase, Ronald (1960). “The Problem of Social Cost”. Journal of Law and Economics vol. 3, no. 1, pp. 1-44.

Colliti, Marcelo and Claudio Simeon. (1996). Perspectives of oil and gas: The road to interdependence. London: Kluwer Academic Publishers.

Conlisk, J. (1996), “Why bounded rationality?”, Journal of Economic Literature, 34, 669–700.

Dasgupta, Partha (2004). Human Well Being and the Natural Environment. Oxford University Press.

Dasgupta, S. (1966). Technology and Creativity. Oxford University Press.

Davenport, Thomas and Laurence Prusak (1998), “Working Knowledge: How Organizations Manage What They Know”, Harvard Business School, Harvard

De Neufville, R. (1990). Applied systems analysis: Engineering planning and technology management. New York: McGraw-Hill.

Egyptian Ministry of Electricity and Energy (1994), Annual Report, Cabinet of Ministers of the Government of Egypt, Cairo, Egypt.

EIA (Energy Information Administration) (2007). Nuclear energy basics. U.S. Department of Energy.

El-Leithy, Heba (2001), “Gender Dimensions of Poverty in Egypt”, Economic Research Forum of the Middle East, vol. 8., no. 2, October 2001.

Energy Information Administration (EIA) (2006). Country analysis: Egypt. Washington, D.C.: US Department of Energy (US DOE).

ESIF (1994), European Solar Industry Foundation, “Solar Thermal Strategy Study: Egypt”, Kempten, Germany.

Fahmy, Sameh (2006); Egyptian Minister of Petroleum and Natural Resources, press release, April 3, 2006.

Genio, D. Koch, A. Lacis, K. Lo, S. Menon, T. Tovakov, Ju. Perlwitz, G. Russell, G.A. Schmidt, and N. Tausnev, “Earth's energy imbalance: Confirmation and implications”, Science 308, 1431-1435.

Hanley, Nick, Jason F. Shogren and Ben White (1997). Environmental economics: In theory and practice. Oxford: Oxford University Press.

Hansen, J. (2004), co-authored by L. Nazarenko, R. Ruedy, M. Sato, J. Willis, and A. Del, “Investment Grade Energy Audit: Making Smart Energy Choices”, Fairmont Press.

Hardin, Garrett (1968). "The Tragedy of the Commons." Science 162: 243-48.

Hartwick, John M. 1977. Intergeneration equity and the investing of rents from exhaustible resources. The American Economic Review 67 (5) pp.972-74.

IAEA (International Atomic Energy Agency) (2007). Country fact-sheet: Egypt.

IAEE (International Association for Energy Economics) (2007). Nuclear power generation.

IDSC (Information and Decision Support Center) (2008). www.idsc.gov.eg, June.

Jevons, W. (1865) Pure Logic, E. Stanford.

John Ericsson Society (2007), Renewable Energy History Project, New York.

Kahneman, D. and Tversky, A. (1979), “Prospect theory: An analysis of decisions under risk”, Econometrica vol. 47 no. 2, pp. 263-292.

Kahneman, D., Slovic, P. and Tversky, A. (1982), Judgment under Uncertainty, Cambridge University Press.

Kassas, M. (1957). On the ecology of the Red Sea coastal land. Journal of Ecology 45: 187-203.

King, D., M. Mannville and D. Shoup (2007), “The Political Calculus of Congestion Pricing”, Transport Policy, vol. 14, pp. 111-123.

Kristiansen, Tarjei. (2007). Nuclear power generation. International Association for Energy Economics (IAEE) Newsletter, third quarter.

Kuznets, Simon (1969), Modern Economic Growth: Rate, Structure, and Spread, Yale University Press, 1969.

LeBel, Philip G. 1982. Energy economics and technology. Baltimore: The Johns Hopkins University Press.

Machiavelli (1532), The Prince, Oxford World Classics, Oxford University Press, Reprinted 1998.

Mankiw, N. Gregory (1992), “A Contribution to the Empirics of Economic Growth”, Quarterly Journal of Economics, Volume C7, May 1992.

Middle East Economic Digest (2003), Egypt: Petrochemicals, January 2003.

Mikhail, G. (2004). Egypt's Wilderness and the Quest for Conservation. American University in Cairo Press, Cairo.

Mill, J.S. (1957) Utilitarianism. Indianapolis: Bobbs-Merrill, 1957.

Milton, Samuel and Steven Kaufman (2005), "Solar Water Heating (SWH) as a Climate Protection Strategy: The Role for Carbon Finance", Green Markets International, USA.

MIT (Massachusetts Institute of Technology) (2003). The future of nuclear power. Nuclear Energy Experts Committee Report, Program on Science, Technology, and Public Policy.

Mohamed Elmenshawy (2005), “America through Mopic Arab Eyes”, International Herald Tribune, Friday November 4.

Mullainathan, S. and R. Thaler (2000), “Behavioral Economics”, NBER Working Paper 7948, National Bureau of Economic Research Working Paper Series.

Munasinghe, Mohan (2008). Sustainable Development in Practice: Sustainomics Methodology and Applications, Cambridge University Press.

NPPA (Nuclear Power Plant Authority) (2008). Written communication.

NREA (2005), The Egyptian New and Renewable Energy Authority, "Strategy and Mandate", Cairo, Egypt.

OFE (Office of Fossil Energy) (2001). An energy overview of the Republic of Egypt. Energy Overview. Washington, D.C.: Office of Fossil Energy.

Pearce, David (1992), MIT Dictionary of Modern Economics, Massachusetts Institute of Technology (MIT) Press.

Rao, P.K. (2000) Sustainable Development: Economics and Policy, Blackwell Publishers. reenpeace-report-proves-solar>

Sadat, Jihan (2002), A Woman of Egypt, Simon and Schuster Publishers.

Said, R. (1993). The River Nile: Geology, Hydrology, and Utilization. Pergamon Press, London.

Scott, James C. (1998), Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed, Yale University Press.

Seda, Rodrigo. (2005). Apache Egypt's contribution to the Egyptian national economy. The American University in Cairo Press.

Selim, Tarek (2009). Egypt, Energy and the Environment: Critical Sustainability Perspectives. Adonis and Abbey (UK) Publishers, London, 2009.

Selim, Tarek (2008), “Comparative Human Development: Egypt, Middle East, and the Developing World”, Social Science Research Network WPS 2008, and Proceedings of the International Academy of Business and Public Administration Disciplines, Orlando, FL, 2008.

Selim, Tarek (2007). On efficient utilization of Egypt’s energy resources: Oil and gas. The Egyptian Center for Economic Studies (ECES) Working Paper Series No. 117. Cairo, Egypt: ECES.

Sen, Amartya (1970). Collective Choice and Social Welfare (Amsterdam: North-Holland).

Sen, Amartya (1987). The Standard of Living (Cambridge: Cambridge University Press).

Simon, Herbert (1955), “A Behavioral Model of Rational Choice”, Quarterly Journal of Economics, vol. 69, February.

Smith, Adam (1904), The Wealth of Nations. London: Modern Library, 1904.

Soddy, Fredrick, (1912), Matter and Energy, Read Books, 1912.

Storper, M. (2000), “Globalization and Knowledge Flows: An Industrial Geographers perspective”, in Dunning, J (ed) Regions, Globalization and The Knowledge based Economy, Oxford University Press, pp. 42-62.

Straaten, J., and Tylecote, A. (1997) Environment, Technology, and Economic Growth: The Challenge To Sustainable Development, Edward Elgar Publishing Ltd., Massachusetts, USA, 1997.

Teske, Sven (2005), Greenpeace International, press release, 7 October 2005: <http://www.greenpeace.org/international/press/releases/

Thaler, R. H. (1985), “Mental Accounting and Consumer Choice”, Marketing Science, vol. 4-1985, pp. 199-214.

Toman, Michael. (2000), “Establishing and Operating the Clean Development Mechanism” Resources for the Future. Climate Issue Brief no.22. September. University Press, 1998.

Wadi Environmental Science Center (2008). <www.wesc.org>

Warren, Kenneth F. (1974), Review of Wildavsky’s (1973) Implementation: How Great Expectations in Washington Are Dashed in Oakland, The Journal of Politics, vol. 37. White, D. (1982), Optimality and Efficiency, John Wiley.

Wildavsky (1973), Implementation: How Great Expectations in Washington Are Dashed in Oakland, University of California Press.

Wilson, James Q., (1980), The Politics of Regulation, Basic Books, New York.

WNA (World Nuclear Association) (2005). The new economics of nuclear energy.

WNA. (2007). Emerging Nuclear Energy Countries Division. Egypt: Country Briefings.

World Bank. (2005). Egypt country profile. Washington, D.C.: World Bank.

World Energy Council (2008). Energy in Egypt. <www.worldenergy.org/wec-geis/wec-info/structure- organisation/ea/cairo/stats/eie.asp.>

World Energy Outlook. (2006). US Department of Energy (DOE). <www.eia.org>