A methodology for quantitative and objective Renewable Energy Market Competence Index is developed. The proposed index includes 18 different quantitative indicators; among them 13 are general indicators covering the political, economical situation of the country, and the energy sector, and 5 are technology specific that change from a renewable energy technology to another. In this part of the work, data are collected for the 13 general indicators for 8 Arab countries and 10 benchmark countries. In addition, the methodology of calculating the final index is presented.
With the world energy crisis intensifying year after year with the depletion of fossil fuel, especially oil, governments, investors, and research institutions are moving fast to exploit the available potential of renewable energy resources worldwide. It becomes of interest to governments that have large renewable energy potential, and have the need to exploit them to show the huge market they have to attract investors. Equally important, governments would like also to show – if exist – that they have very good industrial base, qualified personnel, and good incentives for renewable energy projects which all make the renewable energy market of the country very competent relative to other countries. On the other hand, it is also of interest to investors to be able to identify countries that have large renewable energy potential with very open and attractive business conditions. All of these demands by these different players can be met with the existence of an index that can quantitatively measure the competence of renewable energy market in different countries.
While there are many indices in literature developed by international institutions, organizations, international consulting firms, and by many researchers, few exist for the energy sector. In 2007, Volkan Ş. Edigera et al. developed the Fossil Fuel Sustainability Index to measure the sustainability of oil, natural gas, and coal of different countries [1]. On the other hand, since 2003, Ernst & Young, a leading international consulting firm in business development, is publishing its Renewable Energy Country Attractiveness Indices on quarterly basis [2]. While the later index now includes more than 40 countries and covers all types of renewable energy technologies, the index is partially objective and partially subjective. The subjectivity component of this index arises from the fact that a good part of the information collected is based on open essay questionnaire that are evaluated based on the experience of the operating team. The aim of this work – that is presented in 2 consecutive papers – is to develop an index that is exclusively objective and thus independent of the experience of the evaluator.
In this first part of the work, the full hierarchy of the proposed index is presented along with description of all involved 18 indicators, where only general indicators will be calculated. This paper is organized as follows; Section 2 sets the assumptions in countries' governments that are needed to properly interpret the values of indicators. Section 3 shows the overall hierarchy of the proposed index. Section 4 introduces the list of countries, the data sources, the index type, and score range of the final index. Section 5 discuses 3 indicators covering the political and economic situation of the country. Section 6 discuses 8 indicators that map the energy sector of the country, followed by Section 7 that covers financial and environmental issues. Section 8 is dedicated to discuss the 5 technology specific indicators where no data is provided for these indicators as they will be applied to the Concentrated Solar Power (CSP) technology in a separate paper as a second part of this work. After describing all 18 indicators, Section 9 illustrates the methodology to calculate the proposed Renewable Energy Market Competence Index followed by conclusion in Section 10. In part 2, this methodology will be applied to CSP technology and thus the final index score and rank will be calculated and determined respectively.
In conclusion, from one hand it is much easier and less resource intensive to work with a completely objective index to evaluate the market competence towards RE technologies than to apply a subjective index like the Renewable Energy Country Competitive Index. Relying only on raw data and applying simple mathematical equations to calculate the indicators and consequently the whole index ensure that human subjectivity is factored out and the final countries score and rank are based solely on mere facts. On the other hand, the proposed index requires the inclusion of many quantitative indicators (18 in this proposed work) in order to give a close-to-complete evaluation of the country's market regarding RE technologies.
