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How Blockchain Can Support the Middle East’s Green Energy Transition

How Blockchain Can Support the Middle East’s Green Energy Transition

Last Updated on February 1, 2024 by Ameer Hamza

Climate change has taken the central stage across the world. Countries and international organizations are adopting policies to reduce climate change and sustain the environment. The Middle East is not left out. Many Middle Eastern governments are seeking options to transition to renewable energy in their countries. These moves are unsurprising, as the Middle East is projected to be the worst hit by climate change. This article discusses how blockchain technology can facilitate a transition to green energy in the Middle East.

Green Energy Transition in the Middle East

While many Middle Eastern countries have boosted their economies through oil revenue, most seek to diversify their economies and break their reliance on fossil fuels. For example, Saudi Arabia recently announced plans to build Neom city. Neom is a $500 billion sustainable city that is expected to operate on zero-carbon energy. This city will represent a complete transition to green energy for Saudi Arabia. Other countries like UAE have released ambitious plans to adopt a 44% green energy integration by 2050.

How Blockchain Can Help with Middle East’s Transition

Blockchain technology has several use cases that can boost renewable energy transition in the Middle East. Some of these use cases include:


One of the significant challenges with green energy transition is the risks of constructing green energy projects. Factors like weather irregularities can affect the lucrativeness of the project. However, some insurance companies provide payouts to cover these events. Blockchain’s smart contracts facilitate these insurance payouts. For example, if insurance payouts for a wind farm are paid when the wind level is below a certain level, the smart contract will use external data to determine wind levels. Once the wind hits the payout level, the smart contract automatically releases the payout. This feature can promote the Middle East’s energy transition by reducing the risks with renewable energy projects.

Green Bond Ratings: 

Green bonds are financial instruments used to fund projects that contribute to the environment. These bonds are essential to achieving energy transition, as they finance green energy projects. However, investors can be reluctant to invest in these bonds because some companies falsely describe some instruments as green bonds. Blockchain can help eliminate these challenges through oracles. These oracles will collate external information from auditors to rate each bond. This way, investors will verify green bonds.

Rewarding Green Energy Customers:

Green energy users are the most critical players in the green energy transition. Many companies have adopted systems that reward customers for using renewable energy and reducing energy consumption. Blockchain can help with this by tracking energy consumption on smart grids and releasing payments to customers. This system will encourage more people to use clean energy.


The Middle East is already experiencing the drastic effects of climate change. This is why Middle Eastern governments must explore the blockchain option to achieve a green energy transition in the region.

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