Exelon Corporation (EXC) and The Southern Company (SO): Keeping The Oil For Everybody Else

The United Arab Emirates is also home to the largest single-unit solar facility in the world: Shams-1. The facility, which just recently came online, generates about 100 megawatts of electricity at full capacity. The country plans on adding two more Shams-size projects in the next couple of years. Both Saudi Arabia and the UAE are joined by Bahrain, Oman, Qatar, and Kuwait as countries that have ambitious plans to increase solar generation capacity.

Keeping the oil for everyone else
For a region so rich in oil, it may seem peculiar to see such a move toward alternative energy. But oil is the exact reason they are doing this, or more specifically, oil exports. By reducing total petroleum consumption domestically, they are hoping that it will translate into greater export capacity and, in turn, greater revenues.

The move toward other power sources could save the Saudi Kingdom as much as 520,000 barrels of oil per day by 2032, which becomes instant export capacity.  At current prices, this would translate into an additional $19 billion per year in oil sales.

With North American oil production expected to increase over the next several years, countries in the Gulf Region need to do whatever is necessary to keep their position in the oil supply market. It appears as though solar and nuclear are a way to maintain that position longer than expected.

What a Fool Believes
As investors, there is a lesson to be learned here. These nations believe that they are too dependent upon one energy source domestically and, if anything in the international market were to drastically affect this product, they could be in trouble. By diversifying their domestic power generation, they will be able to mitigate this exposure. Investors in the energy space should take a similar approach. Rather than focusing on one single energy source as the end-all solution, try to have a diversified approach. The demand for energy is massive and still growing at a rapid pace, so nearly all sources of energy have a place in this market.

The article Why Are OPEC Countries Abandoning Oil Consumption? originally appeared on Fool.com.

Fool contributor Tyler Crowe has no position in any stocks mentioned. You can follow him at Fool.com under the handle TMFDirtyBird, on Google +, or on Twitter, @TylerCroweFool.The Motley Fool recommends Exelon and Southern Company. The Motley Fool owns shares of General Electric Company.

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