What will a post-COVID world look like and what can be the role of traditional oil producers like the UAE within it? Will it be a return to business as usual, whereby our economies and societies are fuelled by oil and gas and the associated increasing levels of pollution? Or will the future be a break with the past; one in which fossil fuels are used less and alternative ways of living and working become the norm?
Such questions are becoming more pressing, especially as the end of the pandemic is in sight. Now that a vaccine has been developed and its roll out has begun, it is worth exploring the prospects for the future.
Even before the pandemic began, there were moves to reimagine the future – especially once people experienced the pleasures of a cleaner environment. In the US, Democrats campaigned in 2018 for a Green New Deal, while in the European Union, in 2019, the new Commission began implementing its own. Recently, China, the world’s second largest economy, announced its goal of becoming carbon neutral by the middle of the century.
All this puts pressure on oil producers, especially those in the Gulf. However, some are more ready for this transition than others. The UAE is among them, which has organised the (virtual) Abu Dhabi Sustainability Week, taking place this week (January 18-21); it is arguably the region’s largest green event. Speaking at the conference, Masdar Chairman, Dr Sultan Al Jaber, indicated the route the country may go down, with his declaration that the UAE could become a ‘low-cost blue hydrogen producer’.
“The [UAE] government has pushed ahead with some of the most ambitious green targets, pledging to generate 24 percent of its electricity from clean sources by the end of this year and reducing its carbon emissions by 30 percent by 2030 through building and construction efficiency improvements”
Participants at the Week’s events will discuss and build on the UAE’s efforts in recent decades to reduce its dependence on hydrocarbons and diversify its economy. It is fast becoming a knowledge hub for the world’s most advanced clean energy technologies, alongside alternative energy sources. The government has pushed ahead with some of the most ambitious green targets, pledging to generate 24 percent of its electricity from clean sources by the end of this year and reducing its carbon emissions by 30 percent by 2030 through building and construction efficiency improvements.
Already Dubai is supporting the installation of solar panels on existing houses, and the neighbouring city of Sharjah has just started construction of a sustainable community where energy use will be net zero. Meanwhile, the Barakah Nuclear power plant opened last year. As well as reducing greenhouse gas emissions, it is expected to contribute 25 percent of the UAE’s entire power generation.
Like the UAE, other Gulf states have realised that alternative sources of energy are necessary. Saudi Arabia has pledged that 30 percent of its energy generation will come from renewables by 2030, while the Bahrainis have gone for a less ambitious 6 percent of its energy mix being renewable by 2025. Some will undoubtedly question whether these targets will be met, but the fact that these announcements were made at least shows Arabic governments are aware of the need to go greener.
While the efforts of the UAE and its neighbours is a good start, by itself it won’t be enough. Buy in is needed from younger generations, who are the ones most at risk to climate change and the challenge of preventing its escalation. For that reason, youth is a prominent feature at Abu Dhabi Sustainability Week.
According to last year’s Arab Youth Survey, environmental and sustainability concerns are capturing the attention of the region’s youth. Just over a fifth (22 percent) of respondents see the encouragement of technological innovation as a top priority, while nearly a third (32 percent) think that the Governments’ post-COVID responsibilities should include the creation of new well-paying jobs. Sustainability and green innovation can contribute to both these issues.
“Those Arab countries that can green and diversify their economies fastest will be ahead in that race, providing their younger citizens in particular with a better quality of life. Abu Dhabi Sustainability Week is a prominent reminder that these issues are already at the forefront of Arab leaders’ minds.”
Although the UAE has faced financial squeezes in terms of oil revenues and public spending as a result of COVID, its leadership has long seen the need to support employment and new technologies. Moreover, they see the pressures resulting from COVID and the wider global economic changes as not only a sign that they should act, but as an opportunity. Consequently, they have not been caught by surprise by the need to diversify. Indeed, it has been an important feature in its planning and strategies in recent decades, most notably in its current Vision 2021.
Countries across the Gulf, the wider Middle East, and indeed the globe, are in an economic race to respond to today’s challenges. Those Arab countries that can green and diversify their economies fastest will be ahead in that race, providing their younger citizens in particular with a better quality of life. Abu Dhabi Sustainability Week is a prominent reminder that these issues are already at the forefront of Arab leaders’ minds. COVID-19 has accelerated the move to a greener Middle East; the region’s youth will be what keeps up the momentum.