Oil and gas-rich countries in the Arabian Gulf are eyeing renewables investments “out of self-interest”, the UN’s top climate official has told Climate Home.
In an interview from Abu Dhabi where she is attending a clean energy summit, Christiana Figueres said leaders in the heartlands of hydrocarbons saw a clear business case to invest in cleaner energy.
“They are operating out of self-interest to ensure they keep the hydrocarbon resources they have for export and not waste them internally,” she said.
“They can produce energy much cheaper from the sun and export their hydrocarbons.”
On Sunday, Figueres addressed the United Arab Emirates Crown Prince’s court, where she outlined the implications of last December’s UN climate deal signed in Paris by 195 countries.
The 32-page pact sets a timeline to radically cut global greenhouse gas emissions by the second half of this century, while governments agreed to divert funds from high carbon energy sources.
“They understand there is a shift – it has to be gradual but it is unstoppable,” she said.
Crashing oil prices have forced leaders in Saudi Arabia, Kuwait and the United Arab Emirates to consider rebalancing their hydrocarbon-heavy economies.
United Arab Emirates prime minister Sheikh Mohammed tweeted this week the country would be “celebrating the last drop of oil”, announcing he wanted to develop a more diversified economy.
“They are hunkering down to work out what is their strategic plan to take them beyond oil and gas,” said Figueres.
“They were already walking down the path but [Paris] has put the wind in their sails.”
The UAE has plans to radically upscale clean energy use from 7% in 2020 to 25% by 2030 and 75% mid-century, according to figures from the International Renewable Energy Agency (IRENA).
Saudi Arabia has responded to low oil prices – partly a result of the country refusing to restrict its production – by boosting petrol prices 50% and hinting at a total phase-out of energy subsidies.
Over 1000 officials and energy experts from 150 countries attended the annual two-day clean energy IRENA summit in Abu Dhabi, which ended with calls for greater clean energy investment from UN chief Ban Ki-moon.
Loans worth US$46 million for projects in Africa and Caribbean were announced on the sidelines of the event – a drop in the ocean compared to the $53 trillion the International Energy Agency says need to be directed towards wind, solar and other green energy initiatives.
Funding would rapidly increase over the next “several years” said Figueres, suggesting $500 billion a year would be flowing towards clean energy projects by 2020.
A new and more ambitious set of national climate plans to replace those filed ahead of Paris could also help, she suggested, given the 188 lodged with the UN leave the world on course to warm above 2C.
“The agreement says there will be a dialogue in 2018 which is when countries will get together for a review,” she said.
“That’s 3 years where many things can happen. And 2018 is the next milestone from where they will then decide on a new INDC [climate plan] for 2023.”
After Abu Dhabi Figueres heads to Davos, a Swiss resort that hosts leading lights from business, politics, academia and media for a four-day meeting every year.
From the Alpine snows, she will travel to New York to meet top investors and fund managers and explain why they should care about the UN’s new climate pact.
“There is no sector that is not interested in the impacts of climate – no sector that has not woken up to the fact we have a transformational moment,” she said.
“Paris was the moment when the future was made possible. The bottom line impact of Paris was that before Paris we lived in a world where it was the market that decided was possible.
“After Paris we live in world where community of nations has decided what want and need now we need to align the markets to make that possible.”
For more information, see: https://www.theguardian.com/environment/2016/jan/20/slump-in-oil-prices-drives-green-energy-take-up-in-top-exporting-nations, https://www.theenergymix.com/2016/01/08/saudi-arabia-oman-scramble-to-reduce-dependence-on-oil/