Past years have seen an enormous, yet insufficient, rise in public debates over climate change and, consequently, increased investments in sustainable development worldwide. Middle Eastern fossil fuel giants are now setting their own goals to mitigate climate change and are heavily investing in renewable resource enterprises. What motivates this relative change of heart and how much of a change it really is? Will Middle Eastern societies go green, or as the Arabic proverb “Deil Al Kalb Umruhu ma Ya’tadil” says: A dog’s tail can never straighten? A closer look at the sustainable energy reality of the United Arab Emirates (UAE), the leading sustainable innovator in the Middle East, shall provide a decent answer.
Ever since the first commercial oil discovery in 1958, the Emirati economy has been heavily reliant on fossil fuels. To this day, the energy supply market remains dominated by natural gas (63%) and oil (almost 30%)[1]. Furthermore, crude oil makes up to 80% of the energy production market, representing almost 16% of the UAE’s GDP – one of the highest GDPs per capita in the world, making the UAE the seventh largest liquid fuel producer in the world [2]. Over time, due to fossil fuels’ exhaustible nature, particularly evident in Dubai, the country’s GDP has diversified multiple times but remains heavily reliant on the fossils coming predominantly from Abu Dhabi.
Bearing this fossil-dominated reality in mind, it did not, however, come as a shock that one of the richest emirates, Dubai, hosted the 28th United Nations Climate Change Conference (COP28) in November 2023. The UAE was the first Middle Eastern nation to become a party to the Paris Agreement. The Agreement classifies participating countries into groups, primarily those historically responsible for greenhouse gas emissions (Annex I) and those without such a history (non-Annex I). The UAE falls into the latter category. Despite its non-Annex I status, which exempts it from mandatory emissions reductions, the UAE has set several ambitious goals towards a sustainable transition [3].
Emirates Go Green
Following the path set by the European Union, the UAE has embarked on reaching Net Zero (emissions) by 2050 [4] This strategy includes reducing carbon emissions to a minimal level that can be naturally absorbed and permanently stored, or removed through carbon dioxide removal methods, resulting in no remaining emissions in the atmosphere. Its concrete targets aligning with the Paris Agreement include limiting the rise in global temperature to 1.5°C above pre-industrial levels and reducing greenhouse gas emissions. Additionally, the strategy entails bolstering sustainable investments in renewable energy both domestically and globally. To meet its Net Zero 2050 target, the UAE has claimed to undertake more than 25 programs across six major polluting sectors: industry, buildings, transport, power, waste, and agriculture [5].
Furthermore, the UAE has been heavily investing in sustainable cities and energy-related R&D, predominantly through the flagship project Masdar. Masdar, Arabic for ‘source’, encompasses four initiatives – the Masdar Institute of Science and Technology, Masdar Capital, Masdar Clean Energy, and finally, Masdar City, a vast sustainable community project located in Abu Dhabi. All Masdar divisions set off to make Abu Dhabi a “preeminent source of renewable energy knowledge, development and implementation” and become a competitor to California’s Silicon Valley [6].
Masdar's overall ownership lies in the hands of the state-owned Mubadala Investment Company (MIC, an Abu Dhabi-owned sovereign wealth fund managing up to $300 billion in assets.) MIC’s portfolio ranges from real estate and infrastructure companies in China, to pharmaceuticals in France, a raw materials digital trading platform in Switzerland, a crypto trading platform, and Abu Dhabi National Oil Company (ADNOC). It is, therefore, fair to say that Mubadala Investment Company is a fervent for-profit investor, not a fervent sustainable development activist [7]. Besides being home to the International Renewable Energy Agency (IRENA), Masdar City is thought to be a tangible step toward Net Zero, a demonstration of a sustainable urban community design, and proof that “sustainability is not a choice, but a way of life” [8.] Nearly all materials used to construct the city are recycled. However, the sustainability of Masdar City, along with its younger sister, the Sustainable City in Dubai, is questionable. The delay in construction and relative isolation from other major cities raise questions about their purpose.
Domestically, the UAE is investing in nuclear, solar, and hydrogen sectors. The Emirates Nuclear Energy Company (ENEC), established in 2009, launched its first nuclear unit in Barakah in 2021 which accounted for 7% of the whole electricity generation mix in 2021 [9]. As the UAE’s geographic location supplies it with abundant sunshine, assertion into the solar energy market was inevitable. Ever since the first sustainable investment in 2006 the Emirates has profitably installed numerous domestic solar power plants, including the world’s largest single-site solar power plant – Al Dhafra Solar PV [10]. In contrast to days of sunshine, the Emirates’ location does not suggest fertile soil for wind energy. Despite the low winds, Masdar launched a domestic Wind Program in 2023, supposedly providing enough energy to power approximately 23,000 homes, making up approximately 10% of the total number of households [11][12]. As Jules Verne predicted many years ago, “water will one day be employed as fuel, that hydrogen and oxygen which constitute it, used singly or together, will furnish an inexhaustible source of heat and light, of an intensity of which coal is not capable” [13]. Two hundred years later, the world’s sustainable movement also emphasizes the significance of low-carbon, or zero-carbon, hydrogen. The UAE’s National Hydrogen Strategy of 2023 sets off to develop and implement low-carbon hydrogen alike whilst playing “a leading role in the global hydrogen economy” [14].
Sustainable partnerships
Internationally, the UAE has showcased its interest in transnational cooperation through sustainable investments and joint ventures. According to a Financial Times analysis, the UAE is expected to invest almost $200 billion in renewable energy worldwide [15]. Arguably, their energy-related partnerships represent a security web and entail their growing sphere of influence worldwide.
Estimated two-thirds of the UAE’s foreign renewable investments are directed at developed countries. The largest portion will be served to Turkey, with estimated $30 billion of Emirati capital. Such strategic capital allocation could be explained by the Emirati strive for a stable partnership with a regional military power at the crossroads between the East and the West. Surrounded by potential adversaries that could pose a potential threat to the UAE’s sovereignty, such as Saudi Arabia, establishing such a secure partnership would serve as a strategic advantage. The second largest receiver of Emirati foreign renewable capital is the United States. The tactical partnership the UAE formed with the US showcased in the UAE‘s foreign direct investments in the US and the airport pre-clearance, allowing travelers from Abu Dhabi to complete immigration and customs checks for the USA in the UAE, signifies a move towards establishing a friendship with the world’s largest economy, military superpower, and vehemently proud democracy. By securing these US and Turkish partnerships, the UAE establishes itself as a global and regional geopolitical power.
Emirati renewable investments have not been avoiding the Old Continent either. Following the Memorandum of Understanding with the major French government-owned electric utility company, EDF, on research and development in nuclear and hydrogen energy, the Emirates Nuclear Energy Corporation (ENEC) has been eyeing investments in European nuclear energy assets [16]. An Emirati investor has reportedly approached the Sizewell C nuclear power plant to invest in Suffolk after UK’s removal from the China General Nuclear Power Group project due to security concerns [17] [18]. Furthermore, the UAE has closed green hydrogen deals with partners in Germany andJapan, solar energy contracts with Indonesia, and many others [19] [20]. Thus, Emirati investments in Europe reflect the UAE's intention to be included in the energy mix of developed nations and, in some instances, to replace traditional superpowers with a long-established history of international development.
The African continent is also one of the destinations of Emirati renewable capital through the Africa50 initiative that sets off to aid developing countries towards a sustainable transition. Arguably, such initiatives extend the web of Emirati influence and transform their geopolitically vulnerable position into a source of influence [21].
Yet fossils still prevail…
The Emirati domestic and foreign investments undeniably show a great interest in playing an active role in the post-fossil world. However, the Emirates also understand that the present reality is still fossil-fuelled. Because of the large global oil and gas demand and the UAE’s inarguably enormous fossil reserves, the country continues to pump out as much as it can. This fact alone would not come across as a surprise – the fossil fuels are exhaustible, and the demand grows; thus, a country continues to export while actively trying to switch to green energy. In the case of the UAE, it is not that simple. Months before hosting the COP28, which was to hold clean energy-related talks, the government-owned major oil company ADNOC introduced an ambitious $150 billion plan to “accelerate growth and strategy“ for oil and gas production [22].ADNOC’s commitment to expanding is reflected in the acquisition of a 30% stake in Azerbaijan’s condensate gas field, a 50% ownership gas deal with Israel worth $2 billion [I], and a planned 10% stake in a gas project in Mozambique [23][24][25]. Additionally, $17 billion have been allocated to exploiting the Hail and Ghasha offshore gas fields [II]. Once constructed, the Ghasha concession will be producing over 1.5 billion cubic feet of gas per day by 2030. ADNOC claims that the project has the potential to become a flagship for carbon capture and low-carbon production. Whilst such marketing rhetoric helps the UAE build an image of a sustainable partner, it has failed, however, to reflect on the fact that such production remains a significant emitter, even with low-carbon technology [26]. ADNOC further argued that the project would create jobs and “responsibly unlock its gas resources to enable gas self-sufficiency for the UAE, grow export capacity and support global energy security” [27]. While this may be true, questions arise regarding the effectiveness and real motivation behind these green energy projects. In a world of accelerated climate warming, two major ongoing regional wars, and exposed energy security, are fossil fuels really the most responsible bet? As a result of these ambivalent energy objectives, the independent scientific project Climate Action Tracker (CAT) estimates that the UAE will not achieve the set goals due to its heavy fossil fuel dependence and ongoing investments in hydrocarbons [28].
When confronted with questions about the contrasting national energy interests, COP28’s chair Sultan Al Jaber responded that there was no scientific evidence of fossil fuels’ impact on climate. When opposed by Mary Robinson, former UN special envoy for climate change, he even blamed her for trusting biased media. Al Jaber’s dual professional role best reflects the UAE’s energy position. While he holds office as president of Masdar, the UAE Special Envoy for Climate Change, and chaired COP28, he is also the Minister of Industry and Advanced Technology and the CEO of ADNOC. He talks about the need for joint action against climate change yet denies fossil fuels’ role in the climate crisis. [29] [30]
What motivates the sustainable course then?
An MIT Technology Review analysis shows that less than 4% of the Emirati domestic supply market consists of renewable sources, yet the Emirati foreign and domestic investments display an intention to take part in the global energy transition [31]. This commitment remains undermined by expanding fossil-related investments.
On the one hand, the UAE has invested both financial capital and its international reputation in sustainable progress at home and abroad. Over the past years, it has made significant financial contributions to developing sustainable energy solutions. Such actions, indisputably, make the UAE a recognized partner in the developed world and an ally to developing countries. This way, it secures a seat at the changing global energy table.
On the other hand, despite these ongoing sustainability efforts in domestic and foreign policy, the UAE keeps pouring capital into its hydrocarbon assets. While such actions are expected of an oil-rich country in a fossil-dominated world, they significantly undermine the UAE’s forerunner role in fighting the climate crisis and raise questions about its true intentions.
Because of this reality, it is fair to conclude that the Emirati renewable energy interests lie not in ideology but in political and economic pragmatism. With its international role as a fossil superpower threatened by renewable transition, it has decided to become a part of the change to secure not only the flow of future capital but also a place at the international table. This way, the UAE secures its position as a traditional fossil fuel leader and a clean energy pioneer.
Thanks to its active participation in the clean transition and efforts to engage in global energy diversification, we may expect to encounter the UAE more and more in our lives, whether in the fossil-based scenario or, contrastingly, in the post-fossil world.
Article by Marína Kováčová
This is an edited version of the article 'Security Dressed in Green: What Motivates the UAE’s Push for Sustainable Energy', first published in Security Outlines.
Photo: UAE flag flies over a boat at Dubai Marina, Dubai, United Arab Emirates May 22, 2015. Credit: REUTERS/Ahmed Jadallah
[I] The deal was postponed due to the ongoing war in Gaza.
[II] Two major contracts were terminated by ADNOC. As a result, the project will be further delayed.
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