Complex Made Simple

Can UAE and Saudi’s oil and net-zero emissions plans coexist?

Saudi and the UAE have a knack for making lofty promises and delivering on all of them. Whether building a global metropolitan city from scratch or reaching net-zero aims, these two Gulf countries do not make claims and fall short of achieving them

The UAE will invest more than $160 billion to become net-zero carbon emissions The UAE initiative is in line with the Paris Agreement Oil and gas exports remain a strong part of the UAE economy

Saudi and the UAE have a knack for making lofty promises and delivering on all of them. Whether building a global metropolitan city from scratch or reaching net-zero aims, these two Gulf countries do not make claims and fall short of achieving them.

Saudi’s net-zero

On October 23, 2021, Saudi Arabia, the world’s biggest oil exporter, pledged to cut its carbon emissions to net-zero by 2060. Crown Prince Mohammed bin Salman said the Gulf state would invest more than $180 billion to reach the goal. But he said the kingdom would continue to produce oil for decades to come.

Documents leaked to the BBC revealed Saudi officials asked the UN to play down the need to rapidly move away from fossil fuels, ahead of the COP26 meeting, which starts in Glasgow on October 31.

At the launch of a climate conference in Riyadh, Saudi Crown Prince Mohammed Bin Salman (MBS), said it would reach the target without affecting the “stability of global energy markets.”

He said the country also would cut its emissions of methane by 30% by 2030. The plans would rely on “the availability of the required technologies to manage and reduce emissions,” MBS said.

Energy Minister Abdulaziz bin Salman said the country would use carbon capture – technology that extracts CO2 from the air, to help it meet the goal. Earlier this year, Saudi Arabia said it would reduce carbon emissions by shifting to renewable energy and planting billions of trees.

On Sunday, October 24, Bahrain’s Cabinet said the Gulf country aims to also reach net-zero carbon emissions in 2060, to help tackle climate change and protect the environment, the state news agency (BNA) reported.

UAE’s net-zero

The UAE will invest more than $160 bn to become the first Gulf state to achieve net-zero carbon emissions by 2050, as part of a significant but detail-light climate initiative revealed Thursday at the Expo 2020 site. 

“We are committed to seizing the opportunity to cement our leadership on climate change within our region… as we pivot our economy and nation to net zero,” said Sheikh Mohammed bin Rashid Al Maktoum, vice president and prime minister of the UAE and Ruler of Dubai.

The 2050 target aligns the UAE with most major global climate commitment pledges and comes ahead of the United Nations COP26 climate talks in November.

The UAE initiative is in line with the Paris Agreement, which calls on countries to prepare long-term strategies to reduce greenhouse gas emissions and limit the rise in global temperature by 1.5 °C compared to pre-industrial levels. 

The government is lobbying to host the COP28 global climate summit in Abu Dhabi in November 2023. 

The regional first move will also likely add significant pressure on other major fossil fuels producers, such as Saudi Arabia, to raise domestic ambition to be part of the solution.

Despite efforts to diversify and build its green credentials, oil and gas exports remain a strong part of the UAE economy, making up 30% of the national GDP.

The country produced an average of 4 million barrels per day of petroleum and other liquids in 2019, according to the US Energy Information Administration, ranking it seventh in the world.

Abu Dhabi National Oil Company, known as ADNOC, still plans to invest heavily to increase oil production capacity to 5 million barrels a day in the coming years following approval to invest $122 bn in developing new oil and gas deposits.  

The country has invested over $40 bn in clean energy sectors in recent years, as well as contributions to renewable energy projects in 70 other countries, in anticipation of the energy transition. 

Its first nuclear power plant, Barakah, has been connected to the national grid and the UAE aims to produce 14 GW of clean energy by 2030, up from about 100 MW in 2015, Reuters reported.

The net-zero commitment could put pressure on neighboring Saudi Arabia, the world’s largest oil producer, to move away from fossil fuels.