Can Major Oil Producers Like The UAE Really Hit Net Zero Carbon Emissions?

The suggestion this week by a well-placed UAE official that his country might soon set a “net zero” target for carbons emissions is a further sign of the rising pressure on governments around the world to do more to limit the potentially devastating impact of climate change.

Such targets are becoming more common. In 2015, only three governments had made a pledge, but today more than 40 have done so. The UAE, however, would be the first major oil producer to do so.

However, such targets are not always as ambitious as they might first seem. If the UAE does go ahead with setting a target, it will not take account of all the oil and gas extracted from its territory and consumed around the world. Last year, the UAE produced some 3.7 million b/d of oil and 55.4 billion cubic metres of natural gas, according to data compiled by oil major BP.

Like other big hydrocarbons producers in the Middle East, the UAE finds itself in a difficult position. Despite repeated waves of economic diversification programmes, countries remain heavily dependent on oil and gas revenues. And as long as global demand for oil and gas remains buoyant, they are loathe to deny themselves that income, particularly when there are no ready alternatives to fund the generous social contracts with their citizens – something which has deep political as well as economic implications.

The UAE and its neighbours are themselves also heavy energy users, with their wealth and forbidding climate encouraging people to use large cars and rely on energy-hungry air conditioning units and water desalination plants. The World Bank says the four worst countries in the world in terms of CO2 emissions per capita are Qatar, Kuwait, the UAE and Bahrain.

The Climate Action Tracker rates the UAE’s efforts to date as “highly insufficient”, which is at least better than “critically insufficient” Saudi Arabia.

There have been some notable advances, though, with large solar power plants up and running – including a solar park in Dubai which will have a capacity of 5GW when it is completed in 2030. Abu Dhabi is also the host city for the International Renewable Energy Agency. But there have also been setbacks, such as the failure of a scheme to plant 1 million new trees in Dubai – seemingly the victim of officials preferring to push ahead with real estate developments instead.

In that context, setting a net-zero target would at least be another important statement of intent. “We are considering a net-zero target like any other part of the world,” Qais Al Suwaidi, head of the Ministry of Climate Change and Environment’s climate change department, said in an interview with Bloomberg published earlier this week.

Discussions are set to be taking place “at all levels of government” and an announcement could happen ahead of the Cop26 climate change talks, scheduled for Glasgow, Scotland in November. A successful meeting is widely seen as crucial if global temperature rises are to be limited to the target of 1.5-degrees Celsius above pre-industrial levels envisaged in the 2015 Paris Agreement.

Talk versus action

According to the International Energy Agency (IEA), 44 countries have made net zero pledges or proposals to date, accounting for 73% of global CO2 emissions. However, only ten countries have made reaching the target a legal obligation – for others it is little more than an official aspiration. “There is a lot of talk: ‘We can achieve net zero, we’re going to do this, we’re going to do that’,” Al Suwaidi told Bloomberg. “But then in practice we see contrary action. We like to do things differently.”

The UAE has also said it wants to host the Cop28 talks in 2023. Its stated ambitions set it apart from most of its neighbours, even if its actions are still closely aligned.

Qatar shows few signs of wanting to adopt a net zero target and Saudi Arabia’s energy minister Prince Abdelaziz Bin Salman was publicly scathing of the IEA’s Net Zero by 2050 report issued earlier this year, dismissing the document by saying “I believe it is a sequel of [the] La La Land movie … Why should I take it seriously?”

That IEA document spelt out the real challenge for oil producers. According to the IEA’s estimates, if the world is to reach net-zero carbon emissions by 2050, there should be no further upstream oil and gas developments anywhere in the world and global oil consumption will need to fall from more than 100 million b/d in 2019 to just 24 million b/d in 2050, while natural gas consumption needs to drop by 55% to 1.75 trillion cubic metres.

Whether the UAE or other oil producers do commit to their own net zero targets, the critical element for their economies – and for climate change – is whether other countries around the world which consume all the oil and gas they produce do the same.

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