US, UAE sign strategic partnership deal to boost $100 billion in clean energy investments

US, UAE sign strategic partnership deal to boost $100 billion in clean energy investments

Solar panels are installed at the University of California, Merced solar farm in Merced, California, on August 17, 2022.

Nathan Frandino | Reuters

ABU DHABI, United Arab Emirates – The United States and the United Arab Emirates announced on Tuesday the signing of a strategic partnership that will see $100 billion mobilized to develop 100 gigawatts of clean energy by 2035.

The agreement, signed during the Adipec energy conference in Abu Dhabi, is entitled “Partnership for Accelerating Clean Energy” (PACE) and includes four main pillars: the development of clean energy innovation and supply chains supply, management of carbon and methane emissions, nuclear energy. , and industrial and transport decarbonisation.

“The cooperation comes within the framework of the close friendship between the UAE and the United States of America” ​​and “affirms the commitment of both parties to work to strengthen energy security and advance progress in action climate,” according to a statement issued by the UAE government. by the state news agency WAM.

The White House described the new partnership as a major achievement for President Joe Biden’s climate agenda.

“Today President Biden again demonstrated his deep commitment to securing a global clean energy future and long-term energy security as the United States and the United Arab Emirates announced a robust partnership to ensure the rapid transition and move toward clean energy and away from fossil fuels,” the White House statement said.

The two countries created an “expert group” to “identify priority projects, remove potential obstacles, and measure the progress of PACE to reach its goal of catalyzing $100 billion in financing, investments and other support and implementing it in the worldwide 100 gigawatts of clean energy,” he said.

The UAE is a major oil exporter, but has invested heavily in the development of non-fossil energy sources, including the construction of the world’s largest single-site solar power plant and the first nuclear power plant in the Arab world . It is expected to host the COP 28 climate summit in 2023.

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The ambitious plan by both countries comes at a time of growing demand for oil and shrinking global oil supply, as years of underinvestment in fossil fuels and months of Russia’s war in Europe have led to a supply glut. restricted and high prices for consumers.

At the same conference where PACE was signed in action, oil and gas company CEOs have warned of the dangers of limiting fossil fuel production to prevent climate change.

While recent years have seen strong calls for more investment in renewable energy and accelerating the transition away from hydrocarbons – a continuing pillar of the Biden administration’s goals – more leaders are now insisting on the need for a recovery the production of oil and gas in front of what could be very much. difficult winter for Europe, and other parts of the world that face the shortage of those commodities. Oil and gas prices have seen multi-year, and in some cases, record highs in the last year amid supply issues and geopolitical conflict.

“Maximum energy, minimum emissions”

Sultan Al Jaber, CEO of Abu Dhabi National Oil Company (ADNOC), said in a speech at the Adipec conference on Monday that “energy is everyone’s first priority” today as “a perfect storm” hits the global energy landscape. He said that years of underinvestment in oil and gas production has worsened the situation.

“If we have zero investment in hydrocarbons, due to natural decay, we will lose 5 million barrels per day of oil every year from current supplies. This would make the shocks we experienced this year feel like a minor tremor,” said Al Jaber. stressing the importance of energy security.

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He emphasized the need for traditional energy investment and the reduction of carbon emissions, arguing that they are not mutually exclusive and saying that “the world needs maximum energy, minimum emissions.”

“It’s not oil and gas, or solar, not wind or nuclear, or hydrogen. It’s oil and gas and solar, and wind and nuclear, and hydrogen,” Al Jaber said. “It’s all of the above, plus the clean energies that need to be discovered, commercialized and implemented.”

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However, many policy makers and institutions strongly criticize the use of fossil fuels, warning that the much bigger crisis is that of climate change. In June, United Nations Secretary-General Antonio Guterres called for an end to fossil fuel funding, and called any new funding for exploration “delusional.”

However, global economic forces do not seem favorable to this goal. According to a recent report by UNCTAD, the United Nations Conference on Trade and Development, cross-border investment in climate change mitigation and adaptation is expected to fall this year amid a further decline wide range of investment projects.

And the Organization of the Petroleum Exporting Countries, or OPEC, on Monday raised its medium and long-term forecasts for crude demand, and said that $12.1 trillion of investments were needed to meet them.

OPEC’s outlook still differs from that of some other bodies, such as the International Energy Agency, which sees oil demand peaking in the middle of the next decade as nations continue to push for the transition from fossil fuels.

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