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Energy Transition Could Be Greatest Leap In Global Economic Prosperity Since 1st Industrial Revolution: UAE Min
But the transition must be fair and just, says UAE Minister of Industry and Advanced Technology
Photo Credit : Rohit Chintapali | BW Businessworld
UAE Minister Dr Sultan Ahmed Al Jaber on Tuesday said that the energy transition from oil and gas to green energy to be the greatest injection to world’s economic prosperity since the first industrial revolution. But he called for the transition to be inclusive and fair to all countries.
Speaking at the India Energy Week (IEW) 2023, the UAE Minister of Industry and Advanced Technology pointed out that the narrative around the energy transition has been skewed against the ‘Global South’.
“We must address this head on,” Al Jaber said.
He said that previous climate finance pledges made by the world have come with a price tag or not at all. While these pledges must be honored, the UAE minister opined that the world must expedite reform of international financial institutions and MDBs.
“We need to get more concessional finance to vulnerable communities around the world to lower risk and attract more private finance and turn billions into trillions,” he said.
The minister said that capital will be key to operationalise the losses and financing must be increased for communities which are most exposed to the effects of climate change.
Al Jaber called for the global stakeholders in energy transition to steer away from polarisation and divide. “We must unite our governments, our businesses, scientists, academics, civil society, women and you all must come on board.”
During his address, Al Jaber said UAE has stepped up investments in nuclear and hydrogen. He said that the country is expanding its global renewable energy footprint to at least 100 Gigawatt by 2030.
But he emphasised that plans around renewables alone are not enough.
An IEF report estimates that annual upstream oil and gas investments will need to touch USD 640 billion in 2030 to ensure adequate global supplies. “In total, USD 4.9 trillion will be needed from now until 2030 to meet market needs, even if the growth in oil and gas demand slows down,” said Joseph McMonigle, Secretary General, International Energy Forum, speaking at IEW 2023.
“The world still needs hydrocarbons and we need them to bridge from the current energy system to the new energy system,” UAE Minister Dr Sultan Ahmed Al Jaber said.
Al Jaber was of opinion that without a breakthrough in battery storage, the world needed to invest heavily into carbon capture and hydrogen value chain.
“But spending on these fundamental enablers of decarbonisation are less than 5 per cent of what is spent or renewables. And this must change,” he said.
On the first day of IEW 2023, OPEC Secretary General Haitham Al Ghais said that Oil needs more investment even as the energy narrative shifts towards cleaner fuels. He said that the Oil sector will need USD 12.1 trillion in investments until 2045.
Speaking to BW Businessworld on investments in oil, Shelly Abraham, Head (Renewable Energy) at BPCL said "USD 12 trillion is not a big number in the Oil sector, if you see it. Going by latest reports, this fiscal year the investment was around USD 1 trillion. But this is is likely to come down going forward as investments in renewables go up."
Weighing in on the topic of practical energy transition, Minister of Petroleum and Gas Hardeep Singh Puri said the process must be done in a manner that would provide a cushion to the most affected and vulnerable people, who get impacted from the volatility and global turbulence in the energy space.
Also Read: OPEC Secretary General Calls For More Investments Into Oil