The UAE and Saudi Arabia continue to lead climate-related efforts in the Gulf region, S&P Global Ratings said, with their governments planning to continue investing in decarbonizing the power sector.
About 90% of the region's renewable energy capacity was in the two countries as of year-end 2021, with the UAE alone making up 77%, the agency said in a report titled “Gulf Nations Invest To Accelerate Deployment Of Renewable Energy."
The power sector, as one of the largest sources of emissions, looms large in most national plans for decarbonization, said S&P Global Ratings credit analyst, Terry Ellis.
Decarbonizing the power sector by heavily investing in renewables is part of the national objective for achieving net zero targets in both the UAE and Saudi Arabia," Timucin Engin, another S&P Global Ratings credit analyst, noted in the report.
Emirates Water and Electricity Company, known as EWEC, said in late 2022 that clean energy accounts for more than 60% of the total power it generates, with solar and nuclear energy stations producing 5.5 gigawatts of the total 8.6 generated by the utility.
Meanwhile, Saudi Arabia has plans to generate 50% of its electricity from clean sources by the end of this decade and is targeting 58.7 gigawatts coming from renewable sources.
$163 billion. The UAE plans to invest this amount into clean and renewable energy sources over the next three decades, while Saudi Arabia plans to invest $180 billion to reach its net-zero goal by 2060. Net-zero targets UAE and Saudi have also committed to updated targets as part of renewed efforts to reach net zero, the agency said.
The UAE plans to be net-zero by 2050, while Saudi Arabia said it aims to reach zero-net emissions by 2060 through a circular carbon economy approach.
The Gulf nations have all announced new targets or renewed their commitment to the Paris Agreement in the past two years, despite their dependence on the oil and gas industry.
S&P believes plans to establish a renewables sector could help them in their efforts to achieve their climate goals.
