Implications of Saudi net zero policy

Walid Khadduri

Published: Updated:

Saudi Arabia announced the adoption of a roadmap to cut its carbon emissions to net zero by the middle of the century. The announcement was made by Crown Prince Mohammed bin Salman in his opening speech at the Middle East Green Initiative summit, which was attended by world leaders and decisionmakers. The Crown Prince said the Kingdom targets net-zero emissions by 2060, to protect nature and man and confront climate change challenges.

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Later, Saudi Energy Minister Prince Abdulaziz bin Salman stated that “all options are wide open before us,” stressing Saudi Arabia’s determination to produce and export about “5 million tons of hydrogen by 2030.” He also said the Kingdom “seeks to become a trusted source for all forms of energy, and it has the capabilities to produce new forms of energy and integrate them in the Kingdom’s economy and exports.” The Kingdom, he said, would be able to manufacture electric vehicles.

The Minister of Energy explained that the “concept promoted by Saudi Arabia is the capture and storage of carbon to reuse it in other products, which is a key factor for the Kingdom’s achievement of net-zero emissions,” adding that “expansion and speed in this regard will mainly rely on the continuous scientific development in these nascent fields.” The world must “unite to find solutions, and it must also cut emissions,” said the Minister, who stressed that “Saudi Arabia has accepted the challenge and created the circular carbon economy concept.”

He added: “There are 700 million people with no clean energy for domestic cooking. We must set our priorities straight and fix things. We want to involve everybody without any exception in the development of comprehensive solutions that guarantee the availability of energy elements and sources.” Through the Middle East Green Initiative, Saudi Arabia will set “a green roadmap that protects the planet and nature, and will lead regional efforts to achieve global targets to combat climate change,” he said. This initiative will also “support efforts to protect current and future generations by increasingly relying on clean energy, neutralizing the impact of oil products, and protecting the environment.”

For his part, Saudi Aramco chief technology officer, Ahmad Al Khowaiter, said in a statement to the press that “the company is conducting test projects to produce aviation fuel and gasoline from a mix of carbon emissions and renewable energies.” He added: “Those are pilot projects, but if they prove successful and the market accepts it, we can scale it up. The carbon dioxide used in this case is captured from cement plant emissions or from the air.”

Al Khowaiter’s statements came on the eve of COP26, which is an important milestone on the energy transformation journey after the COP21 in Paris in 2015. During that conference, most states pledged to establish “general policies” to reach net zero emissions. The COP26 in Glasgow is set to review the details (pledges and executive actions) to which states committed during the last five years.

Nonetheless, it was evident from the start that the energy transformation journey would encounter some bumps on the road and that supply shortages during that journey were possible. The current rapid hikes in energy demand and prices are an example of these fears.

Thus, given the Kingdom’s weight and role in the region and OPEC, the Saudi initiative will likely serve as a pillar on which regional and OPEC states can rely to adopt clear policies regarding the role of clean (emission-free) petroleum in the new energy world.

The Middle East Green Initiative seeks to support zero net policies in the Middle East, although some states had already launched several projects in this field, such as Saudi Arabia and the UAE. Other Arab states, like Egypt, Morocco, Jordan, Iraq, and Oman have also initiated several renewable energy projects.

The Saudi announcement of its zero not policy, especially on the eve of COP26, is a huge leap toward clean oil, given the Kingdom’s status as the biggest oil-producing country at the regional, international, and OPEC levels. It is hoped that OPEC will soon follow the example of Riyadh and adopt a clear policy on clean oil and energy transformation that takes into account the technical and financial challenges that result from this transformation for each member state, as the continuous export of clean oil is paramount to the economies of oil-producing countries.

Global transformation to net zero emissions by mid-century has become a certainty, despite disagreements between some states on certain policies. This certainty stems from clear factors. First, global popular opinion is collectively pushing for change and for a better environment and climate. Second, scientific development could aid these changes, despite the great opportunities to further expand research and develop current scientific achievements. For instance, research is underway to improve carbon capture and storage. The more this research advances, the more carbon can be captured and reused. Research is also underway to improve storage capacity for electric vehicle batteries.
Oil started to dominate the energy scene at the start of the 20th century; and its second half saw increased gas consumption. Oil consumption will clearly face some competition on the energy scene from here on out, but retaining a specific proportion of the energy market for petroleum is also very possible, as new forms of fuel like hydrogen enter the market. After all, there are huge oil reserves that have already been explored and are ready for production; not to mention the trillions of dollars invested in the construction of petroleum facilities.

Saudi Arabia’s announcement last week confirms the Kingdom’s continued support for clean oil consumption in global markets for decades to come.

This article was originally published in, and translated from, the pan-Arab daily Asharq al-Awsat.

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