Commenting on his appointment as President of COP28, H.E. Dr Al Jaber noted: “This will be a critical year in a critical decade for climate action. The UAE is approaching COP28 with a strong sense of responsibility and the highest possible level of ambition”. The 2023 Barometer probes the opinions of professionals in the UAE on the impact of climate change on the region and the priorities of the UAE’s Presidency and beyond. The results indicate a strong belief that the region will be disproportionately affected by climate change by 2050, in turn, creating the need for setting ambitious energy transition and climate change targets. Whilst UAE energy professionals are optimistic about meeting these targets, the results also reveal concerns about the policies, regulation, and market mechanisms in place to get there.

Current climate conditions: whilst to date the impact of climate change in the UAE is no worse than anywhere else in the world, by 2050 it is expected to be disproportionately affected.

In terms of the effects of climate change today, 82% of respondents believe that the UAE is being impacted either similarly or less so than other parts of the world. However, when asked to consider the impacts of climate change by 2050, 53% of respondents believe that the UAE will be disproportionately adversely affected by climate change than elsewhere in the world. Despite this, there is optimism that the UAE will be able to adapt with some interviewees pointing to the fact that the people in the region have a long history of coping with extreme climatic conditions, in particular high temperatures.

Future climatic conditions: the impacts of climate change are creating pressure for change with rising temperatures and shorter winters that create harsher working conditions the two biggest concerns for people’s lifestyles in the UAE.

With the UAE expected to be increasingly affected by climate change, the survey reveals how this is most likely to manifest itself and how people’s lives in the region are most likely to be impacted. The majority (58%) of the survey’s respondents believe that a combination of rising temperatures and shorter winters are the greatest threat from climate change to the way of life in the UAE. These, in turn, are expected to lead to harsher working conditions in an increasingly hotter climate (56%), water scarcity (41%), and climate change-related air pollution, mainly due to dust and sand suspended in the air, cars, and fossil fuel power stations (38%).

It is perhaps somewhat surprising that, in a country where most of the urban development is coastal, either on existing or reclaimed land, the threat of rising sea levels only ranked fifth with desertification sixth. Nonetheless, it is clear that “water” as a general theme within climate change risk is a prevalent concern.

Whilst many interviewees agreed with the survey results, there were some opposing views as to whether or not some threats were directly attributable to climate change. For example, opinion is split on whether water scarcity in the UAE is due to climate change with one interviewee stating:

“With or without climate change, we would still be draining the aquifers at an unsustainable rate. And it would still be a huge problem.”

Whatever the cause, a continuing decline in the water table will only serve to drive demand for desalination for cleaner and potable water. In a further twist to the impact of climate change, another interviewee raised the issue of increased salinity of seawater that, in turn, raises the work rate and energy requirements of desalination processes.

What are the perceived greatest threats from climate change to the way of life in the UAE?

Under its COP28 Presidency, to get the global energy transition on track for 2050, the UAE must proactively push on multiple fronts to strengthen emissions reduction targets and accelerate the actions needed to deliver them.

The respondents acknowledge that tackling climate change is a global challenge requiring a global response. As one interviewee stated, “The UAE is a wealthy country, and it may be able to meet its emissions targets. But this is not enough. They need to be met everywhere”. The fact that over a quarter (27%) of respondents indicate “strengthening countries’ existing emissions reduction targets across the board” to be the top priority for the UAE’s COP28 Presidency indicates not only a strong belief that action must be universal, but that current commitments do not go far enough.

With stronger targets in place, there are expectations that the UAE should then use its Presidency to work on multiple fronts to deliver the action needed to meet those targets. Given relatively equal weighting, the priorities for that agenda should be to “broker specific agreements to speed up deployment of renewables globally” (21%), “reform and reinforce climate financing mechanisms” (18%), “broker specific agreements to reduce flaring and methane emissions from oil and gas lifecycles” (17%) and “broker specific agreements to phase out the use of coal globally” (15%).

It is understood that universal action is required to tackle climate change and that the UAE is committed to playing its part alongside others. Through collaboration and leveraging synergies with regional partners, significant mutual benefits can be delivered.

On addressing the question of how greater collaboration across the region to combat climate change would benefit both the UAE and the other Gulf Cooperation Council (GCC) countries, a high percentage of respondents (44%) ranked "accelerating clean energy through joint R&D and knowledge exchange" as the most important area for collaboration. This was followed by "realising economies of scale from shared or interconnected assets" (39%) and "common regulatory and licencing frameworks" (31%). [For some questions, the respondents could provide and rank multiple answers to a single question. In these instances, the percentage scores can sum to more than 100%. Please see the Methodology at the end of the report for more information.]

Beyond COP28, the UAE must continue to demonstrate leadership of and influence the global energy transition. It has an opportunity to create the template for how other oil and gas producing nations fulfil their parts.

The survey responses indicate several ways in which the UAE should act in the medium to long term, particularly in demonstrating good practice and climate leadership to other oil and gas producing nations. The areas for it to prioritise and the weightings given were evenly split between “investing heavily in technologies to decarbonise fossil fuel production and use” (28%), becoming a “vocal advocate for ambitious climate action by other oil and gas producers” (25%), “shifting the energy industry's focus firmly from oil and gas to renewables” (24%), and “continuing its role as an oil and gas producer but increasingly channelling their profits into clean energy” (20%). An interesting view arising from the interviews was the need to facilitate international agreement over access to the key rare elements and minerals so critical to several technologies needed for the energy transition. Whilst expectations were low that this could be brokered during COP28, laying the groundwork now through debate could create the conditions for future action and would be another positive outcome for the UAE’s Presidency.

The UAE has engaged in efforts to recognise and combat the effects of climate change, first ratifying the Vienna Convention in 1989 and joining the United Nations Framework Convention on Climate Change (UNFCC) in 1995. Although UAE emissions have continued to rise significantly since that period, the government has now introduced the net zero by 2050 initiative, the delivery of which is being coordinated by the Ministry of Climate Change and Environment (MOCCAE) through collaboration at a national level and engaging stakeholders in key sectors, such as energy, industry, infrastructure, transport, waste, agriculture, and the environment.

The UAE has announced several initiatives to achieve net zero emissions by 2050. These include its Hydrogen Strategy, CCUS projects and the National Geospatial Platform for Future Energy. However, in targeting only 50% of the energy mix to come from low carbon energy sources by 2050, an unprecedented level of CCUS infrastructure will be needed to address the GHG emissions from the remaining sources (natural gas at 38% and clean coal at 12% expected by 2050). This is all the more important as the UAE’s carbon emissions have risen by an average of 2.3% per annum over the past decade, compared to the global 0.6% per annum increase over the same period (EI Statistical Review of World Energy, 2023).

The Barometer sought to test the level of confidence in the UAE’s ability to achieve its domestic greenhouse gas emissions reduction and energy transition targets.

At the time that the Energy Barometer survey was opened in May, respondents were asked to comment on the UAE’s 2022 Paris Agreement Nationally Determined Contribution (NDC) action plan of a 31% reduction in GHG emissions below business-as-usual levels by 2030. Whilst the survey was still underway, in July, this was tightened to 40%.

The UAE has embraced the imperative to combat climate change by setting itself challenging targets. Confidence is high that these commitments will be achieved.

The survey explored people’s confidence in the UAE’s ability to deliver on meeting its international commitments to tackle climate change. In total, 61% of respondents expect that the UAE will at least meet or exceed its greenhouse gas emissions reduction targets by 2030.

The optimism expressed in the survey was confirmed with several interviewees highlighting the ambition and determination of the region’s policymakers with one person stating, “The leadership of the UAE walk the talk”. Another interviewee highlighted that ADNOC, the UAE’s state-owned oil company, recently (July 2023) brought forward its own emissions targets, committing to reach net zero emissions from its operations by 2045 and cut methane emissions to zero by 2030.

“When you have a country that can afford to make the transition, and particularly now with [fossil fuel] prices at these levels to be diverted to clean energy, that makes it a lot easier than a country that has to rely on external financing. Green Finance is not in short supply. It's just not being directed to the right places.“ (anonymous interviewee)

At present, the focus of policy is heavily weighted toward investing in zero and low-carbon technologies with insufficient attention given to demand-side management, energy efficiency, and optimising the operation of the energy system.

According to the EI Statistical Review of World Energy 2023, less than 5% of the UAE’s energy consumption comes from low-carbon sources (~3.5 % from nuclear and ~1% from solar). Despite this low contribution today, 65% of respondents still believe that, given the current pace of development, the goal to reach 50% of clean energy (nuclear and renewables) in the energy mix, as expressed in the country’s Energy Strategy 2050, will be met or exceeded by 2050. Whilst in the opinion of one respondent, “Whenever the UAE Government commits to something, they will make it happen and they will force through somehow”, concerns were expressed that policy makers are not giving sufficient attention to solutions such as demand-side management and efficient operations that offer immediate low cost, high value material benefits.

“I believe the UAE will meet the [energy diversification] target, but I think it could be done much more economically if you push more on the demand side management and fundamentally reduce the need for more power generation by balancing the loads as opposed to just building more CapEx.” (anonymous interviewee)

Without well designed and executed regulation, the risk of not meeting the targets, or meeting them in a sub-optimal way, remains high.

The UAE became the first Middle East and North Africa (MENA) country to announce a net zero 2050 strategic initiative in 2021. The Barometer’s respondents rank the three biggest barriers to the UAE achieving its net zero 2050 target as: "high dependency on oil and gas resources and revenues" (66%), "lack of a clearly laid out action plan and associated regulatory frameworks" (41%) and the "omission of Scope 3 emissions from the target's scope", i.e., indirect emissions that occur in the activities of an organisation (38%).

In addition, with specific reference to renewables, 20% of respondents highlight inflexible and complex regulation, planning, and licencing procedures as the biggest barrier to the deployment of renewable energy in the UAE. Further discussion highlighted that whilst gaining consent for large centralised infrastructure is relatively straightforward, particularly for energy-related projects, securing planning consent for smaller, decentralised projects, particularly in the building and residential sectors is far harder. This is particularly considered to be hampering the deployment of residential solar PV.

When planning and designing its future policy and regulatory priorities, the survey results indicate four focus areas that were given relatively equal weighting by respondents with combined fiscal measures (carbon prices and taxes, subsidies and tax breaks) at 49% and human factors (R&D, building skills and capabilities to develop, deploy, and operate technologies) at 47%.

The UAE needs to develop, acquire, or attract skills and capabilities across a broad spectrum of activities critical to moving the energy transition forward.

Implementing programmes to build capability in key areas for delivering a successful energy transition is also highlighted as an area requiring more focus from policy makers. “Expertise in energy efficiency” is highlighted by 31% of the respondents as a skill that will need to be most improved within the UAE's energy workforce as the economy transitions to net zero.

Other areas where expertise needs to be developed are "environmental, social, and corporate governance (ESG)" (28%); and "policy, leadership and strategy" (27%). These need to be underpinned by cross-cutting capabilities such as "digitalisation and data analytics" (23%); and "broad energy system knowledge" (21%).

Which of the following skills and capabilities will need to be improved within the UAE's energy workforce as the economy transitions to net zero?

When asked where the greatest effort should be placed to further develop a skilled energy workforce in the UAE, most of the respondents (39%) indicate "fostering collaboration between industry and educational institutions" to be a key enabler, followed by "training, reskilling, and upskilling existing workers" (31%) and "growing early-stage technology / R&D capabilities" (28%). The Sustainable School Initiative in the UAE is cited as a good example of educating and equipping future generations with the low-carbon skills and competencies that they will need.

When asked what actions should be taken to attract and retain more women in the UAE energy industry, respondents suggest “introducing/extending flexible working opportunities” (39%), followed by “improving board-level diversity” (30%) and “introducing/extending family-friendly policies” (27%).

For the UAE to achieve net zero by 2050, the challenges reach far beyond transitioning its energy system. For a nation heavily dependent on oil and gas to meet its own energy needs and drive its economy through export revenues, its entire economy needs to transition too. This is starkly revealed in our survey respondents ranking the three greatest threats faced by the UAE as a consequence of the global energy transition as "economic dependence on fossil fuel markets" (78%) followed by "higher than global average domestic energy consumption intensity" (58%) and "low carbon skills and labour shortages" (37%). However, they also point to opportunities, particularly in becoming a leading supplier of cleaner fuels, with the hydrogen economy emerging as a very real prospect.

These results are validated by the interviewees, some of whom indicate that the significant challenge of high domestic energy consumption intensity is not unique to the UAE but is present across the entire Gulf region. Whilst a low-carbon skills shortage is considered a significant threat, some interviewees pointed to the UAE’s labour market being particularly attractive to highly skilled expat workers as a potential mitigating factor.

Although there is consensus that the current and planned levels of investments in renewable energy and technologies like Direct Air Capture and CCUS needed to meet the targets will be delivered, a couple of interviewees did stress that success is not guaranteed given how challenging and costly it will be.

Given the global transition to net zero emissions, what are the major challenges that the UAE must consider for its energy and economic security?

Energy efficiency remains an untapped resource for helping to deliver the UAE’s net zero ambitions and needs to be moved to the heart of its transition plans. This was a recurring message from respondents regardless of the area of energy they work in. It is a carbon abatement option with potentially huge potential to reduce emissions, often at negative (or no-regret) cost.

As important as the comprehensive development of clean energy supply technologies is, the solutions cited most by our respondents centre around prioritising improvements in and incentives for energy efficiency. Indeed, 44% of respondents believe that "energy efficiency and demand management" is an opportunity area that needs the most focus and investment in the UAE, followed by "solar" (41%), "energy storage and networks" (38%) and "CCUS" (31%).

Which technological sectors do you believe need the most investment in the UAE?

In identifying specific opportunities to focus on for greater energy efficiency, respondents concentrated on the build environment rather than transport or industry. Targeted opportunities are "raising minimum sustainability standards for new buildings" (36%), "increasing investment in critical technologies such as efficient ACs, heat pumps, and smart metering" (36%), and "tightening regulations & standards for building cooling, smart equipment etc." (35%).

The UAE aims to improve the energy efficiency of the three most energy-intensive sectors in the country (transport, industry and buildings) by 40% compared to business as usual by 2050. What actions should be prioritised to improve energy efficiency across these sectors?

In addition to the survey responses, interviewees highlight other measures successfully deployed in other countries, e.g., mandatory display of the energy performance certificates that incentivise building owners and consumers to invest more in energy efficiency solutions, improving public awareness through education and information campaigns, and incentivising behavioural changes to encourage people to use less energy, as easy-win solutions to be included in policy planning.

Air conditioning, a major consumer of energy in the UAE currently responsible for approximately 70% of buildings’ peak electrical load and which is set to rise as temperatures increase, is a clear area to focus on with 60% of respondents prioritising the need to "improve building efficiency (e.g., building envelope)", 51% stressing the need to "introduce stringent minimum energy performance standards (MEPS) on AC equipment", and 36% calling for the "introduction of regulations on maximum low AC temperature in public buildings".

Efficiency is also prevalent in the solutions suggested for improving water security in the UAE. Water consumption per capita in the UAE is roughly 50% higher than the world average. In addition, the energy required to desalinate seawater represents approximately 30% of the country’s total power consumption. Respondents prioritise "increasing investment in water management and recycling infrastructure" (52%), "improving energy and water efficiency standards" (51%) and "increasing investment in more efficient desalination technologies" (44%).

Another aspect of energy efficiency is the reuse, recycle, and repurpose elements of the circular economy. When asked what the most important benefits arising from current and planned waste-to-energy projects are in the UAE, respondents rank "efficient waste disposal" (60%), "reduction of greenhouse gases" (46%) and "generation of energy" (44%) as the key areas to consider reducing waste.

In achieving 2050 net zero, all nations face the energy trilemma of doing so in a manner that delivers on security, affordability, and sustainability. For an economy such as the UAE which is heavily dependent on oil and gas, the challenge is great, but opportunities exist.

The overwhelming challenge that the UAE faces is its dependence on oil and gas, both to meet its energy demand but also to underpin its economy through exports. In 2022, oil and gas contributed almost half of government revenues helping to deliver an estimated 9.4% budget surplus of GDP. With its economy inextricably linked to energy, 59% of respondents believe that low-carbon fuels need to be added to its export mix and 28% indicate that it should replace its reliance on oil and gas with low carbon hydrogen and other clean fuels.

The UAE is among around 40 countries across the world that include hydrogen – a versatile energy carrier that can be produced from various energy sources - in their energy transition strategies. If it is produced in a sustainable way (‘low-carbon hydrogen’), it may be used as a substitute for fossil fuels and play an important role in the new energy system. The UAE has abundant availability of both solar (for green hydrogen) and natural gas (for blue hydrogen when combined with CCUS). When asked to consider the UAE’s aim to capture 25% of the global hydrogen fuel market by 2030, most respondents anticipate that it will be mainly "blue hydrogen" (34%) or a "diverse mix including non-low carbon hydrogen" (23%).

In the short to medium term, 41% of respondents indicate that oil and gas profits should be used to finance renewable energy and hydrogen technologies in parallel with continued focus on both reducing emissions associated with oil and gas production (30%) and on deploying carbon capture, usage, and storage solutions (13%).

Around two-thirds of respondents (64%) believe that "greater incentives for energy efficiency and reduction" should be prioritised to ensure less carbon-intensive production and use of oil and gas. It is followed by "greater investment in carbon-capture technologies" (52%) and "greater commitments or penalties to reduce methane emissions and flaring" (43%).

The UAE Government stresses the need for a realistic approach to decarbonisation in which fossil fuels continue to play a role in energy security whilst using the least carbon-intensive oil and gas solutions. What should be prioritised to ensure less carbon-intensive production and use of oil and gas?