The global energy industry is undergoing radical transformations in favor of green energy, and countries in the Middle East have become interested in becoming producers and exporters of renewable energy and forming strategic partnerships for that purpose.

 For example, the UAE has signed an agreement with the US to invest USD100 billion in clean energy projects in both countries and around the world by 2035. The  have also been extensive discussion between Dr. Sultan bin Ahmed Al-Jaber, Minister of Industry and Advanced Technology, and UAE Special Envoy for Climate Change, and Robert Habeck, German Vice-Chancellor, and Minister of Economic Affairs and Climate Protection exploring ways of cooperating in clean energy (October 21, Hamburg).

In the same vein, Saudi Minister of Energy Prince Abdulaziz bin Salman led discussions with a number of European officials to discuss cooperation in the field of green energy with France’s Energy Transformation Minister Agnes Panier Runacher, and Teresa Ribera Rodrigues, Vice-President of the Spanish Government, as well as Greek Minister of Environment and Energy Costas Skrikas.  A Saudi delegation, headed by Majid Al Kasabi, Minister of Trade and Chairman of the Board of Directors of the General Authority for Foreign Trade, paid a visit to Finland to discuss cooperation in several areas including the green energy sector.

Cause for change

The main reasons behind the increasing interest in developing cooperation in green energy over the past period are:

Alignment with international green energy trends: Many countries have  adopted urgent plans  to achieve a balanced energy mix with increased reliance on clean energy by 2030 and 2050. For example, Saudi Arabia’s ambition is for renewable energy to make up 50% of electricity production by 2030. The UAE targets clean and renewable energy as 50% of the energy mix in 2050 The growing momentum in sustainable alternative energy has been prompted by  competition to gain an influential role in the context of a new global energy map, as well as the implications of the Russian/Ukrainian war on traditional energy sources.

These developments are in line with global trends to replace fossil energy with clean and renewable energy by 2050. According to an optimistic IEA scenario, the share of fossil energy should decline from about 80% to 20% (see Figure 1). Thus, partnerships in the production and export of green energy will be one of the most important features of the future energy sector, especially as there will be support from developed countries to adopt that trend in developing and poor countries.

(Source: Net Zero by 2050, International Energy Agency 2021)

Developing strategic partnerships for green energy: Recent cooperation agreements and partnerships illustrate the attempts to improve current approaches to the exploration and production of fossil energy. Partnerships have been formed between energy companies and states institutions, through which companies were engaged to embark on green energy projects. The most prominent recent example is the signing of a memorandum of understanding on renewable energy generation in sub-Saharan Africa by the Commissioner for International Partnerships of the European Union, Jota Urbilinen, and the Director of the United States Agency for International Development, Samantha Power (14 October 2022).

Saudi and UAE action follow suit, as evidenced in the recent UAE-US partnership agreement, which aims to inject USD100 billion in investment into the two countries, as well as others to cooperate in green energy. Furthermore, Saudi Arabia launched the Green Middle East Initiative, which focuses on Saudi cooperation with countries in the region to transform green energy, will be activated in the coming period. Mohammed bin Salman, Crown Prince Prime Minister, Chairman of the Supreme Committee of Green Saudi Arabia confirmed that he will launch the second round of The Middle East Green Initiative Summit on November 7 at the Cop27 Conference.

The Western model of strategic cross-border partnerships in green energy enhances the economic role of Western corporations in the countries where green energy projects will take place, and will also allow these companies access to important the mineral resources, such as cobalt in the Democratic Republic of the Congo and Mozambique,  lithium in Zimbabwe, and Bauxite in Guinea. These mineral resources will provide significant revenues to exporting states, as illustrated in Table 1, which shows the projected increase in mineral export revenues from sub-Saharan Africa.

Table 1 Expected revenues of major mineral exports  in sub-Saharan Africa’s green energy, 2020-2030

(Source: African Energy Outlook 2022, International Energy Agency)

Global energy market restructuring: The move towards green energy will reduce the control of traditional energy producers over the energy market, as there will be a variety of centers for producing renewable energy around the world. The restructuring of the global energy market may be accompanied by a change in the map of political alliances and relations. This has been illustrated by intense European outreach to the countries of north Africa, due to their geographical proximity and the potential they have for producing green energy.  Gulf states (especially Saudi Arabia and the United Arab Emirates) have also received increased interest in this respect.  These countries have also developed expertise in the green energy industry, and have ambitious national agendas to become  hubs for the green energy industry . Several countries in central and west Africa will also likely become important players in this new energy market, as they possess mineral resources important to this industry (see Figure 2).

(Source: www.ihsmarkit.com)

Taking advantage of the COP27 conference: The conclusion of many agreements and partnerships across states and corporations before and during the conference  highlights a serious momentum in turning to green energy. The conference provides an opportunity to  establish sustainable cooperation between states, companies, and international institutions to promote green energy, in view of  growing criticism over the lack of development in reducing carbon emissions from fossil energy over the past decade (see Table 2).

Table 2 Global CO2 Emissions from Fossil Fuels (million tons)

(Source: www.co2.earth)

Economic advantages of green energy:  The momentum of turning to green energy is also driven by economic motivation, as it is projected to  contribute to the creation of 38 million new jobs globally by 2030, bringing clean energy workers and activities to 139 million jobs. Alternatively, unemployment resulting from reduced dependence on fossil energy will be offset by 106 million jobs (according to the International Renewable Energy Agency’s estimate in March 2022). According to some estimates, new occupations may be significantly concentrated in the areas of energy efficiency and green energy generation (see Table 3).

Table 3 Job Creation in the Green Energy Sector by 2030

(Source: www.weforum.org)

The number of new jobs created in the green energy industry is a positive contribution that can offset the increasing unemployment rates resulting from a growing population. The disappearance of many jobs due to technological developments and changing consumer preferences, means that developing the green energy sector bears positive economic implications garnering the required attention by states who wish to play an active role in the future global energy market in the light of the energy industry’s challenges.

In conclusion, there is worldwide interest in fostering the move towards green energy and quickly shift away from fossil fuels. Green energy exporters could play a major role in enhancing global energy security, and  bilateral and multilateral cooperation in this area is likely to grow in the near future.