Net Zero Readiness Report

The UAE is ramping up its commitment to decarbonization ahead of hosting COP28 in November. In July 2023, the country pledged a 40% emissions cut from the 1990 baseline, up from the previous 31%, aiming for net-zero by 2050. Plans include producing 1.4 million tonnes of hydrogen by 2031, with one million tonnes being green hydrogen from renewables. The UAE also targets tripling renewable energy capacity by 2030. COP28 President designate Sultan al-Jaber urged the oil and gas industry to phase out methane emissions by 2030. Fadi Al Shihabi, Partner and Head of ESG Advisory Services at KPMG Lower Gulf, notes the UAE's ongoing efforts, with a focus on implementing strategies and significant investments, facilitated by oil revenues. The completion of a new nuclear plant in Abu Dhabi is also aiding in reducing gas demand.

Industry was responsible for 42 percent of the country’s emissions in 2022, including energy-intensive production of aluminum and steel. In June, Abu Dhabi, one of the seven emirates that make up the UAE, launched an industrial strategy involving investment of AED 10 billion (USD 2.72 billion) which includes environmentally focused aspects, including circular economy regulatory work, procurement that considers environmental issues and incentives for improving environmental sustainability. Abu Dhabi also makes use of natural carbon sequestration, reckoning that in 2018 the equivalent of around 5 percent of its carbon emissions were removed from the atmosphere by plantations including forests, mangrove wetlands and croplands.

Only a few thousand electric vehicles are currently on the UAE’s roads but this looks set to increase rapidly with the emirate of Dubai’s Green Mobility Strategy requiring 30 percent of public sector and 10 percent of all vehicle sales to be either electric or hybrid by 2030. Dubai also plans for all taxis to be hybrid or electric by 2027 and it has more than 620 electric vehicle charging stations with a target of more than 1,000 by 2025. Abu Dhabi is exploring hydrogen fuel for vehicles and its national energy company wants to install more than 70,000 electric charging points across the UAE by 2030. Etihad Rail, the country’s recently completed national rail system, aims to reduce the UAE’s annual transport emissions by 8.2MtCO2e through moving freight off the roads.

By adopting innovative strategies, establishing progressive policies and investing in clean technologies, the UAE is making promising progress, through sustainable urban planning, renewable energy adoption, environmental conservation, and responsible water management. It has undertaken ambitious sustainability initiatives, embracing a holistic approach to economic development that balances environmental conservation, social welfare and economic growth.