Till this month, the oil-rich United Arab Emirates had modest ambitions when it got here to renewable vitality: to put in roughly as many photo voltaic panels every year because the UK.
However then Masdar, the nation’s state-owned renewable vitality firm, determined to make a splash at an enormous commerce truthful in Abu Dhabi.
In entrance of the UAE president, it introduced it might construct a $6bn 5 gigawatt photo voltaic plant backed with greater than 19GWh of battery storage — the most important such venture ever tried.
When it begins in two years’ time, its batteries will give the nation a continuing output of 1GW, sufficient to energy greater than 700,000 properties with out having to depend on gas-fired crops when the solar is just not shining.
“This may rework renewable vitality into baseload vitality,” mentioned Sultan Al Jaber, the chair of Masdar. “It’s a first step that might turn into an enormous leap.”
Because the UAE was revealing its new photo voltaic venture, Saudi Aramco, the world’s largest oil firm, introduced a three way partnership that may begin producing lithium, a key ingredient for batteries, as early as 2027.
The 2 international locations, and their neighbours within the Gulf, have at all times been in a position to depend on their considerable reserves of fossil fuels, and each Saudi Arabia and the UAE plan to supply considerably extra oil and fuel within the years forward.
However the Gulf can also be accelerating its use of renewable vitality, spying an financial alternative to make use of low-cost photo voltaic panels, wind generators and batteries for its home electrical energy, and releasing up extra oil and fuel for export.
“The proper recipe [for renewable energy] exists right here,” mentioned Mazin Khan, Masdar’s chief monetary officer, including that the price of the brand new photo voltaic and battery plant could be, for the primary time, “comparable, if not cheaper, than typical fuel”.
“We’ve considerable photo voltaic assets. We’ve relationships with producers that we will leverage to get the very best value attainable. The regulatory market right here within the UAE may be very aggressive and now we have a line of economic banks queueing as much as be a part of the venture.”
Essentially the most energetic corporations bidding for contracts to construct renewable tasks within the Gulf are regional gamers together with Masdar and Saudi Arabia’s Acwa Energy, Asian corporations resembling South Korea’s Kepco, Japan’s Jera and China’s Jinko Energy, and Europe’s TotalEnergies, EDF and Engie.
The broader Center East, together with Iran, Iraq, Israel, Lebanon, Jordan and Syria, is much behind Europe, the US and China in utilizing renewable vitality.
Based on the Worldwide Renewable Power Company (Irena), the Center East has lower than 1 per cent of the world’s renewable capability. However from a low base, it’s also the fastest-growing region outside China, by way of including capability.
With a sequence of big tasks, the Gulf is quickly altering its vitality combine. In 5 years’ time, renewables will make 30 per cent of the overall capability throughout Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, in line with information from Rystad, an vitality consultancy.
“They’ve a number of capital now from oil and fuel, and they’re attempting to turn into much less reliant on anyone supply of vitality,” mentioned Vegard Wiik Vollset, head of renewables at Rystad.
“It is usually an financial profit as a result of they have already got the very best circumstances for photo voltaic of just about anyplace on the earth, and if you may get cheaper electrical energy than it prices for fuel, you’ll be able to export the fuel as a substitute.”
Rystad’s projections are primarily based on a number of new venture bulletins throughout the area, however the vitality consultancy additionally adjusts its forecast to keep in mind that the Gulf’s ambitions look like operating forward of actuality.
Saudi Arabia, for instance, targets to generate 50 per cent of its electrical energy from renewables by 2030, requiring it to put in 130GW of renewables in just some years, sufficient to energy about 25mn properties. “They must ramp up their efforts fairly considerably,” mentioned Vollset.
“2030 is sort of quickly. In fact, within the Center East the turnaround will be very fast, just like the UAE venture. That timeline would by no means occur in Europe and North America.”
The drive for renewables can also be being fed by ambitions to construct AI information centres and fledgling plans to supply “inexperienced” hydrogen — a transition gasoline that’s electrolysed utilizing renewable energy — and export it to international locations the place increased energy costs make its manufacturing uncompetitive.
Kuwait, which solely had sufficient renewable capability to energy a number of thousand properties on the finish of 2023, in line with Irena, awarded a contract in July final 12 months to US engineering agency KBR to create 17GW of renewables, or sufficient vitality for about 500,000 properties, and 25GW of inexperienced hydrogen capability by 2050.
A lot of the suppliers of inexperienced merchandise are Chinese language. At this month’s commerce truthful, dozens of the nation’s main producers crammed into Abu Dhabi’s Nationwide Exhibition Centre, displaying off a spread of merchandise customised for the native market, resembling self-cleaning photo voltaic arrays, with robots that brush away mud and sand to maintain panels operating effectively.
“Our batteries can face up to temperatures of over 60C, and they’re sand, water and wind resistant,” mentioned Yong Liu, a advertising govt at BYD, one among China’s main battery and electrical automobile corporations.
BYD supplied the batteries for Saudi Arabia’s Bisha plant, which till the UAE’s announcement, was the world’s largest photo voltaic and battery venture.
“Enterprise is rising very quick right here and the tasks are large,” mentioned Beijing Hyperstrong, a well-established Chinese language battery firm. “It’s a new rising marketplace for us. Whereas we already arrange a presence in Europe and the US, the Center East is equally essential for us in the long term.”
Nonetheless, the problem might be for Gulf states to combine a speedy rollout of renewables into their energy grids, mentioned Vollset. “What they don’t presently have is the infrastructure, by way of the grid, which is constructed for fossil fuels, not solar energy. So there’s a query mark over how they overcome that impediment.”
Information visualisation by Will Crofton in London
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