We’re going to get beaten up about fossil fuels. Big surprise.

COP28 is underway this morning, and talks over the next 13 days will influence investment and divestment plans in renewables and hydrocarbons — and say a lot about policy directions in the Mideast as well as in key energy markets and investment partners.

WHAT TO WATCH FOR- Big themes include measures to better adapt to the impact of climate change and increase our resilience in the face of the human suffering inflicted by climate-triggered crises. An agreement to finally make real the USD 100 bn loss and damage fund could also be in the works, and food security is expected to take center stage since it has become a more pressing issue after Russia’s war in Ukraine disrupted supply chains. It would be naive not to expect disagreements on the timeframe for phasing out oil and gas.

THE KSA ANGLE- It’s not about phasing-out oil and gas — it’s about phasing-in new tech and renewables. Expect the Saudi delegation to push for policies and investments that focus on climate resilience and adaptation, while advocating for a move in a balanced direction that recognizes the pivotal role energy security plays in ensuring a gradual and sustainable transition toward a green future.

Minister of State for Foreign Affairs Adel Al Jubeir made that point last year, when he told CNBC in Davos that “we have the technology, we have the science, and we have the financial resources to deal with these issues [climate change]. What we are lacking is a rational debate based on science and reason. A non-emotional debate [not one] that’s driven by grandstanding and the desire to score political points.”

Will Saudi pay for climate damage? They want us to, but don’t hold your breath.Former UK prime minister Gordon Brown told the Guardian on Tuesday that “oil states” should be subject to a USD 25 bn levy on revenues to help pay for climate damage, a narrative that draws on Ireland’s Environment Minister Eamon Rya’s words during COP27 when he said that “large emerging economies with significant resources should be included” in funding the climate transition for less-developed countries.

We’re having none of it: Paying freight for less-developed countries “must be all the responsibility of the developed world,” a top Saudi official said at the time.

Maybe it’s worth getting the fund up and running before trying to squeeze KSA? The fund, which is supposed to disburse USD 100 bn to cover the cost of climate-related loss and damage, which was first proposed in 2009 only got buy-in last year. It still hasn’t received or disbursed a penny.

POLICY- A clear message for COP28: Given the Kingdom’s role as a major oil exporter, Saudi energy officials and climate envoys are expected to hold their ground by reiterating that energy security is a prerequisite to tackling climate change. “You can’t attend to climate change without getting energy security,” said Energy Minister Prince Abdulaziz bin Salman Al Saud at the World Government Summit last year (watch, runtime: 5:16). The minister went on to explain that ensuring energy security provides the means to tackle climate change.

INVESTMENT- The Saudi delegation will talk up investment in climate and climate-related projects aligned with the Kingdom’s Vision 2030 goals including attracting funding for initiatives related to renewable energy, green infrastructure, and other environmentally friendly projects. The goal is clear: To use conventional energy proceeds to diversify the economy and emerge on the other side a dominant player in the global (green) economy.

ZERO TOLERANCE- Delegations of OPEC+ member countries will push back on calls to divest from oil and gas assets just like they have recently accused the International Energy Agency (IEA) of vilifying the industry by saying it has to choose between shifting to clean energy or worsening the climate crisis. OPEC, de facto led by top oil exporter Saudi Arabia, also described the IEA’s prediction that world fossil fuel demand would peak by 2030 as “dangerous,” saying that this jeopardizes energy security by fuelling calls to stop new investment in oil and gas.

REMEMBER- The Kingdom has committed to have 50% of its power generated from renewable sources by 2030. And like Russia and China, we have a target to reach net-zero emissions by 2060, while the USA and the EU are aiming for 2050.

Some 13.76 GW of renewables are currently under development: The government along with its private sector partners are investing heavily in renewables with 13 solar projects, 4 wind projects and a green hydrogen plant in Neom currently under development. This is complemented with a plan to accelerate the implementation of the Circular Carbon Economy National Program to reduce, reuse, recycle and remove carbon emissions. We currently have 700 MW of renewable energy capacity connected to the grid.

Will you be in Dubai for COP? Make sure to stop by the Saudi Green Initiative Forum on Monday, 4 December, if you are.

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