The UAE is on the leading edge of capital deployment

By Frank Fannon

I was pleased to be in Abu Dhabi for his excellency Dr. Sultan Al Jabber’s first public address since being named as president of this upcoming cop; he brings a degree of credibility to this process. It’s been ongoing for many years because he understands the energy world in the climate change issue, from serving at high-level posts within the entities advancing energy and the energy transition directly.

Rather than just being someone who speaks from it from a political perspective, he also brings the status of the UAE and also as a leading figure in the energy world from someone who operationalizes and executes. Too often, the discussion around climate change has been focused on ambition. But ambition without execution is merely a dream. And I was struck by his excellency’s comments to make this cop one of action over just a well-intentioned political speech.

UAE has been on the leading edge of discussing the energy transition for many years. I think that this is an opportunity for the UAE to demonstrate how they’ve been acting, their development, and the innovation that’s going on at Masdar; for example, I expect they will be put on full display.

I was pleased when I served in the US government to go there and see and talk to the experts about what they’re doing and how they’re driving forward. The story of the energy transition, but also energy security, brings both parts of the equation and produces the traditional base of energy in those contexts of oil and gas. And doing that and always striving to do it in a way with reduced emissions and higher production. But that’s complemented by innovation and the significant expansion of opportunity in the energy transition in the clean energy dimension.

I was also struck by how the integration of some of the capital formation that the government is moving forward through its sovereign wealth funds and that they, too, are putting capital into this. The level of capital that the UAE is committing to the energy transition goals is commendable, but perhaps more so is capital deployment . Frequently, governments speak about what they seek to do. But the capital deployment and the operationalizing of big strategies are often slow. The UAE is not there. They’re on the leading edge of that. And I’m pleased to see that the US is looking to partner with them more and more meaningfully, bilaterally but also in other parts of the world in terms of energy, and the transition of power, directly. Still, notably here, they’re also focused on the industry.
Because energy is something that we want to produce, but energy is only helpful to the extent that it’s used.

The industry employs people. The sector provides manufacturing economies. And the focus also that was announced in Abu Dhabi recently was to focus on those hard-to-abate sectors, such as green steel. Steel is required to provide the skeleton of the energy transition, the bones of infrastructure. And we need to ensure that those bones are also done in a way that mitigates climate impacts and the level of commitment.

In conclusion, the alignment of strategies in the US and the UAE under these complex hard to abate sectors like green steel will be something to celebrate.

ABOUT THE AUTHOR
Francis R. Fannon served as the inaugural United States Assistant Secretary of State for Energy Resources position, serving in that capacity since 2018.He left office in 2021. He is currently managing director of Fannon Global Advisors, a strategic advisory focused on geopolitics, energy transition, and market transformation. You can follow him on Twitter @Frank_Fannon

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