Saudi Arabia, the world's top crude oil exporter, announced yesterday ambitions to reach net zero greenhouse gas emissions by 2060, setting out an initial $190bn spending plan.
The announcement by Crown Prince Mohammad bin Salman was made at the kingdom's first Saudi Green Initiative Forum in Riyadh, just days ahead of the Cop 26 UN climate meeting in Glasgow next month.
Saudi Arabia joins Russia and China in targeting net-zero emissions by 2060, while the US, EU and neighbouring UAE are aiming for 2050.
In the meantime, Saudi Arabia aims to reduce carbon emissions by more than 278mn t/yr by 2030 - twice as much as it was targeting under its earlier nationally determined contribution (NDC) - while also cutting methane emissions by 30pc.
Prince Abdulaziz bin Salman, the crown prince's older half-brother and Saudi energy minister elaborated on the plans, while also hitting out at critics who argue hydrocarbons must be phased out urgently.
Although renewables will play an important part in reducing emissions, "the world cannot operate without hydrocarbons, without fossil fuels, without renewables. None of those things would be the rescue. It has to be a comprehensive solution," Prince Abdulaziz said.
State-controlled energy giant Saudi Aramco is pressing ahead with plans to raise its production capacity to 13mn b/d by 2027, up from its current 12mn b/d, while also pledging its own net-zero targets. The company said yesterday it hopes to achieve net-zero "across its wholly-owned operated assets" by 2050. Further details about how it will deliver that goal that will be issued in the second quarter of next year.
"No one should be too facetious about what tools are in kits that everybody has," he said. "But if the tools in your kit and mine deliver emissions reductions, that's the ask and that's the objective," the prince said.
Reducing its emissions would be centred on efforts to expands renewable energy production, capturing and storing or using CO2, including directly from the air, alongside the development of hydrogen and low carbon fuels.
Total CO2 emissions from the kingdom, the largest economy in the Middle East region, stood at nearly 500mn t/yr in 2019, according to data from the IEA, more than double its emissions from the turn of the century. Its per capita emissions have also grown from 11.35t in 2000 to 14.45t in 2019.
Almost half the total emissions come from power generation. But under Saudi Arabia's ambitious plans to largely eliminate the burning of liquid fuels to generate power, Riyadh aims to have renewables supplying 50pc of power by 2030, and gas the other 50pc. As of 2020, renewables accounted for less than 1GW of the kingdom's 82GW total power generation capacity, according to data from industry association Irena.
The first package of initiatives represent investments worth more than Riyals 700bn ($187bn). But Riyadh is not looking for financing. "This is not contingent on any type of grant or financing," Prince Abdulaziz said. "It is more dependent on the evolution of technologies."
Hydrogen and the circular carbon economy
Alongside the expansion of renewable energy for power generation, Saudi Arabia will deliver on its targets using the "circular carbon economy (CCE)" approach which advocates the 4Rs: 'reduce, reuse, recycle and remove.' Broadly, the CCE envisions using renewable energy, increasing efficiency, and even monetizing CO2 by creating products, recycling them, and building new carbon sinks such as forests of newly planted trees. What this means in practice will be clearer when Riyadh issues its CCE strategy, giving guidance on key performance indicators, milestones and targets for the ministry to assess.
"The transition to net-zero carbon emissions will be delivered in a manner that preserves the kingdom's leading role in enhancing the security and stability of global energy markets," Saudi Arabia said.
The extra decade Saudi Arabia has given itself relative to the UAE and some of its western counterparts allows for more time not just for the technology required to "mature," but also for the kingdom to adjust its oil-dominated economy without "risking social or economic effects," Prince Abdulaziz said. Saudi Arabia has already undergone a rapid social transformation in the last few years under the de-facto rule of Prince Mohammed bin Salman.
Aramco is already eyeing the potential to dominate the emerging hydrogen industry, just as it dominates the oil sector. Keen to become a first mover, it exported a 40-tonne pilot shipment of blue ammonia - a vector for hydrogen as a fuel - to Japan in September for use in power generation. It was a world first.
The kingdom is targeting hydrogen production, both blue and green, of 29mn t/yr by 2030 and 40mn t/yr by 2035. "Show me another country that will do that", Prince Abdulaziz said. But the expansion will have to be rapid, with the first green hydrogen project, at Neom in the northwest, set to produce only 240,000 t/yr by 2025.
By Adal Mirza
Argus Media Limited published this content on 24 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 October 2021 13:23:05 UTC.