The US$9 trillion oil king’s climate solution is his hand-picked oil exec

Published Tue, Apr 4, 2023 · 12:12 PM

IN the months before the signing of the Paris Agreement, the then-crown prince of oil-rich Abu Dhabi wondered aloud about the fate of his sheikhdom at the end of the fossil fuel era. “After we have loaded this last barrel of oil, are we going to feel sad?” Sheikh Mohammed bin Zayed Al Nahyan asked attendees at the 2015 Government Summit in the United Arab Emirates. “If our investment today is right, I think-dear brothers and sisters-we will celebrate that moment.”

Soon the sheikh handed the job of running the Abu Dhabi National Oil Company (Adnoc), the world’s 12th-largest producer of oil and gas, to an Emirati renewables executive named Sultan Al Jaber. The move seemed to signal a shift in a country sitting atop about US$9 trillion in untapped oil. The extraordinary wealth generated by Adnoc has filled a sparsely populated desert with gleaming cityscapes, lush golf courses and giant airports over just a few decades. It was to be entrusted to someone who’d spent much of his career making investments in renewable energy and trying without success to build a zero-carbon city in the desert. The mission: Figuring out how to sell energy indefinitely, even if that means doing so at some point-without planet-warming emissions.

Now Al Jaber has been picked again to solve a similarly vexing puzzle. The Adnoc chief is organising COP28, the crucial United Nations climate summit, which will bring heads of state, diplomats, activists and business leaders from each of the world’s nearly 200 nations to Dubai at the end of November. It will fall to him to guide hostile factions to consensus.

That means the job of fixing the climate has been given to an actual fixer, with the power of the host country’s autocratic ruler behind him. But it’s a gamble. The person with the most influence over global warming this year is also the boss of one of the world’s biggest polluters-imagine Exxon and BP combined-who is controlling and thin-skinned to media criticism.

In an hour-long interview with Bloomberg Green, one of the few he’s granted since assuming leadership of COP28, Al Jaber laid out his view that there’s no contradiction in an oil executive running a pivotal climate forum. He says his role as the public face of clean energy from the UAE has often made him misunderstood. “I can tell you that in most of the meetings, people used to react in a different way,” he says, looking back on his early days at state-owned renewables company Masdar. “Some would get very excited, and some were puzzled: ‘You’re a major oil-producing nation.’ “

Green groups are indeed angry that an executive overseeing the expansion of Adnoc’s production capacity-and, as a result, an increase in its already massive emissions-is also organising the process by which countries are pledged to rapidly curtail greenhouse gases. More than 400 climate and environmental groups sent a letter to the UN secretary-general saying that Al Jaber’s work “threatens the legitimacy and efficacy” of the summit. More than two dozen US lawmakers petitioned for diplomatic pressure to force him out.

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Critics fear the oil business will be enmeshed in the climate summit, and there are indications this is already happening: Some consultants and staff working on COP28 are being paid by Adnoc, according to people who didn’t want to be named speaking without permission. (Representatives for Al Jaber said in a statement that the budget for COP28 comes from the UAE government and “strict rules of governance” ensure separation from the state oil company.)

Even a longtime COPgoer such as Sandrine Dixson-Declève, co-president of the Club of Rome, is telling colleagues to consider staying away. “It’s really incredible how far and wide it’s gone, including some very senior people,” she says of her concern over the reach of Adnoc’s money.

The backlash has frustrated Al Jaber, according to interviews with more than four dozen of his colleagues and associates, many of whom asked not to be named. He expected his years of working on sustainability to earn an embrace from the COP community.

And some leaders did, including important diplomats. The Maldives, an island nation vulnerable to even small increases in sea levels, endorsed Al Jaber. So did European Union climate chief Frans Timmermans, an emissions-cutting hawk who nearly stormed out of last year’s COP27 to protest the failure to reach a stronger agreement on curbing fossil fuels. US climate envoy John Kerry suggested that what critics derided as a conflict of interest-a diplomat who’s also a businessman would actually help solutions “move faster and at scale”.

Something Al Jaber and his critics awkwardly agree on: We need a fix, right now. Eight years out from Paris, the UN process is considered crucial even though it hasn’t achieved rapid progress. Greenhouse gas emissions hit record levels again in 2022, boosted by an energy crunch and rising demand for coal that followed Russia’s invasion of Ukraine. The upcoming summit will also be shaped by the latest UN climate report, published in March, which calls for an immediate reduction in emissions. “We were dealing with different circumstances,” Al Jaber says of the era that produced the breakthrough moment in Paris. “The purpose of everything we’ve been doing in the previous COPs has changed.”

A key architect of Paris counts herself among those calling for change: “COP summits can’t continue with business as usual,” says Laurence Tubiana, chief executive officer of the European Climate Foundation. In a letter to the UN, Tubiana, Dixson-Declève and other high-level experts have laid out ways to reform the process, including shrinking the number of attendees and creating concrete plans to eliminate fossil fuels.

Al Jaber, 49, wants “transformational progress”. Even if reforming the COP process doesn’t appear on the agenda, there’s still a chance for a breakthrough at COP28 by getting a key phrase into the final communiqué: Phase out oil and gas. Last year’s summit, hosted by Egypt, ended with fossil-friendly nations making rearguard actions to strike out such language. The UAE’s Environment Minister, Mariam Almheiri, has already tested a pitch to “phase out oil and gas in a just way” in a recent talk at a diplomatic gathering in Germany.

Al Jaber will use the UAE’s growing diplomatic muscle to try to cut short the fights at COP meetings-wealthy Global North versus less-developed South, Europe versus Russia, US versus China-that inevitably bog down progress. He alone can’t force a consensus among all countries. But as COP president he will set the limit of what kind of progress is possible.

Al Jaber’s family hails from Umm Al Quwain, one of the smallest of the seven emirates that form the UAE, putting his origins at a remove from the ruling elite in Abu Dhabi. In a country where power is the preserve of Emiratis, who make up a small minority of today’s population, Sultan’s mother was an emigre. That makes his ascent all the more remarkable.

As a bright student from a small country-the UAE had only about 1 million people in his youth-he progressed quickly and secured scholarships from Adnoc, which was investing in young talent to work in the country’s fast-growing oil and gas business. He studied chemical engineering at the University of Southern California and business administration at California State University at Los Angeles, before completing a PhD in economics at Coventry University in the UK.

In between degrees, he returned home to work for Adnoc on oil and gas projects. The early part of Al Jaber’s career coincided with debates about whether oil production might peak, just as advances were making it financially attractive to harness wind and solar energy. Sheikh Mohammed, who became crown prince of Abu Dhabi in 2004, took an interest in the career of the talented and skilled Al Jaber and told him to go on a world tour to find out where renewable energy stands.

Over three months Al Jaber travelled to 15 countries on four continents and returned with a grand plan. He imagined a sustainable city to train people on the deployment of green technologies. He wanted to establish a planned suburb of 50,000 people near the Abu Dhabi airport and to make the whole complex carbon-neutral. By 2008 his bold vision got hefty backing from the sheikh, who committed US$15 billion to create Masdar City.

Al Jaber’s enthusiasm for renewables baffled those who met him in this era. “It was nonsensical to imagine that Abu Dhabi can be a centre for clean energy,” says Olafur Ragnar Grimsson, who as president of Iceland at the time hosted Al Jaber on his tour, showing how geothermal power drove his country’s development. But in the end, the politician came to believe in Al Jaber’s approach and has since become a juror for a sustainability prize named after the UAE’s first president.

A visit to Masdar City in February finds a 45-metre tower at the centre of the site that channels cool air onto shaded streets. A pair of autonomous electric vans run a route of a few hundred metres. There’s a 10-megawatt solar project visible on the edge of town, but it’s not enough to satisfy demand from even a small population. Some electricity is drawn from the mostly natural-gas-powered grid, meaning what little has been built isn’t close to carbon-free.

Most of the development zone remains empty after 15 years of work. A 2016 deadline for completion has come and gone; a new target has been set for 2030. Masdar the company, which Al Jaber continues to lead as chairman, is now primarily focused on deploying and operating renewable energy projects, including utility-scale solar plants in Uzbekistan, wind farms in the US and a waste-to-energy plant in the UAE.

Like many energy-producing nations, the UAE’s efforts to tip the scales towards a cleaner future are far outweighed by its carbon-heavy present. As of 2021, for example, Masdar reported that its investments in more than 40 countries prevented 7.5 million tons of carbon dioxide emissions each year. Those savings pale compared with the emissions of the giant oil company that Al Jaber also runs. Adnoc Gas and Adnoc Distribution-just two subsidiaries-accounted for 45 million tons of CO2 equivalent emissions in 2021, according to Bloomberg estimates.

And though Adnoc claims to power its own operations with nuclear and solar, it’s not really possible to measure Al Jaber’s success at decarbonisation, because the company doesn’t report its aggregate emissions. Almost all of Adnoc’s peers who’ve set net-zero goals-including Saudi Aramco, Exxon Mobil and TotalEnergies-also publish much more detailed data; representatives for Al Jaber said Adnoc is currently working to report emissions from its own operations. What is clear: Adnoc’s emissions are going to rise in the short term. It plans a 25 per cent increase in oil production capacity, to 5 million barrels a day by 2027.

This is the tension that drives Al Jaber’s climate critics to frustration. He embarked on his travels ahead of COP28 by insisting that the 1.5C goal is “non-negotiable”. Those two positions-vastly expanding hydrocarbon production and slowing the world’s runaway dash past the temperature limit set in Paris-are hard to reconcile. A company can’t increase oil production and say it is in line with Paris goals: “Both of them cannot happen at the same time,” says Fatih Birol, head of the International Energy Agency, without singling out Adnoc or Al Jaber. “I’m sorry, but they have to choose.”

Between founding Masdar in 2006 and taking the top job at Adnoc in 2016, Al Jaber rose in power and prominence. He has a wide array of responsibilities across many different organisations and industries. His LinkedIn profile would be epic if it included them all, but only six are listed.

He became a member of the UN’s advisory group on energy and climate, as well as chairman of Abu Dhabi Ports in 2009. The following year he assumed the position of climate envoy for the UAE while running a successful campaign to put the permanent headquarters of the newly created International Renewable Energy Agency in Masdar City. In 2011 he wed the daughter of Mana Al Otaiba, one of the longest-serving oil ministers, and then became minister of state in 2013. Three years later his portfolio expanded to include chairman of the National Media Council in charge of domestic media and government messaging. Added recently: chairmanship of the Emirates Development Bank and government minister for industry and advanced technology. He also sits on the boards of at least a dozen organisations, including a university focused on artificial intelligence.

How does one person hold so many jobs simultaneously? Alok Sharma, president of COP26, had to give up his only other job, as a minister in the UK government, to plan the 2021 climate summit held in Glasgow. Al Jaber’s advisers suggest that capable Emiratis are often responsible for many roles and that he’s particularly good at delegating and recruiting. Most say he works constantly and seems well prepared in meetings.

Climate diplomats describe him as charming, but Al Jaber also has a reputation for being brusque and transactional. His advisers say he has a favourite question for employees at Adnoc: “What value do you add to the company?” But Grimsson and others who’ve worked with him over the years describe his abrupt manner as the price paid for getting things done.

The UAE has only had presidents from the Al Nahyan family since its founding, and the power structure rewards people who are loyal and deliver on difficult jobs. In 2015, Al Jaber managed the UAE’s aid to Egypt, flying often to Cairo to speak with President Abdel-Fattah El-Sisi, who’d earlier overthrown the democratically elected Mohamed Mursi. “He was kind of the viceroy of Sheikh Mohammed in Egypt for many years, and it started after the coup,” says Andreas Krieg, a lecturer in Middle Eastern security issues at King’s College in London. Soon after taking the top job at Adnoc, Al Jaber oversaw thousands of job cuts, angering Emiratis who’d assumed the company would provide a well-paying job for life.

In his media role, Al Jaber helps maintain strict control on local media and Arabic content partnerships with Sky News and CNN, according to people familiar with the matter who asked not to be named for fear of repercussions. Several people who have worked at the National, a publication owned by Sheikh Mohammed’s brother, said they believe Al Jaber has tried to influence coverage to manage diplomatic relationships with UAE allies.

A spokesperson for Al Jaber said, “The suggestion of editorial interference is not supported by any evidence.” Representatives for Sky News Arabia and the National denied allegations of interference and said they are editorially independent. CNN Business Arabic did not respond.

Now comes another difficult job, with a large element of media management. COP28 marks only the second time a major hydrocarbon-dependent economy has hosted the UN climate summit, and the last time COP18 in 2012, hosted by Qatar-predated the Paris Agreement.

Expectations are different now, with the pathway to net zero enshrined as a political priority by all 10 of the biggest economies. The world is also being battered by increasingly worse climate-linked disasters. That combination keeps climate top of mind, and the outcomes of COP meetings now make headlines around the world, because inevitably the progress is too slow.

A hallmark of unfulfilled promises made at COP is the missing US$100 billion in annual payments to developing countries for cutting emissions and adapting to the warming climate. “If we cannot finally get the US$100 billion in climate finance, we shouldn’t be continuing,” says Dixson-Declève.

There’s a reason the COP process isn’t set up for success. Meetings are still run on rules set more than 30 years ago that, crucially, require unanimous agreement. Those rules came about because oil giant Saudi Arabia blocked majority voting, making it possible for one country to hold the outcome hostage. That’s why COPs tend to produce the bare minimum that every country can sign off on.

Jennifer Morgan, Germany’s climate envoy, said in an interview that a successful COP28 comes down to delivering on a long list of needs: stronger commitments to curb emissions, expanding financial help for developing countries to manage the green transition and paying for damages caused by climate change. “COP presidencies are looked at and judged by the outcomes,” she said.

But small things beyond the control of even a controlling COP president can shape the way the summit is perceived. Take the fight at last year’s COP summit involving the EU, the US, India and a group of vulnerable countries that wanted a science-backed agreement on phasing out all fossil fuels, which was blocked by Saudi Arabia, China, Egypt and others. That fight is likely to be revived in Dubai, with Morgan expecting the EU to once again push for a harder line on emissions. Al Jaber, playing referee, will have wide discretion over how it’s handled.

Beyond the things delegates butt heads over, the UN climate summit is now an annual jamboree for corporations with a viewpoint on the energy transition and a way to sell it. For years there’s been an UN-provided “green zone” for nonstate actors to showcase their ability to help meet global climate goals. In other words: It’s a trade show. The UAE expects to host a record 70,000 attendees for COP28 in the glitzy setting of Expo City, recently the site of an actual trade show with 192 countries represented. Protests have become a major part of COPs, and there are signs that the severe restrictions in place for COP27 in Egypt will be repeated in the UAE.

Al Jaber has been clear that he hopes one industry, in particular, feels welcome. “I know that some of you have felt excluded from the climate dialogue in the past,” he told oil and gas executives in March in Houston, the heartland of US energy. But he’s also appealing to his peers: “The oil and gas sector needs to up its game, do more and do it faster.”

Advisers working on Al Jaber’s COP28 team see this priority translating into initiatives that will urge companies and governments to go further than the consensus achieved in the formal text of the meetings. One example is the “energy transition accelerator” that will be launched ahead of the summit, allowing governments to make advanced purchase commitments for decarbonised versions of cement, steel or aluminium and create markets for necessary commodities that sell with a green premium.

It won’t mark a radical departure from recent COPs. Each summit sees a deluge of announcements from governments and corporations trying to align with global goals. Most of the time these initiatives end up gathering dust after a showy reception. Al Jaber’s team wants to make sure that doesn’t happen. Precisely how that will be done isn’t yet clear.

The buildup will offer Sheikh Mohammed, who became president of UAE just in the past year, a crucial opportunity to shore up the country’s climate credentials. Although it’s the first country in the Middle East to set a goal to reach net zero by 2050, its per-capita CO2 emissions are among the world’s highest. It’s home to some of the world’s biggest renewable projects, and yet much-less-sunny Belgium still generates more solar power. The COP28 team said the UAE’s environment ministry is working on submitting new commitments to the UN to reduce emissions, so-called nationally determined contributions. The watchdog group Climate Action Tracker says the current plans are “highly insufficient”.

In the heightened atmosphere of COP meetings, it can feel as if everyone who cares about the future of humanity is gathered in one place. That extraordinary vibe will allow the UAE to invite people who’ve never considered an oil monarchy as a climate ally. Al Jaber’s royal patron will spare no expense in trying to convince the throngs that it’s the new global hub for all things green, from technologies to financial services.

But it will only work if Al Jaber can deliver on the delicate but weighty negotiations. He needs to show he’s an “honest broker”, says Romina Pourmokhtari, Sweden’s climate minister. If he falls short, “the UAE are the ones who are going to lose internationally-reputation-wise, prestige-wise”. BLOOMBERG

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