Gasoline sells for 45 cents a gallon. There is little public transportation and no recycling. Residents drive between air-conditioned apartments and air-conditioned malls, which are lighted 24/7.
Still, the region’s leaders know energy and money, having built their wealth on oil. They understand that oil is a finite resource, vulnerable to competition from new energy sources.
So even as President-elect Barack Obama talks about promoting green jobs as America’s route out of recession, Gulf states, including the emirates, Qatar and Saudi Arabia, are making a concerted push to become the Silicon Valley of alternative energy.
They are aggressively pouring billions of dollars made in the oil fields into new green technologies. They are establishing billion-dollar clean-technology investment funds. And they are putting millions of dollars behind research projects at universities from California to Boston to London, and setting up green research parks at home.
“Abu Dhabi is an oil-exporting country, and we want to become an energy-exporting country, and to do that we need to excel at the newer forms of energy,” said Khaled Awad, a director of Masdar, a futuristic zero-carbon city and a research park that has an affiliation with the Massachusetts Institute of Technology, that is rising from the desert on the outskirts of Abu Dhabi.
These are long-term investments in an alternative energy future that neither falling oil prices nor the global downturn seems likely to reverse. Even as the local real estate market is foundering, leaders in politics, business and research from across the globe will flock to Abu Dhabi for three days starting Monday for the second World Future Energy Summit, which just one year after its inception here has become something of a Davos gathering on renewable energy.
This year’s guest list includes a former British prime minister, Tony Blair, and the European Union energy commissioner, Andris Piebalgs, as well as the oil and gas ministers of Oman, Bahrain and the United Arab Emirates.
In attendance will also be executives representing hundreds of companies, large and small, from BP and Credit Suisse to dozens of start-up companies from Europe and the United States.
“Truth is that locally money is tight as everywhere, and the property market is certainly taking a correction downwards,” said Richard Hease, whose Dubai-based company, Turret Middle East, organized the conference. “But on the renewable energy front, it is business as usual.”
This new investment aims to maintain the gulf’s dominant position as a global energy supplier, gaining patents from the new technologies and promoting green manufacturing. But if the United States and the European Union have set energy independence from the gulf states as a goal of new renewable energy efforts, they may find they are arriving late at the party.
“The leadership in these breakthrough technologies is a title the US can lose easily,” said Peter Barker-Homek, chief executive of Taqa, Abu Dhabi’s national energy company.
“Here we have low taxes, a young population, accessibility to the world, abundant natural resources and willingness to invest in the seed capital.”
“You see what the Gulf states have achieved in terms of modern infrastructure and beautiful architecture, but this has come at a very high environmental price,” said Awad of Masdar, standing in a field of 40 types of solar panels that the project’s engineers are testing, and using to power offices.
