In 2022, governments and private sector investors around the world renewed their commitments to develop clean technologies and sustainable infrastructure to reduce the impact of climate change.

It was made clear at the Cop27 UN climate conference in Egypt, however, that more needs to be done if the 1.5 degrees Celsius global warming target set out in the Paris Agreement is to be achieved. 

With the journey towards the UAE hosting Cop28 now under way, Mubadala Investment Company is poised to play a greater role in the fight against climate change and ensuring a sustainable future for all.

Finding solutions

Sheikh Abdullah bin Zayed al-Nahyan, UAE foreign affairs and international cooperation minister, has said that Cop28 will be the ‘Solutions Cop’ – with the goal of turning targets and plans into action. To achieve what is needed to fight climate change, addressing the technology gap with new solutions is critical.

With more than $130tn of investment in clean energy and sustainable infrastructure required by 2050 to avert major climate problems, investors such as Mubadala will play a key role in supporting countries and technology providers. 

Mubadala established Masdar more than 15 years ago with a mission to develop and drive commercially viable renewable energy investments. 

Masdar continues to invest in developing clean energy capacity and innovative solutions – including the world’s first floating wind farm off the coast of the UK and Indonesia’s first floating solar power plant.

Investing in energy projects and clean technologies that improve access to power and accelerate social and economic progress is a priority for Mubadala’s Real Estate & Infrastructure Investment platform.

Selecting the right investment partner is more important than ever as funds seek to diversify and protect their assets. Mubadala’s traditional infrastructure team has successfully identified partners to support its vision – with major groups such as Global Infrastructure Partners (GIP) and BlackRock supporting the development of its portfolio.

The whole energy value chain requires support if decarbonisation targets are to be met
Saed Arar, Mubadala Investment Company

Renewables opportunity

In line with the growing demand for new energy sources, in 2022 Mubadala’s Real Estate & Infrastructure Investments platform, in partnership with BlackRock Real Assets platform, invested $525m in Tata Power’s renewables platform.

Tata Power Renewables will play a key part in India’s energy transition and plans to increase its 4.9GW portfolio to more than 20GW over the next five years. 

In addition to developing solar generation capacity, Tata Renewables will invest in other clean energy sectors, such as wind power, solar cell and module manufacturing and electric vehicle charging infrastructure. 

The whole energy value chain will require support if decarbonisation targets are to be met, offering abundant opportunities for infrastructure funds. 

Offshore wind is expected to be one of the fastest-growing renewable energy sectors over the next 15 years, with the 27GW of installed capacity set to grow to 290GW by 2035. The forecasted growth of the offshore wind market will require annual investments of $50bn.  

In October last year, Mubadala, alongside GIP, acquired a stake in Skyborn Renewables, the world’s largest private offshore wind developer. With a global portfolio of more than 7GW and a 30GW pipeline of offshore wind projects, the acquisition provides Mubadala and co-investors access to a developer with an established presence in Europe and Asia Pacific – key growth markets for offshore wind energy. 

Energy security 

While capital deployments in solar and wind energy resources will continue to rise in the coming decade, a sole focus on renewables will not be enough to meet the Paris Agreement target and will jeopardise energy security. 

Renewables are an intermittent energy resource and with the majority of installed capacity without energy storage, providing cleaner forms of baseload power is vital to enabling energy security while cutting carbon emissions.

The UAE is the first Arab country to develop a nuclear power plant – the federal 5.6GW Barakah project.

While nuclear power offers reliable and carbon-free energy, the significant cost can be a barrier to many countries developing traditional reactors. This is where international technology providers and investors can come together to offer affordable and flexible solutions such as smaller system-integrated modular advanced reactor systems, which can be developed at a fraction of the cost and installed more quickly.

Events in 2022 showed that gas will remain a vital source of power and will be an important bridge fuel during the energy transition. Mubadala’s Real Estate & Infrastructure Investment platform will continue to monitor and support efficient and sustainable power producers to help countries and partners meet their energy security needs.

Low-carbon fuels as the next LNG

Hydrogen opportunity

Hydrogen is emerging as the potential solution to many of the challenges of moving towards a lower carbon future. With green and blue hydrogen, there is the potential to decarbonise energy-intensive industries and the opportunity to store and shift clean energy from one geographical location to another. 

The Middle East and North Africa region is well-positioned to emerge as a global hydrogen hub, thanks to its geographic location, abundant land resources and climate. 

The UAE is aiming to obtain a quarter of the global hydrogen market by 2030, and Mubadala will be supporting partners at home and abroad in investing in technologies and infrastructure to expedite the development of hydrogen as a vehicle for socioeconomic progress and a lower carbon future.