UAE utilities reform must match Masdar ambitions

25 January 2008

An integrated strategy is required if the federation is to throw off its tag as the planet's most polluting nation.

To work, initiatives have to go hand in hand with widescale reform.

The flurry of announcements by Abu Dhabi Future Energy Company (Masdar) in late January was impressive in its scope and ambition. By developing the world’s largest hydrogen plant and solar power project, as well as the world’s first carbon-neutral city and a nationwide carbon capture and storage programme - the oil-rich emirate is taking action while larger developed nations prevaricate.

It should be applauded for this. Yet the challenge has only just begun. Given that nobody has attempted schemes on such a scale before, there will be huge technical hurdles to overcome if the projects are to be successful.

Commercial concerns are another important factor. Saving the planet does not come cheap. The zero-emission schemes are up to four times as costly as conventional power generating sources, and somebody, somewhere will have to shoulder the greater financial burden. This will be another test of Abu Dhabi’s commitment.

Ultimately, however, such initiatives, if they are to work, will have to go hand in hand with wide-scale reform of how utilities are distributed and paid for in the UAE.

Tariffs for water and electricity are currently among the lowest in the world, and without programmes to encourage energy conservation, all the good intentions will only be half fulfilled.

An all-encompassing, integrated federal strategy is required if the federation is to throw off its tag as the planet’s most polluting nation per capita. Only then will the job be done.

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