“The Gulf is one of the regions that will face the largest consequences of a future green transition, whatever this might entail. The time for the shift, however, is now”. This declarative point served as the ideal kickoff statement Shipping, Energy and Geopolitics’ (SEG) first event of the 2021-2022 academic year. On Tuesday, November 9th, experts in the field of energy and geopolitics shared their insights regarding the much-debated issue of green energy and the transition to more environmentally friendly technologies, and evaluated the political implications that this might have.
What does ‘green energy’ mean?
In a brief but concise introduction, Professor Matteo Di Castelnuovo provided an introduction on the topic of green energy. ‘What does green energy mean, really?’. Renewable and alternative forms of energy production have captured the attention of those working in the energy sector, but their understanding is limited in the field of related experts. Professor Di Castelnuovo walked the audience through the importance of natural resources for the prosperity and stability of the Middle East and North Africa (MENA) region, shedding particular light on the role of oil in the formation of the economies that we now see in the Gulf. Even though climate change and the need to mediate the impacts of the climate crisis are an issue of international concern, Professor Di Castelnuovo didn’t fail to highlight the particular role of the Middle East and Gulf States and underline their potential in these efforts.
In the transition to a more specific point of view, Mr. Laurent Vivier, Senior Vice President for MENA in TotalEnergies, raised the issue of oil and renewables. Painting them as the two main variables that have the potential to set the course of the region. Mr. Vivier advised not to perceive them as less important than what they actually are. “There isn’t a single country in the region that isn’t looking at renewables, like gas, as a complement to oil and fossil fuels”. The resiliency of the traditional resources that have been used to generate profits and sustain economies for the past years cannot be disregarded, yet the potential of sustainability-driven solutions will be the ultimate driver for this region’s growth. The capabilities that these technologies hold are linked to their price flexibility, which, according to Mr. Vivier, is what makes the Middle East the leader of the energy market.
In the evaluation of this regional green transition, one ought to consider the background and institutional challenges that MENA is facing. By providing a 10-year historical evaluation, Mr. Luca Traini, Manager of the ‘Access to Energy Program’ at Res4Africa, aimed at highlighting the challenges that the region has managed to overcome, but also showcasing the ground that is yet to be covered. “The last 10 years have been very challenging for the MENA region”, he suggested. When comparing it with other regions, like Europe or the Americas, the Middle East has experienced more political insurgencies, turbulence and economic destabilizations than any other region. The Arab Spring and the ongoing civil conflicts are just two of the prime factors that determined a different path for the region. Mr. Traini suggested that geopolitics is the real hurdle in the process towards adoption of greener technologies; it is cooperation that is lacking, not willingness. The importers and exporters of oil and gas in the region embrace their individual agendas according to national goals, but the principle of ‘regional alignment’ is still lacking from their agendas. This is something that needs to change, suggests Mr. Traini, if we are to follow the targets determined by the response mechanisms drafted to mediate the current climate crisis.
Mr. Traini raised another important point, one which isn’t commonly addressed. If we are to indeed move forward with the energy transition, which countries have already accepted as something that is pivotal in the preservation of the climate, we need to leave oil, gas and other such reserves “underground […] below the surface”. And for the Gulf States, this is one hard pill to swallow. Given that their economies are inextricably linked to oil and fossil fuels, pivoting away from their traditional sources of revenue will be the true challenge. The formulation of national policy mechanisms will be a relatively easy task, but detaching their economies from the traditional protagonists of the energy realm will be the challenge. This is why transition needs to happen on a very general scale; moving to green technologies isn’t the concern of the energy market alone, but of society as a whole, given the generalized implications this will have.
The discussion was concluded by Mr. Corrado Çok, freelance analyst for Gulf State Analytics, who broadened the scope of analysis. By extending the focus on the wider Middle East, Mr. Çok confirmed that it is the states of this region that will face the greatest challenges in this process. When it comes to the analysis of their national and international agendas, one can’t fail but notice this duality in the approaches of the Gulf States: they embrace the idea of green energy transition in the domestic sphere, but their stance regarding the use and exploitation of fossil fuels for exporting remains the same – their revenues are simply too big to sacrifice. While it “is increasingly more difficult to meet the energy and economic targets”, Mr. Çok highlighted the necessity of adopting national policies and agendas that will aim towards this process, otherwise the regional countries will “have a hard time adjusting to the new scenarios”. Lastly, the role of European countries and specifically the EU in accelerating this process is a central one, since only with cooperation will we be able to observe tangible results.
All speakers stressed the necessity of this process: the current climate crisis and the possible disappearance of fossil fuels suggest that new paths have to be determined. Even if regional – and world – economies relied on traditional forms of energy production to cover their needs and ultimately produce revenues, alternative sources of energy have to be adopted and embraced. In this undertaking, the element of individuality also needs to be phased out; if we are to move towards greener technologies and lay the foundation for less environmentally harmful forms of technology, innovation and progress can only happen if states unite. Embracing necessity will be the key to preventing future catastrophe.