Investment in green energy continued in October. This time it was Egypt that opted to invest in solar power with a US $109 million project for a 62 MW plant in Kuraymat - a deal which is partly funded by the Global Environment Facility (GEF).
While it is always a hot topic, genuine commitment to sustainable energy is often thrown into question. A recent survey by the London-based Economist Intelligence Unit found that only 45% of over 200 companies polled worldwide had a programme in place to reduce their carbon footprint. What is more, among those that do have a carbon reduction strategy, 52% had set themselves no specific targets.
Per capita carbon emissions in the Middle East rank as the highest in the world. Amid fears of global warming, there are predictions that temperatures in the UAE could rise by 1-2°C by 2030. But if environmental concerns are not motivation enough for companies to reduce their footprint, perhaps emissions trading could alter the picture somewhat.
Emissions trading revolves around a cap set by a government with regard to the level of emissions a company produces. Companies are required to hold a number of credits equivalent to the amount they have the right to emit.
The total amount of credits cannot exceed the cap, thus limiting total emissions to that level. Companies that need to increase their emissions must buy credits from more environmentally-friendly companies which pollute less, with the transfer of these credits constituting the trading element.
With emissions trading systems already in place in the United States and the European Union, could a scheme perhaps be introduced across the GCC in the near future?
There may be some time to wait. Not many Clean Development Mechanism (CDM) projects, which aim to reduce emissions in developing countries as per the Kyoto Protocol, have been registered in the Middle East so far.
"Once a significant number of CDM projects have actually been registered, and come on-stream with the generation of carbon credits, we believe that will signal a process where the trading of such credits will be a logical next step," says Tilak Doshi, executive director, energy, at Dubai Multi-Commodities Centre (DMCC), which is seeking to turn Dubai into the region's emissions trading hub.
The potential to make carbon trading big business is certainly there - but first there needs to be a strong show of commitment to cut pollution.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.