The United Nations (UN) Climate Change Conference COP28, held in the United Arab Emirates (UAE) in November-December 2023, committed 100 nations to tripling renewable energy capacity by 2030, the point at which science tells us that greenhouse gas emission (GGE) needs to be cut by 43% compared to 2019 levels of 33.2 Gt to limit global warming to 1.5 degrees Celsius. Financial pledges were subsequently made to the Green Climate Fund (GCF) and the High-Level Champions under the Marrakech Partnership for Global Climate Action launched to implement a roadmap for 2030 Climate Solutions.

The Gulf Cooperation Council (GCC) states, i.e. Saudi Arabia, Bahrain, Kuwait, Qatar and the United Arab Emirates (UAE), embraced the Global Goal on Adaptation (GGA) requiring climate finance, technology and capacity building, to meet the 2030 roadmap. Although it is estimated that hydrocarbons currently constitute 99% of GCC primary energy consumption, a new report by the International Renewable Energy Agency (IRENA), Renewable Energy Markets: GCC 2023, shows that GCC countries can tap into existing resources to develop innovative renewable energy solutions in order to diversify their fossil fuel economies.

COP28 shed light on this reality, as has the World Bank, which highlights that the GCC can leverage renewable energy for multiple applications in water resource management, directly impacting the lives of 60 million people across the region, to fuel desalination plants, replenish marine environments in need of fresh water, promote efficient water use, and manage wastewater. These are steps that will increase future water and energy capacity for the region. 

The GCC countries could also be leaders in renewables, and finance renewable projects worldwide. The World Bank estimates that their combined Gross Domestic Product (GDP) will reach $6 trillion by 2050, and that a green growth strategy and economic diversification could increase the figure to $13 trillion, offering a strong reason for GCC economies to embrace COP28 renewable goals.

To date, however, renewables still account for only a small share of the GCC’s electricity capacity. This reality suggests that the region’s energy transition toward renewables must be accopmanied by a broader transformation of its fossil fuel-based energy model. Large-scale renewable energy projects will therefore be essential for helping the GCC reach its climate goals, although they are unlikely to fully eliminate the region’s significant dependency on fossil fuel production and exports in the near future. The bloc has so far committed to supporting efforts to cut global emissions by half, strengthen climate resilience and ensure a new era of climate policy implementation within the framework of the landmark Paris Climate Agreement of 2015. Meanwhile, Saudi Arabia aims to generate half of its energy from renewables by 2030, and the UAE 44% by 2050. By 2030, Oman says it will generate 30% of its energy from renewable sources, Kuwait 15% and Qatar 20%.

COP29 held in Azerbaijan in 2024 accelerated global renewable capacity goals by adopting policies designed to increase climate finance goals to US$1.3 trillion annually by 2035. COP29  saw GCC renew its commitment to tripling renewable energy targets, advancing green energy partnerships, and committing to a Global Energy Storage and Grids Pledge and the Hydrogen Declaration to scale up storage.

COP30 held in Brazil in 2025 committed the GCC to a just transition to protect oil and gas revenues but use it for a landmark US$100 billion investment pledge (which the bloc aims to increase globally to $1 trillion) in order to produce 102 GW of new renewable energy by 2030, with a regional total capacity of 165 GW. To this end, the GCC also aims to double grid investment, expand energy storage, and phase out fossil fuel incentives, to advance the COP28 UAE Consensus and Global Renewables Alliance goals.

These goals address the global energy crisis by reducing vulnerability to fossil fuel. The hydrocarbon-rich GCC states have therefore set ambitious renewable energy targets to achieve energy mix targets that infuse abundant fossil fuel industries and revenues with renewable energy sources. Global Stocktake which observes greenhouse gas emissions by 2025 meanwhile calls for reduced emissions of 60% by 2035, placing GCC countries on the path of net-zero emission (NZE) by 2050. This goal and other important climate initiatives could mean bringing renewable energy capacity to more than 20% higher than current projections by 2030. These ambitious plans will require further investment, as the cost of renewables, especially wind and solar projects, may increase, according to the International Energy Agency (IEA).

Overview of GCC Renewable Goals and Policies

The GCC benefits from strong solar potential, particularly during periods of peak energy demand driven by hot summers conditions. This makes the region well positioned to expand renewable energy development, including solar and wind power, as well as explore opportunities in biomass, geothermal energy, hydrogen, and nuclear energy.

Bahrain has announced plans to double its renewable energy targets as parts of efforts to diversify its energy mix by 2035. Kuwait has also developed a strong institutional framework for renewable energy projects, including major initiatives such as the Shagaya Renewable Energy Park. Similar to Qatar and Bahrain, Kuwait has also committed to NZE frameworks with target years ranging between 2050 and 2060. Qatar is investing heavily in solar energy to support its energy needs, including supplying power to major gas operations in Mesaieed and Ras Laffan. Oman is developing the large-scale Ibri III Solar project and the Mahout Wind Farm. It has a Vision 2040 which includes the target of 20% energy mix by 2030, and almost 39% by 2040. It has also targeted carbon neutrality by 2050 with a roadmap focused on massive investments in green hydrogen production and large-scale solar power. Saudi Arabia is setting higher goals to ensure growth in its electricity mix to rise from less than 1% in 2019, to 50% in 2030. It pledged to reach NZE by 2060 through the Saudi Green Initiative (SGI). Leading in the GCC, the UAE’s Operation 300 billion strategy aims to develop new renewable industries by 2031 and generate broader socio-economic benefits from the energy transition. 

Most GCC renewable industries will include wind farms and the installation of solar energy and other technologies to boost hydrogen and triple nuclear energy capacity production by 2050 at 24/7 baseload power levels. It means the GCC states will need to invest an estimated US$66 billion in renewables and US$82 billion in grids and storage annually, to unlock renewable integration. To this end, COP30 - Global Renewables Alliance platform enables the collection of GCC data outlining economic and structural transitions taking place to achieve the goals across the region.

In 2023, the UAE launched its first commercial size plan to exploit low wind speeds. Other first wind farms are emerging in the Gulf region, including Kuwait’s Sagaya plant and Oman’s Harweel, as well as Saudi Arabia’s Dumat Al Jandal which generated electricity in 2021.

Biomass and geothermal energy offer additional opportunities for energy production, but their potential remains largely underexplored. Biomass resources alone, according to some estimates, could in fact offer between 6.3% to 22.5% of GCC current overall electricity consumption, according to studies, and conserve fossil fuel energy revenues for future investment purposes. The GCC is therefore developing biomass to turn food, agriculture and municipal waste into utilized energy generation. The UAE’s Dubai Waste Management Centre (DMWC), for example, is one of the largest waste-to-energy plants, helping the city achieve the goals of its Clean Energy Strategy by 2050. The UAE and its Consensus call for an orderly energy transition also led to the launch of the first geothermal project in the Gulf region in April 2023, after testing two geothermal wells in Masdar City in Abu Dhabi. 

COP29 and COP30 hydrogen and nuclear goals specifically target GCC positions as global clean energy powerhouses, with a focus on regional strategies to scale up low-emission blue and zero-emission green hydrogen production to baseline zero-emission hydrogen, and integrate nuclear energy into domestic grids. As a result, the GCC could be a leader in implementing NZE commitments if not entirely, but by rapidly advancing hydrogen energies.

Backed by rich sovereign wealth funds, the GCC economies in fact hope to add a “green niche” to hydrogen energy diversification plans, although the future of emerging renewable markets in the region and worldwide especially in the hydrogen industry is relatively uncertain mindful of heavy dependency on fossil fuels. To this end, new GCC renewable projects involve using green ammonia. It is made from hydrogen from water electrolysis by alternative energy. The GCC will also utilize blue ammonia from hydrocarbons where the CO2 is sequestrated via carbon capture utilization and storage (CCUS). Liquified ammonia could be an alternative to liquified natural gas (LNG), which is widely produced and exported across the GCC.

Most hydrogen currently produced in the world is grey, meaning that it uses fossil fuels without carbon capture. Saudi Arabia aims to turn into a regional hub for hydrogen production with carbon capture storage, as do the UAE and Oman. Qatar’s strategy focuses on large-scale low-carbon blue hydrogen, converted into blue ammonia by reforming its abundant natural gas reserves to capture and store carbon, through a US$1.2 billion investment in QatarEnergy and Qatar Fertiliser Company. Bahrain’s Sitra Clean Hydrogen Project supplies 20% of the refinery’s hydrogen through renewable-powered electrolysis, and by expanding solar and wind initiatives to feed future blue and green hydrogen production. The Kuwait Hydrogen Committee (KHC) is pursuing an ambitious strategy to develop blue and green hydrogen supply chain by 2050.

In May 2021, the Abu Dhabi National Oil Company (ADNOC) announced that it would advance a large-scale blue ammonia production facility to be a pioneer in the emerging hydrogen market. A major exporter of ammonia, Oman will be at the forefront of energy technologies for green transformation. Meanwhile, the first GCC hydrogen project emerged a long time ago, pointing that green hydrogen (produced by splitting water into hydrogen and oxygen using renewable electricity, with no CO2 emissions) had the highest potential for growth in wider spaces offered by Saudi Arabia, Oman, Kuwait and the UAE, and that blue hydrogen production (bringing together natural gas and heated water in the form of steam, along with CO2 emissions) could take place readily in all GCC states except for Bahrain, due to abundant natural gas. Hydrogen converted from crude oil production in the GCC, meanwhile, offers short term option for energy diversification, while hydrogen from natural gas is a short to medium term strategy.

The UAE’s nuclear energy will meet almost a quarter of the country’s future electricity needs. Other GCC states are developing nuclear power to meet the energy demands of a rising population. To this end, the GCC and the International Atomic Energy Agency carry out projects to build training centers for GCC nationals to work on using nuclear energy for electricity.

In the process, Saudi Arabia is actively advancing plans to build up commercial nuclear reactors. Oman is evaluating the option to build commercial nuclear capabilities. The UAE Barakah Nuclear Energy Plant is one of the first in the region to be fully operational. Qatar’s electricity generates exclusively from natural gas but it has evaluated the use of Small Modular Reactors (SMRs) for powering desalination and digital infrastructure though it halted nuclear projects that were to materialize by 2036. Kuwait produces zero nuclear electricity despite early proposals in 2010 to build commercial nuclear capability through the Kuwait National Nuclear Energy Committee (KNNEC). Bahrain has 0 GW commercial nuclear capacity, and it depends entirely on natural gas, but is actively making plans to use SMRs by 2030.

Challenges Facing GCC Renewable Goals

Future success will depend on the GCC’s ability to diversify its economy and absorb workforce into renewable markets, in order to better adapt to climate risks due to fossil fuel emissions without eliminating those fuels. This path sustains stable economic growth which in turn can help fund renewables worldwide. The challenge here, however, is that although the will to promote renewable policies is strong in the region, rich hydrocarbon resources delay the generation of alternative revenue sources for energy that are less economically viable.

According to the IEA, investments in renewables was $600 billion globally in 2022. Other IEA global estimates showed that renewable energy investment reached a high of $1.7 trillion that year, with a large portion coming from the private sector. The GCC reiterated its commitment to this green growth at COP28 through the Arab Coordination Group, an alliance of regional and international development institutions that offered to allocate US$10 billion until 2030. This is in addition to an earlier US$24 billion pledge by the group to support green transformation initiatives including in renewables.

High global borrowing costs due to economic downturns, however, have some investors retreating from renewable markets to generate electricity. There are also delays connecting and balancing grids with seasonal energy input in peak or other low demand times, and heavy bureaucracy to receive permits for it, which could in turn discourage GCC connectivity with global renewable markets and projects.

But with costs for renewables dropping overall as new and efficient technologies emerge, including electricity from solar falling by 87% and the cost of battery storage by 85%, renewable energy sources are expected to grow. This means that the renewable industries will also face a global shortage of some seven million skilled workers which the GCC countries could help train and provide.

The GCC countries’ energy pricing reforms over the past decade has also led to a drop in their subsidies for fossil fuels which could then release needed financial resources to meet diversification and renewable goals for energy generation while lowering the cost of climate adaptation and resilience. The GCC Interconnection Authority, meanwhile, is working on connecting electricity exchanges in the region, to encourage electricity trade. Even so, because countries like China and Brazil are set to exceed national targets for renewables, while there is still a need for a projected $1.2 trillion annual investments in renewables by 2030, expected fundraising crashes could emerge globally and discourage GCC investments although the region’s network connectivity will gradually expand and enable it to emerge as a sustained source for renewable investing.

Yet it remains to be seen if GCC renewable projects reach sustainable commercial scale or significant quantities to act as a transition fuel away from fossil fuels. For example, scaling up green or blue hydrogen is a debatable process worldwide, especially at high carbon capture rates. As new GCC plans emerge to make renewable energy the future, in reality, it is even clear that wind and solar farms have yet to reach commercial scales of a viable nature across the region.

In fact, the outlook for renewable energy in the GCC, along with ambitious policies involve complex national plans to achieve efficient green goals, mindful of capacity building challenges and under-investments. Although LNG shortfalls as well as climate factors will demand renewables, these plans for renewables should therefore set realistic goals and include good governance. Simultaneously, reforms should be made to overhaul the fossil fuel subsidization programs in order to better finance renewables, which in turn calls for collective action and policies across the region with the possibility to duplicate best practices. Such practices could then be capitalized through a well-coordinated region-wide approach that also advances the national green development goals for each GCC member state.

The UAE and Saudi Arabia are strong in financing skill sets for producing renewables, and they have rapidly acquired the technical and business knowledge to promote renewables. This means that they could take the lead in establishing new region-wide policies in renewables for the GCC. Meanwhile, solar industry is standardized across the GCC region through straightforward regulations, and it constitutes for example an essential part of Qatar’s climate strategy. Wind-turbine energy, however, is partly subject to national standards first and foremost, that could then delay regional investments. Not surprisingly, while plans are underway to make solar a future source, wind energy projects on a commercial scale are developing slowly in GCC states. Additional investors and risk assessment plans may also be required to help unify different sectors of such emerging renewable technologies, while major subsidies continue to feed the fossil fuel industries.

The GCC is also expanding renewable projects abroad as a cost-effective and cost competitive procurement tool to help achieve NZE goals globally, while investments in renewables in the region are expected to rise as well. Saudi Arabia and the UAE, for example will co-finance renewable projects with the State Oil Company of Azerbaijan in the Nakhchivan Autonomous Republic of Azerbaijan. The UAE-based Masdar also known as the Future Energy Company is a major contributor to the renewable energy sector in the GCC and beyond, and the region also invests in Middle East and North Africa markets which have received $1.4 billion from the GCC states to boost renewables and climate adaptability.

Meanwhile, the UAE currently accounts for more than 60% of the GCC region’s total renewables capacity, and close to 70% of investments in the field in 2013-2022, meaning that renewables constitute a small segment of the GCC power mix. There are other challenges ahead, including better renewable standardization policies at national and regional levels, market scaling for renewables, leasing plans for renewable infrastructure, financing, and replication challenges across the region to duplicate best practices. But heavy GCC investments including from financially high profile countries such as Saudi Arabia, and entities such as the King Abdullah University of Science and Technology Innovation Fund, as well as from Saudi Aramco’s Sustainability Fund, the Qatar Foundation and the country’s Research, Development and Innovation Council, not to mention Masdar’s Research and Development facilities in the UAE, will ensure that the GCC plays a major role in future emissions policies locally and worldwide.

Ultimately, success to meet NZE goals in the GCC states depends on ensuring steady investments in renewables to enhance infrastructures, promote hydrogen exports as well as biomass and geothermal solutions, create smarter grids for smoother distribution purposes while lowering currency fluctuation risks, increase bidders, engage international and local banks, and finance small-scale and larger projects involving flexible mechanisms in the form of green bonds (for example in the form of long-term non-bank capital which stood at $545 billion in 2021). Needless to say, improving regulatory tools and technologies to reduce costs and improve performance is essential to create sustainable and competitive renewable energy supply chains especially as the GCC states continue to merge fossil fuel feedstock into existing climate ventures.

Conclusion

Making a clean energy commitment in the GCC will require more than investing in renewables. The GCC states need to gradually shift their economies away from dependence on fossil fuels by diversifying into renewable energy markets. COP28 reinforced commitments to future renewable energy plans along these lines and advanced efforts toward reducing reliance on fossil fuels. COP30 did not mention a phase-out of fossil fuels, but the option to start the process of expanding renewables is a roadmap for implementing the orderly and equitable transition away from those fuels that energy-rich GCC states seek.

The GCC, alongside other major energy producers, will continue to contribute to global carbon dioxide emissions from fossil fuels. This means that NZE goals remain challenging to achieve in the near term, both in the GCC states and globally, and that stronger governance and regulation tools will need to emerge from within the region to enable it to lead the renewable industry drive. The GCC has meanwhile made important strides since COP26 in 2021, when some member states expressed concerns over the pace and structure of energy transition targets, and has become an influential bloc in achieving global renewable targets since COP29. It has since also shown that it is keen to restructure its energy markets in favor of renewables and emerge as a leader in this emerging industry, while driving its economies toward greater energy diversification.