Is net-zero a reality in the Middle East?

Nicholas Kramer, Angela Croker and Rekha Ajoodha from law firm Norton Rose Fulbright look at the possibilities for the energy transition in the Middle East On 12 December 2015, global leaders of 196 countries congregated at COP 21 in Paris to negotiate and resolve the world’s first legally binding treaty on climate change (the Paris Agreement), which sets a goal to limit global warming to well below 2°C, preferably to 1.5°C, compared to pre-industrial levels. Underpinning this goal is the energy transition, aptly defined by S&P as ‘a transformation of the global energy sector from fossil-based systems of energy production to renewable energy sources’ aimed at reducing energy-related greenhouse gas emissions (including CO2) in order to limit the increase of global temperature. The switch to lower and/or zero carbon based technologies, the acceleration of carbon capture and energy storage technology, the establishment of carbon markets, the use of carbon offsets and the boom in sustainable finance availability are all key drivers in this transition. THE ENERGY LANDSCAPE IN THE GCC AND BEYOND The Paris Agreement works on a ‘ratchet mechanism’ requiring each party...