Circular carbon economy holds promise in battle against global warming

Saudi Arabia has embraced the circular carbon economy (CCE) enthusiastically, and is now playing a leading role in advancing a strategic plan to tackle one of the most serious issues the world faces today — the existential threat from climate change. (AFP/File Photo)
Short Url
Updated 26 July 2020
Follow

Circular carbon economy holds promise in battle against global warming

  • Tech-neutral approach forms key part of KSA’s strategic plan to achieve sustainable development goals
  • CCE offers a potential path to slow down and even reverse the inexorable process of global warming

DUBAI: “Carbon is not the enemy,” said Prince Abdul Aziz bin Salman, Saudi Arabia’s energy minister, when he laid out the foundations of the strategy that the Kingdom believes can halt the planet’s apparently inexorable slide toward climate catastrophe.

Saudi Arabia cannot be credited with inventing the idea of the circular carbon economy (CCE), which grew out of a body of work by environmentally conscious economists and thinkers over the past few decades.

But the Kingdom has embraced the concept enthusiastically, and is now playing a leading role in advancing a strategic plan to tackle one of the most serious issues the world faces today — the existential threat from climate change — even as it wrestles with the immediate challenge of the COVID-19 pandemic.

Last year, at the Future Investment Initiative forum in Riyadh, Prince Abdul Aziz said: “Considering our pivotal role as a global energy producer, it is our responsibility to find a solution through innovation and collaboration to create a sustainable framework for growth.”

Since then, CCE has become a central plank of the Kingdom’s long-term energy thinking, embedded in policies and proposals from the think tanks of the G20 leaders’ organization as it prepares for the global summit in November, as well as in practical projects and initiatives by Saudi Aramco, the Kingdom’s energy giant, and other big mega-projects of the Vision 2030 reform strategy, such as Neom.

In essence, CCE is a masterplan to slow down and even, hopefully, reverse the apparently inexorable global warming caused by the emission of carbon materials into the atmosphere, identified by scientists as the main factor behind climate change.

CCE aims to help the world meet the targets set by the 2015 Paris Agreement on climate, to keep the rise in global temperatures to 2 degrees above pre-industrial levels, and even cut to 1.5 degrees, by reducing emissions from the carbon products that create harmful “greenhouse gases.”

It plans to do this by developing a “closed loop” system that effectively mimics nature’s own cycles, enhancing and augmenting the process by which harmful carbon materials are neutralized.

Adam Sieminski, president of the King Abdullah Petroleum Studies and Research Center (KAPSARC) in Riyadh, told Arab News: “The CCE is a holistic approach to carbon management that can guide international efforts toward a more inclusive, resilient, sustainable, and carbon‐neutral or net‐zero energy system.”

The term “net zero” is key here. Some radical environmental activists want the world to commit to “absolute zero” on carbon emissions. But the Saudi approach to CCE — as you would expect from the world’s leading oil producer — is to continue to exploit the undoubted benefits from carbon as a source of energy, while attempting to minimize the harmful side-effects.

FASTFACT

Circular Carbon Economy

CCE employs a technology-neutral approach to achieve energy market stability and responsible economic growth.

KAPSARC research distinguishes between different types of carbon within the economic process. “Living carbon” is a positively beneficial phenomenon, essential to human life and the process by which we have fresh foods, healthy forests, and fertile soil.

More problematic are “durable carbon” — where it is locked in stable solids such as fibers and plastics — and “fugitive carbon” which consists of gases like carbon dioxide and methane that are released into the environment by energy generation, transportation, and industrial cycles.

Core to the problem of dealing with the carbon situation are the “three Rs” — to reduce, reuse, and recycle carbon products that can pollute the world’s environment. These ideas are increasingly familiar to consumers the world over, in calls or more awareness of the use of plastic products, through the development of clean electric vehicles, right down to the bags at the supermarket checkout.

Saudi Arabia already has in place various programs that address these issues. There has been an energy efficiency program in place for nearly a decade, designed to help industry, transportation, and buildings optimize their use of energy. Phasing out of energy subsidies is also a crucial part of that plan.

The Kingdom also has well-developed and ambitious programs for renewable energy sources, such as wind and solar, as well as a strategy for civil nuclear power generation that is being steadily implemented, in accordance with international atomic power standards.

But on their own, the 3 Rs are unlikely to help the world meet the targets of the Paris Agreement. Saudi Arabia has emphasized a fourth R — remove — which is an altogether more ambitious proposition.

Energy expert Christof Ruehl, senior research fellow at the Center on Global Energy Policy at New York’s Columbia University, told Arab News: “The first three Rs are good general principles, but the fourth R, remove, is a significant technological and commercial challenge.”

Removing carbon via technology involves a process known as carbon capture, utilization, and storage (CCUS) which is a complicated and expensive business.

Another energy expert agreed that implementing CCUS was an essential but challenging goal.

Robin Mills, chief executive of consultancy Qamar Energy, said: “The technologies for reusing carbon are limited in scale, costly and/or technologically immature. However, a major scale-up of carbon capture, carbon use or storage, and direct capture from the air, are all essential parts of decarbonizing the Saudi economy in the longer term and keeping its fossil-fuel resources viable.”

Opinion

This section contains relevant reference points, placed in (Opinion field)

The Kingdom already operates the largest CCUS plant in the world. Neom, the gigantic mega-city being planned in the north east of the Kingdom, has declared it will be the world’s biggest carbon-free hub, and is working on plans for environmentally friendly water desalination in addition to a big program of renewables and the use of “green hydrogen” as fuel.

Saudi Aramco, which is one of the leading global investors in clean energy techniques, is working actively on developing processes in its oil drilling, refining, and transportation.

It already uses carbon-capture technology to extract CO2 from the industrial process, employing it to maintain pressure in oil reservoirs and for enhanced oil recovery.

Aramco crude is recognized as among the cleanest in the world thanks to low carbon intensity and efficient refining processes, in comparison with its international peer group.

Industrial and technological developments such as these will contribute to reducing emissions of greenhouse gases and slowing the pace of global warming. But, the experts agree, there will also have to be a serious effort to reduce use of carbon fuels if the Paris Agreements are to be met.




This picture taken on December 11, 2019 shows a view of Jubail Desalination Plant at the Jubail Industrial City, about 95 kilometers north of Dammam in Saudi Arabia's eastern province overlooking the Gulf. (AFP)

Ruehl said: “There are technologies out there, but none works on the scale necessary to make a serious dent in global levels of emissions. So, you need a means — either via regulation, tax, or a market mechanism — that incentivizes carbon emitters to reduce their output. But this has proved to be very difficult to organize on a global level.”

The European authorities tried to put in place a carbon-trading system that would allow industrial producers to buy and sell the right to produce carbon, but it fell victim to market manipulation and corruption. Other schemes suffered similar challenges.

Prince Abdul Aziz said recently that Saudi Arabia would soon announce its own carbon-trading strategy to address these vulnerabilities, stressing the commercial benefits of such a plan.

“Carbon is a resource. It is not something that we should just throw and just emit it. Actually, capturing it lets us make money out of it,” he said.

Such a project would bring its own advantages, Ruehl agreed. “For KSA, which is a comparatively ‘clean’ oil producer, it would be a competitive advantage over other oil producers if an effective carbon market could be set up,” he said.

Carbon is not an enemy. But it will take a lot of ingenuity and global co-operation to turn it into a committed ally. The hope must be that the experience hard won during the pandemic will help forge that collaboration once the virus is conquered.

-------------------------

Twitter: @frankanedubai

 


Riyadh Air and Saudia agree new joint training programs

Updated 12 sec ago
Follow

Riyadh Air and Saudia agree new joint training programs

RIYADH: Saudi Arabia’s two national airlines will work together to train pilots, aircraft crews and other aviation employees thanks to a new deal.

Riyadh Air, the airline announced by Crown Prince Mohammed bin Salman in March 2023, has reached an agreement with the Saudi Academy – affiliated with the Saudia group, the national carrier of the Kingdom.

The memorandum of cooperation, signed at the Future Aviation Forum in Riyadh, represents a turning point in specialized education in the field of aviation for Saudi Arabia’s national carriers, paving the way towards improving the training standards of pilots, aircraft crews and air operations, according to the Saudi Press Agency.

The agreement will enable the two national carriers to integrate their expertise and resources to provide training programs covering a wide range of specializations, SPA’s report added.

These programs will include technical training, aviation basics, and ground operations, as well as management principles, linguistic proficiency, and compliance with regulatory provisions and standards.


Pakistan GDP grows 2.09% in Q3, supported by agriculture

Updated 10 min 56 sec ago
Follow

Pakistan GDP grows 2.09% in Q3, supported by agriculture

  • Pakistan’s central bank in latest report projected real GDP growth of 2-3% for the fiscal year 2024 
  • Provisional 2024 financial year growth in agriculture estimated at 6.25%, 1.21% for industry and services

ISLAMABAD: Pakistan’s economy grew 2.09% in the third quarter of the financial year 2023-2024, supported by higher growth in agriculture, the Pakistan Bureau of Statistics said in a press release on Tuesday.

The estimated provisional growth rate of gross domestic product (GDP) for the financial year ending June 2024 is 2.38%, the bureau said in a statement. That compares with a revised 0.21% economic contraction in the 2023 year when political unrest, a combination of tax and gas tariff hikes, controlled imports, and a steep fall in the rupee currency rapidly pushed up inflation.

Last week in its half yearly report, Pakistan’s central bank projected real GDP growth of 2-3% for the fiscal year 2024.

There was no comparable year-ago third quarter GDP data as Pakistan only began releasing quarterly growth numbers from November. That was done in compliance with the structural benchmarks of the current $3 billion bailout program agreed with the International Monetary Fund and completed last month.

The bureau revised the first and second quarter GDP estimates for financial year 2023-2024 to 2.71% and 1.79% respectively, compared to earlier estimates of 2.5% and 1%.

The provisional 2024 financial year growth in agriculture was estimated at 6.25%, and 1.21% for both industry as well as services, it added.

“The healthy growth of agriculture is mainly due to double-digit growth in important crops,” the bureau said, adding that bumper crop of wheat, cotton, and rice contributed to the positive result.


IMF expects UAE’s economy to grow by 4% in 2024

Updated 12 min 31 sec ago
Follow

IMF expects UAE’s economy to grow by 4% in 2024

RIYADH: The UAE’s gross domestic product is set to expand by 4 percent this year, driven by robust domestic activities and relatively high oil prices, an International Monetary Fund has forecast.

In its latest Article IV end of mission statement, the IMF noted that the Emirates is experiencing strong growth in domestic sectors, including tourism, construction, and financial services. 

The report further noted that UAE’s oil GDP will also expand this year if the Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+, decide to ease the previously proposed output cuts. 

“Economic growth in the UAE is broad-based, led by robust activity in the tourism, construction, manufacturing, and financial services sectors. Foreign demand for real estate, increased bilateral and multilateral ties, and the UAE’s safe haven status continue to drive rapid growth in housing prices and an increase in rents while adding to ample domestic liquidity,” said the IMF in the statement. 

In its previous projection in April, the organization predicted that the UAE’s economy would grow by 3.5 percent in 2024. 

The UN financial agency added that the impact of geopolitical tensions in the Emirates so far is still minimal, and the country’s response to the recent flooding was rapid and effective. 

IMF further pointed out that the inflation rate in the UAE is expected to be contained at 2 percent in 2024. 

According to the study, the UAE’s fiscal and external surpluses are expected to remain high this year due to relatively surging oil prices. 

“The general government surplus is projected to be around 5 percent of GDP in 2024 and public debt is on track to decline further toward 30 percent of GDP, benefitting from active debt management strategies,” said IMF. 

It added: “Capital spending is expected to meet ongoing infrastructure needs, and the introduction of the corporate income tax will support non-hydrocarbon revenue with its full implementation in the coming years. The current account surplus is projected at around 9 percent of GDP in 2024.” 

The international financial institution also noted that accelerated public and private investment and structural reforms in areas like renewable energy and technology could further accelerate economic growth in the Emirates. 

However, the IMF noted that the UAE’s economic outlook is subject to uncertainty and external risks, including those related to geopolitical tensions, global growth, and commodity price volatility. 

The study highlighted that banks in the Emirates have considerable capital and liquidity buffers, while credit growth is resilient despite higher domestic interest rates. 

“The efforts to digitalize the financial system and payment landscape are welcome and should continue to follow a risk-conscious approach. Initiatives to develop and regulate the virtual asset industry should be informed by a careful assessment of macroeconomic and financial stability risks,” said the IMF. 

The report concluded by saying that gradual fiscal consolidation and further structural reforms will ensure the UAE’s economic prudence and medium-term sustainability. 


Saudi Power Procurement Co. signs two power purchase agreements with Japan’s Marubeni

Updated 20 min 36 sec ago
Follow

Saudi Power Procurement Co. signs two power purchase agreements with Japan’s Marubeni

TOKYO: The Saudi Power Procurement Co. signed two power purchase agreements with a consortium led by Japan’s Marubeni Corporation on Tuesday in Tokyo. 

The deals are part of the fourth phase of Saudi Arabia’s National Renewable Energy Program, supervised by the Ministry of Energy. 

Prince Abdulaziz bin Salman Al Saud, Saudi Minister of Energy and Japan’s Minister of Economy, Trade and Industry SAITO Ken were present at the signing. 

The agreements pertain to the Al-Ghat wind power project, with a capacity of 600 MW, and the Waad Al-Shamal wind power project, with a capacity of 500 MW. These agreements were signed during the Saudi-Japan Vision 2030 Business Forum, held in Japan on Tuesday. 

On this occasion, Prince Abdulaziz bin Salman Al Saud, Saudi Minister of Energy, expressed his gratitude to King Salman bin Abdulaziz Al Saud, and to Crown Prince Mohammed bin Salman bin Abdulaziz Al Saud, Chairman of the Supreme Committee for Energy, for the support, assistance and follow-up provided by the leadership, which aids the Ministry of Energy and its system in achieving the goals of Saudi Vision 2030 in the energy sector. 

Prince Abdulaziz stated: “I am pleased to announce that the Al-Ghat project has set a new world record for the lowest cost of electricity production from wind energy, with a cost of 1.56558 US cents per kilowatt-hour, equivalent to 5.87094 halalas per kilowatt-hour. The Waad Al-Shamal project achieved the second-best global record in this field, with a cost of 1.70187 US cents per kilowatt-hour, equivalent to 6.38201 halalas per kilowatt-hour.” 

The minister added: “The annual energy produced by both projects will be sufficient for the consumption of 257,000 residential units, demonstrating the significant success of these projects in enhancing energy efficiency in the Kingdom.” 

He noted that these projects are part of the objectives of the National Renewable Energy Program, which aims to utilize renewable energy sources available throughout the Kingdom to contribute to displacing liquid fuels used in the electricity production sector and achieving the optimal energy mix for electricity generation, with renewable energy sources expected to account for about 50% of the mix by 2030.


Saudi crude exports reach 9-month high: JODI

Updated 21 May 2024
Follow

Saudi crude exports reach 9-month high: JODI

RIYADH: Saudi Arabia’s crude exports reached 6.41 million barrels per day in March, according to an analysis from the Joint Organizations Data Initiative.

This figure increased by 96,000 bpd, or 1.52 percent, compared to the previous month, marking a nine-month high.

Furthermore, the data indicated that the Kingdom’s crude production fell to 8.97 million bpd, reflecting a monthly decrease of 0.42 percent. 

This can be linked to the voluntary oil production cuts adopted by members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+. Saudi Arabia announced in March the extension of its 1 million bpd cut, initially implemented in July 2023, until the end of the second quarter of 2024.

The Ministry of Energy said that the Kingdom’s production will be approximately 9 million bpd until the end of June.

Meanwhile, refinery crude output, representing the processed volume of crude oil yielding gasoline, diesel, jet fuel, and heating oil, fell by 4 percent compared to the previous month, reaching 2.56 million bpd, according to JODI data.

Saudi Arabia’s direct burn of crude oil, which involves using oil without substantial refining processes, decreased by 53,000 bpd in March, representing a 14.7 percent fall compared to the preceding month. The total direct burn for the month amounted to 307,000 bpd.

The Ministry of Energy aims to enhance the contributions of natural gas and renewable sources as part of the Kingdom’s goal to achieve an optimal, highly efficient, and cost-effective energy mix.

This involves replacing liquid fuel with natural gas and integrating renewables to constitute approximately 50 percent of the electricity production energy mix by 2030.