The United Arab Emirates (UAE), host of the COP28 climate conference that kicked off this week in Dubai, on Friday announced a $30 billion climate fund called ALTERRA that seeks to attract $250 billion in investment by 2030.
The UAE has not, however, offered any concessions to climate activists who want fossil fuels to be completely phased out on a similar timeline.
The ALTERRA fund was announced by UAE leader Sheikh Mohammed bin Zayed al-Nahyan (MBZ), who said the project was a joint effort with international asset managers BlackRock, Brookfield, and TPG.
MBZ said the fund is intended to “steer private markets towards climate investments and focus on transforming emerging markets and developing economies.”
“The lack of readily available and affordable climate finance has long been one of the biggest obstacles in advancing climate action globally,” he said.
The general idea is that by placing big bets on those markets today, the UAE and its partners can alleviate the perception of high risk that keeps many investors at bay.
“The opportunities in the under-served part of the world need much more attention,” BlackRock CEO Larry Fink said at the rollout press conference for ALTERRA.
The new fund was created by a new investment management firm called Lunate, which happens to be part of the vast business empire managed by UAE national security adviser Sheikh Tahnoon bin Zayed al-Nayhan, MBZ’s brother.
“The plan, announced Friday at opening proceedings of the annual U.N. Climate Change Conference, which the UAE is hosting this year in Dubai, comes as the petrostate tries to burnish its credentials as a leader in the clean energy transition, even as it continues the oil investments that have brought Emiratis tremendous wealth,” the Washington Post observed.
“The money to fund the projects will come largely from oil revenue,” the Washington Post added.
That may be a difficult pill for the climate change movement to swallow. COP28 is already controversial among them because the host is Sultan Ahmed Al Jaber, head of the Emirati national oil company.
Al Jaber claims he is sincerely interested in environmental issues and wants the oil industry to improve its environmental footprint, but some climate activists dismiss him as the greenwasher-in-chief, the world’s leading example of a dirty industrialist who thinks he can purchase indulgences from the green movement.
The most cynical among the climate faithful think Al Jaber is hosting COP28 so he can sabotage climate change efforts. Even as the UAE lays out eye-popping sums for renewable energy development, critics question how enthusiastic the Emiratis truly are to sponsor industries that would cut deeply into the petroleum sales that made them wealthy.
On Monday, just as COP28 was getting underway, the BBC published a report based on leaked documents that ostensibly showed Al Jaber planning to “strike oil and gas deals” behind the scenes of the climate conference.
The UAE did not exactly deny the report, instead responding that “private meetings are private,” and insisting it plans to continue funding “meaningful climate action” while it sells vast quantities of oil.
“This country is trying to figure out its role in a changing planet. It doesn’t yet know what its future looks like in a low emissions world. The country is still experimenting, and I don’t think it knows which of these experiments will work,” David Victor of the University of San Diego’s Deep Decarbonization Initiative told the Washington Post, offering a relatively charitable bit of skepticism.
On Friday, a somewhat less charitable U.N. Secretary-General Antonio Guterres slapped back at Al Jaber for saying fossil fuels would be part of the world’s economy for years to come.
“We cannot save a burning planet with a fire hose full of fossil fuels,” Guterres declared.
“The 1.5-degree limit is only possible if we ultimately stop burning all fossil fuels. Not reduce. Not abate,” he insisted, referring to the temperature goals envisioned by the Paris Accords.
COP28 also saw a seeming divergence of opinion between King Charles II of Britain, who called for maximalist progress on climate goals, and the government of Prime Minister Rishi Sunak, who is rolling back some of the more severe climate restrictions.