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(Bloomberg) — The United Arab Emirates is pushing for a global pledge to triple renewable energy deployment by the end of the decade as world leaders gather in Dubai for COP28, the year’s largest climate conference. It will also showcase its investments in solar and wind energy.
But a closer look at the numbers reveals that the UAE’s homegrown renewable energy champion is not the juggernaut it claims to be – at least not yet.
The UAE was one of the first major Middle East oil exporters to begin considering an end to fossil fuels. In 2006, it established Abu Dhabi Future Energy Company (Masdar), run by Sultan Al Jaber, now COP28 chairman. (He remains chairman and chief executive of Abu Dhabi’s national oil company Masdar.)
Masdar, which operates renewable energy projects in the United States, the United Kingdom and the United Arab Emirates, currently claims it has “more than 20 gigawatts of total clean energy capacity” and is “one of the largest renewable energy companies in the world.”
If its portfolio were indeed that large, Masdar would rank 11th on BloombergNEF’s ranking of companies with renewable energy projects. That would put it behind global players such as Spain’s Iberdrola SA and Italy’s Enel SpA.
But in fact, BNEF data shows Masdar’s portfolio is just over 3.8 gigawatts. That ranks it 62nd among global renewable energy companies, below India’s NTPC Ltd., which also owns one of the world’s largest coal-fired power plants.
To build the ranking system, BNEF tracks renewable assets and finance around the world. David Hostert, BNEF’s global head of economics and models, said it had been a “record keeper” for nearly 20 years. “This is the most complete data set in terms of breadth and depth of coverage.”
Most renewable energy projects in the world have multiple owners. Typically, a developer builds a solar or wind farm and then sells shares to investors. BNEF aggregates only the percentage ownership in projects to calculate a ranking of companies with the largest portfolios.
For example, the Al Dhafra solar power plant in the United Arab Emirates has a rated capacity of 2,101 MW. Masdar’s 20% stake means BNEF allocates 420.2 MW of net capacity to Masdar’s portfolio. BNEF noted that Masdar has 46 projects in 14 countries, with its equity holdings totaling 3,824 MW.
Masdar calculates the sum of its portfolio differently. It has chosen to use total capacity, meaning the Al Dhafra project counts as 2,101 MW in its total portfolio. Bloomberg Green adds up all the projects in Masdar’s portfolio based on this methodology on its website, which adds up to 10 gigawatts – about half of the company’s claimed capacity.
How to explain this difference? A Masdar spokesman said it includes all projects that are “operational, under construction or locked”.
But over the years, Bloomberg New Energy Finance has found that many projects announced by developers were never built or ended up being smaller in capacity. Therefore, it only uses operational capabilities to rank developers.
“There is no unified ranking system in this industry,” a Masdar spokesman said. “We are a world leader in geographic diversification, technology diversification and capacity.” The company did not disclose project details to make up for the 10 GW of projects on its website versus the 20 GW it claims across its entire portfolio. the gap between.
—With the help of Demetrios Pogkas.
©2023 Bloomberg
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