The United Nations Conference on Climate Change scheduled to be held in Paris in December 2015 will aim to reach a new agreement between the States involved in the negotiation process in order to limit greenhouse gases emissions and the rise in temperatures. Beyond the sole environmental concern, the conclusion of this agreement is underpinned by the energy transition issue, which arises with ever greater insistence facing the depletion of hydrocarbon resources.


University of California researchers estimate that the 1.332 trillion crude oil barrels of reserves may be depleted by the year 2041. In this perspective, all countries will have to make a change in their “energy software”, but this problem is even more acute for oil and hydrocarbon producers as energy is also their main source of wealth and sometimes the core of their economy.


Recognizing this, States, local authorities and investors around the world support many initiatives in favor of renewable energy, reflecting the will to take this necessary step towards an effective transition.


A multi-speed Europe


Historically, awareness of European countries grew regarding this matter have grown at different paces and according to political changes, with considerable advance on the Nordic side (for instance the exploitation of geothermal energy) or even Germany with its objective of complete abandonment of nuclear energy by the year 2022.


Initiatives for the fight against climate change and for the development of renewable energy take many forms: research grants, incentives or disincentives tax, regulatory measures, eco-neighborhoods financing, setting up of experimental labs and working groups on the subject, etc. Among these initiatives involving private and public actors, we can also take the example of the European association “Energy Cities”, created 25 years ago, that inspired many other similar initiatives worldwide. Its French president, Claire Roumet emphasizes the experience of her association in accompanying the energy transition at a local level, with the aim of involving all stakeholders in an integrated dynamic program.


In any case, today, at all levels, European countries within the European Union integrate environmental issues in all their public policies, and they stand at the forefront of the negotiations in view of the COP21.


A global momentum


Many cities around the world promote their commitment to renewable energy, and it is not the sole prerogative of Europe. Toronto Mayor Gregor Robertson, for example, stated that he wanted to rely only on renewable energy for his city by 2020. The large States are mobilized as well and today they all have a green agenda: China itself recently became the first investor in green energy, with no less than $ 89.5 billion invested last year. “This strong investment in clean energy (in 2014) will surprise observers who foresaw the turmoil in renewable due to the fall in oil prices since the summer” says Michael Liebreich, chairman of New Energy Bloomberg Finance. A proof that the sense of emergency is now integrated by all stakeholders at all levels of action.


Oil-producing countries, aware of the risk


Beyond environmental issues, oil-producing countries are, without a doubt, the most affected by this issue of energy transition today, since their economy relies on the exploitation of finite resources. They are also often the first consumers as they have a privileged access to it. The Saudi Minister for Petroleum and Mineral resources, Ali Al-Naimi, well aware of this reality, stated last May at the Business and Climate Summit in Paris: “One day the world will no longer need hydrocarbons. I do not know when it will happen, probably in 2040, in 2050 or later (…). Greenhouse gas emissions and global warming are among humanity’s most pressing concerns. (…) Societal expectations on climate change are real, and our industry is expected to take a leadership role. We are doing this in Saudi Arabia. ”


Energy cities, integrated energy business districts: initiatives promoted by visionary investors like EsamJanahi.


Several projects are already underway or firmly anchored in the gulf and the Middle-East region, promoted by local investors who see in the energy transition a real opportunity. In Qatar, for example, the Energy City Qatar project, launched by EsamJanahi, proposes to pool companies and skills in a same district to better anticipate the hydrocarbon and renewable energy sectors in Qatar. Initiatives of this kind flourish all over the region, but also in the Mediterranean and in Asia, for example through the project of an integrated energy business district in Mumbai, also promoted by EsamJanahi. Other examples are easy to find: The Sultanate of Oman recently hosted a forum organized by the World Bank to talk about the role of clean energy in the context of economic performance and competitiveness. New programs and partnerships are also being developed with the Sultanate as well as with the United Arab Emirates and Kuwait.


In spite of the recent decrease in oil prices, all these initiatives are proof that the pressure to initiate a real energy transition is increasing. In view of the COP21 negotiations, French Foreign Minister Laurent Fabius defined the subject of financing as decisive for the climate conference, thus stressing the key role to be played by private investors in this field: OECD countries might as well take a look at what’s happening in the oil-producing countries to take their inspiration.