Why should the GCC consider investing in alternative energy? The Gulf nations have enough energy of their own for the foreseeable future, so why dismantle a lucrative and historic revenue stream?
There are, however, three powerful reasons why we should not ignore the current interest in alternative energy.
First, there are the investment opportunities, and last month’s launch of Standard & Poor’s alternative energy index — in which 50 companies from 13 countries with a combined market capitalization of $512.5 billion are represented — is the latest indicator of this potential. Secondly, there is climate change. Traditional energy producers cannot ignore the obvious and by now globally-accepted evidence that our world is changing — heating up and melting down — due to man’s over-reliance on fossil fuels. Thirdly, there are security concerns. The Middle East cannot escape the fact that it is a region with many energy eggs in one creaky and volatile basket. There is every reason to diversify while this low-intensity tension continues to simmer (especially as it looks as if Iran has only got one kind of alternative energy on its mind).
Unlike the technology boom, this is one boat the Arabs cannot afford to miss and it would be fitting that a region so synonymous with energy and wealth should use some of this wealth to lead the way in developing new, safe and responsible ways to power our earth. Then surely the shining new emirates could genuinely take their place at the developed world’s high table.
But they should not drag their heels. In the same way that Silicon Valley led the way for a technological generation, there is a new breed of US-funded research into alternative energy. President George Bush, hardly the greenest leader on Earth, has gone to Brazil three times in to discuss ethanol exports with President De Silva; and this from a man who normally only gets out of bed for Iraq, church and the future of the GOP.
Yes, there will always be resistance — oil producers and the world’s automobile manufacturers are the obvious grumblers as they have most to lose with the incursion of high additional costs required to incorporate newer and cleaner ways to do business. Speaking recently at the American University of Beirut, Nissan and Renault chief, Carlos Ghosn, no doubt wary of who butters his bread, reminded us that in a global industry which sells 65 million cars annually, it is hardly sound business practice to focus on the 300,000 hybrids assembled each year.
Then again, he, too, probably had no alternative.