The National Bank of Abu Dhabi (NBAD) has committed to provide $10bn in financing for the development of clean energy energy projects over the next 10 years.
The proposed funding would be used for environmentally sustainable activities, in a bid to help meet increasing energy demand across the globe over the next 20 years which will partly be met using renewable sources.
NBAD discovered that a funding gap of $48 trillion must be met over the next two decades to meet the global energy demand.
The bank’s’ Financing the Future of Energy Report’ identified that there is a large and projected gap between supply and demand for energy in the Gulf, especially in the form of electricity.
The funding will be available for projects that generate energy, transmit and distribute energy to consumers, in addition to improving the efficiency of energy use.
During its research, NBAD identified the need for nearly $640m in investment towards renewable energy projects across the West-East Corridor.
However, the bank said that the scope of sustainable business includes activities like clean transportation, sustainable water, waste management and energy efficient real estate, in addition to clean energy projects.
NBAD CEO Alex Thursby said: "The world is heading towards a very significant funding gap for energy globally. This is particularly true across the West-East Corridor, the rapidly growing super-region that stretches from Africa through the Middle East to Asia – and filling it is going to be a big task. As the leading bank in the Middle East, we want to make a real contribution to the region’s ability to rise to the energy challenge.
"We believe that even in the current climate of low oil prices, the transition towards more renewable sources in the energy mix will continue because the underlying drivers are long term and strong. It is for this reason that we have made this commitment of US$10bn today. Through our Sustainable Business team we hope to become a positive force in the banking sector in the region, accelerating the transition to a much needed new world of energy."
Image: National Bank of Abu Dhabi, UAE. Photo: courtesy of Ijanderson977.