I'm Brad Smith, and this is Tools and Weapons. On this podcast, I'm sharing conversations with leaders who are at the intersection of the promise and the peril of the digital age. We'll explore technology's role in the world as we look for new solutions for society's biggest challenges.
I think they're interdependent. I don't think they can ever be separated. And I do believe that by integrating AI and energy, we can unlock economic and social value.
That's His Excellency Dr. Sultan Al Jaber, of the United Arab Emirates or UAE. Dr. Sultan is the CEO and Managing Director of the Abu Dhabi National Oil Company, or ADNOC. He's also the founding CEO and Chairman of Masdar, the world's largest investor in renewable energy, and he was the president of COP28, last year's global UN Conference on Climate Change. If you're thinking the CEO of an oil company is an unlikely choice to lead global efforts to combat climate change, you're not alone. But it's his expertise in oil and renewable energy that positioned him so well as a uniquely qualified leader in the climate dialogue. In this episode, Dr. Sultan explains the critical role oil companies need to play in the transition to decarbonizing energy production. We discussed the relationship between AI and green energy, and how each at their best, propel the other forward. And how bold personal leadership in the face of skepticism, helped him bring people and industries together to form the UAE Consensus. Last year's landmark agreement negotiated at COP28 in Dubai, involved some of the largest commitments made to combat the climate crisis since the 2015 Paris Climate Accord itself.
To hear more conversations like this one, I invite you to follow or subscribe to the podcast, wherever you're listening now. My conversation with Dr. Sultan Al Jaber, up next, on Tools and Weapons.
Well, Dr. Sultan, thank you for joining me here, in Redmond, in Washington. You've been here for the CEO Summit that we hold every year, and this is an opportunity to share with the world, if you will, a little bit about what we're all talking about. And as is the case, I feel like everywhere, part of what we're talking about is the environment, the future of planet Earth, and you have played a unique role. Not only have you done such important work leading ADNOC, the Abu Dhabi National Oil Company, but I'd love to ask you a little bit about the two years that you spent working as the president of COP28, a COP that was in Dubai last December, one that people questioned, would it be successful, could it possibly lead to a breakthrough? And it did. This work that you did was not all new to you. You've been focused on the energy transition in particular, throughout so many parts of your career. Can you share with us a little bit about the challenge you took on when you took the leadership role at ADNOC itself? How did you think about what you needed to accomplish?
Well, first, thank you very much Brad, for inviting me to the Microsoft CEO Summit, and for giving me this opportunity to speak to you. Many people use the word innovation, but here, Microsoft, I can comfortably say that Microsoft truly defines the term and has really contributed to shaping the 21st century. I'm glad and excited to be given this opportunity and to be here with you, and with everyone else, participating at this very special event. To your question, the mandate I had in ADNOC was simply centered around three main areas. One, is to transform ADNOC and make it be the most advanced progressive global energy company. Second was, is to decarbonize ADNOC and help ADNOC be the least carbon-intensive energy producer, and the third objective of my mandate was, is to future-proof ADNOC through adopting best-in-class, most advanced low-carbon solutions and technology, including AI digitization across our operations, while also expanding our scope in ADNOC to cater for low-carbon solution investments, new technologies, renewable energy, as well as gas investments outside of our own borders. And what we have come across in our transformation journey in ADNOC, is the fact that AI can play an enablement role in helping achieve our mandate. It is important for everyone involved in the space to realize that AI is not only accelerating the change, but in fact, is changing the pace of change. If we take a step back, there are three mega trends that will shape the future of humanity over the next 10 years. One, is the transformative growth of AI. The second, is the way the energy transition is being translated. And the third, is the rise of emerging markets and the importance of including the global south. I think, if we integrate the AI and energy sectors more effectively, we can reduce emissions while we ensure sustainability and prosperity through driving social and economic value everywhere. In our view, globally, there are 1,600 large data centers that currently consume 400 terawatt hours of power. And we all know that this number will double by 2030, adding 700 terawatt hour in demand. That is the equivalent of the entire electricity consumption of Canada. Meeting this demand would require a huge amount of energy. For example, we will need not less than 20 to 25 nuclear reactors to be added, in the US only, to meet this growing demand, and we know that is not going to be an easy task to deliver. And of course, given the intermittency and storage challenges of renewables, we will need up to 200 bcm of gas, annually, to bridge the gap. And of course, we need AI to help the stabilization of the grids and the upgrade of such existing national networks, as well as the fact that we need to start thinking how do we integrate base load and intermittent power as part of our grids to help ensure the stability of our supplies. Our collective challenge is going to be centered around making this system also as close to net zero as possible. And we do believe that AI is a huge part of the answer. In fact, AI, in our view, is going to be a critical success factor in helping achieve that. Here, I'm going to add another point. While I fully appreciate that the discussion have been very much centered around our ability to meet that growing demand through generating more electrons, we need to start focusing on how do we generate more electrons by being efficient and by optimizing the current energy system before we start thinking of the new energy system. I promise you, saving electricity or electrons today, is going to be much cheaper, much faster and much easier. So it is our view that we need to start thinking, how do we make the current energy system as efficient and as optimized as possible while we continue to think how we build the new energy system that is low-carbon?
How do you think about the connection between AI and energy?
Well, I think they're interdependent. I don't think they can ever be separated. And I do believe that by integrating AI and energy, we can unlock economic and social value. AI is already impacting the demand side of the equation. AI can make grids smarter through predictive analytics and of course, more can be done on the supply side, with AI, to help integrate renewable energy and other energy sources. And we should of course, apply machine learning, energy management systems and digital twins to every energy intensive process. And in ADNOC, for example, we already do this, we are already applying AI and we have been able to reduce our emissions by 1 million tons in only 2023. And of course, we also delivered and created stranded value in the process. There is of course, much more we can do and demand from the AI sector is in fact, creating a very unique investment opportunity for developing a new energy system. And like I said, in the UAE, we have been viewing this as an opportunity for us to create more relationships and more partnerships. And we are currently exploring many new opportunities of co-investments, renewable energy projects globally. And our objective here, is to make more green electrons available for this transformative growth of AI worldwide. We were, in the United Arab Emirates, as an energy country, we embraced the energy transition very early on. We continued to invest in reducing our carbon emissions from our current energy system while we started investing in low-carbon solutions and in renewable energy. And because we do view the integration of AI and energy, and energy and AI as a new opportunity and in fact, a critical success factor, I intend to convene the key players in technology and in energy, in Abu Dhabi in November, ahead of ADIPEC and COP29, to drive solutions for the AI's energy needs and to develop solutions from AI, to reduce emissions and to unlock value from the current energy system while we continue exploring building the new energy system.
One of the things that I think is interesting, that I've had the opportunity to learn a little bit about that I was really not aware of before is that not every unit of energy, even the same kind of energy is the same when it comes to carbon emission. Take something like natural gas, you have been leading work to reduce the carbonization of natural gas and you've set an aggressive goal to reduce it by another 25% by the end of this decade. Can you share with us what you've been doing, what you find the most promising?
We decided very early on that we will develop our own approach to the integration between renewables and hydrocarbons. So as such, while we continue to invest by applying scale and capital and renewable energy, we also did the same in the gas business. We applied capital, and we applied scale and helping commercialize and scale up the carbon capture and storage technologies. And we have demonstrated a very unique capability in Abu Dhabi, where we capture CO2 and we reduce our carbon emissions. We also believe that by integrating AI into energy, and energy into AI, we can build a bridge to a low-carbon, high-growth future. And I do believe we will be able to unlock the greatest opportunity in socioeconomic development since the first industrial revolution. We view the integration between AI and energy, and energy and AI, as a true, game-changing, new economic opportunity that we will continue to invest in.
I think that connects naturally with another point that I've heard you make, which is the world needs more electrons. Can you share with us what that means to you?
In simple terms, we need to be pragmatic about our approach when it comes to being able to meet the global energy demands. Data centers are growing and we need to come to terms with the reality that the investment in the energy sector today, will not enable the energy system to cater for such demand. As such, we need to approach it differently. We need to focus very much on efficiency and optimization from the current energy system. And in parallel, start thinking the new energy system which will consist of oil and gas, the decarbonized oil and gas with the lowest carbon intensity, gas as a bridge, nuclear and renewable energy.
One of the interesting things, I think, about ADNOC, as well as the role that you took to bringing together everyone for COP28 is that this energy transition, a transition that requires more energy, not less; it's worth remembering we still have 700 million people on Earth that don't yet have electricity at all, so we have a lot more electrons that need to be unleashed. It is going to require the energy companies of today to play a critical role in building the energy infrastructure of the future. And in addition to what you've described here, reducing the carbonization of something like gas, you've also led the way in constructing solar. I think most people would not know that the largest solar power plant in the world is in the United Arab Emirates. You've also made that a signature part, I think, of the work you've been doing for perhaps almost two decades now. Tell us a little bit about what you've done in that space and what you take away from having done that work.
In fact, we do have in operation today, in the United Arab Emirates, the three largest solar power plants in the world, and we are very proud of that achievement. But this journey started back in 2006, when the leadership of the United Arab Emirates took a bold decision to launch a new economic development program entirely dedicated to sustainability and to renewable energy. And at the time we launched Masdar, a company that has been able to become in a very short period of time, the largest just renewable energy investor in the world.
Which you were the founding leader?
