UAE companies to start tracking and reporting carbon emissions

The United Arab Emirates (UAE) will require companies to monitor and report their emissions in an effort to reach a target to become carbon neutral by 2050. All companies with emissions equivalent to 500,000 tonnes or more of carbon dioxide per year are required to participate, according to legislation that came into force on Dec 28. 

The UAE, which hosted the United Nations’ COP climate summit last year, is the first Middle Eastern country to force companies to measure their emissions, reflecting its aim to be a regional leader in tackling climate change. That may pave the way for implementing a system to penalise polluters with an European Union-style (EU) cap-and-trade system. 

Even so, UAE policymakers worry that forcing companies to do too much to address their emissions will encourage them to relocate to neighbouring countries that don’t have such requirements. These concerns may prevent the country from adopting the most stringent measures. The new rules cover so-called scopes 1 and 2, which include direct emissions from sources owned or controlled by a company, such as a fleet of trucks or a power plant, as well as pollution from the generation of energy the company buys, such as electricity.  Abu Dhabi launched a system for companies within the emirate to measure, report and verify (MRV) their emissions on Thursday. Other emirates are yet to announce their MRV systems.