Saudi Arabia announced on Friday a plan to establish an exchange for carbon credits and carbon offsets. The exchange is called the Riyadh Voluntary Exchange Platform and will trade carbon credits for countries throughout the Middle East and North Africa.
As a result, companies in the regions mentioned above will be able to reduce carbon emissions by exchanging carbon credits.
This move comes as Saudi Arabia plans to keep within the Paris agreement’s temperate goal of 1.5 degrees Celsius above pre-industrial levels. As well, the COP26 climate conference is coming up in November.
In March, Saudi Arabia announced it would plant 50 billion trees across the Middle East. 10 billion trees are to be planted directly in Saudi Arabia while the remaining 40 billion trees will be planted in neighboring countries. In addition, the Saudi plan to reduce carbon emissions includes increasing biodiversity on land and in the sea. Also, half of the country’s power will come from renewable energy sources by 2030.
As a major exporter of oil, the Saudi Arabians are under pressure to conform to renewable sources. Oil is one power source that could be phased out in the future. The Saudi Arabians must be prepared for when that day comes.