Saudi Arabia wants to fight climate change by cutting carbon emissions, and it’s taking serious steps to do so. On Saturday, PIF (Saudi Arabia’s sovereign wealth fund), along with the Tadawul, announced their plan to establish the Riyadh Voluntary Exchange Platform. The platform will facilitate the trading of carbon credits amongst Saudi companies.
Carbon credits are tradeable certificates that represent the right to emit one ton of carbon dioxide and are a way to regulate and control carbon emissions by companies. According to Saudi Crown Prince Mohammed bin Salman, the exchange will offer a “motivational environment for companies and institutes to reduce their emissions.”
The timing of this announcement is good, as Saudi Arabia will be hosting The Middle East Green Initiative in its capital Riyadh from October 23rd to 25th.
Why it matters
Reducing carbon emissions is an important part of Vision 2030, Saudi Arabia's plan to overhaul its economy and reduce its dependence on oil. Last April, Crown Prince Mohammed bin Salman stated he wants 50% of the kingdom's energy to be produced by renewable sources by 2030.
