The International Renewable Energy Agency (Irena), which was established in January this year, has chosen to locate its headquarters in Abu Dhabi’s Masdar City.

This choice was also said to mark the first time that an international organisation has chosen a Middle Eastern city for its headquarters.

The city is billed as the world’s first carbon-neutral, zero-waste city, which will be powered entirely by renewable energy.

The Masdar City project is headed by the Abu Dhabi Future Energy Company. It was initiated in 2006, projected to cost $22-billion and take some eight years to build. Construction is already under way, and the first phase was scheduled to be completed and habitable in 2009.

In securing the location for Irena, the United Arab Emirates (UAE) faced competition from Germany, Austria and Denmark, which are all recognized leaders in renewable energy. However, the UAE's ability to serve as a bridge between the developing and developed world; the allure of the world's first carbon-neutral city; and a generous commitment of financial and political support gave Masdar City an edge.

As part of its commitment to Irena, the UAE offered to support the agency with a grant of $136-million over a six-year period, while also covering all operational costs in perpetuity. Moreover, the Abu Dhabi Fund for Development created a special endowment of up to $50-million yearly to be used for loans in support of renewable energy projects in the developing world.

"This is a great achievement for the UAE, but more importantly it is a testament to the strength of the relationships we have established throughout our campaign. It was very important for us to offer Irena a value proposition that would help the agency achieve its goals by engaging with developing and developed nations alike," said UAE Minister of Foreign Affairs Sheikh Abdullah Bin Zayed Al Nahyan.

"The UAE is committed to working with each of the member countries and meeting the immediate needs of Irena to ensure its successful launch," he added.

"This has been a tremendous educational experience, and has strengthened bonds with our Irena co-members that will allow us to collectively advance the benefits of renewable energy on all continents," said Masdar City CEO Dr. Sultan Al Jaber.

He added that the efforts by the UAE to encourage non-signatory nations to join Irena not only strengthened the UAE bid, but also strengthened the organisation itself, which grew from 75 member States at the time of its foundation in January, to over 130 countries to date.

The UAE bid was said to have attracted wide spread international support by key figures, including United Nations general secretary Ban Ki Moon, former UK Prime Minister Tony Blair, and Nobel laureate and Intergovernmental Panel on Climate Change chairperson Dr Rajendra K Pachauri.

Masdar City has been described as the most ambitious sustainable development project in the world today, and was part of Abu Dhabi's Masdar Initiative, a multi-faceted investment in the development and commercialisation of innovative technologies in renewable and sustainable energies as well as sustainable design.

The city is planned to cover 6-km², and will be home to some 45 000 people and 1 500 businesses.

The architecture of the city is inspired by the traditional medinas, souks and wind towers of the Arab world.

The city is described as a “free zone clean-tech cluster”. Academics, researchers, students, entrepreneurs and financers and more than 1 500 visionary companies will have offices, research centres and operations within city walls, benefiting from 100% foreign ownership, zero taxes, zero import tariffs, zero restrictions on capital movement and among the strongest intellectual property protection in the region, the Masdar initiative said.

Phase one of Masdar City has begun - The Masdar Institute of Science and Technology is underway and Masdar City will be home to 100 students and faculty by the third quarter of 2009.

Irena said it aims at becoming the main driving force in promoting a transition towards the widespread and sustainable use of renewable energy on a global scale.

Acting as the global voice for renewable energies, Irena would provide practical advice and support for both industrialised and developing countries, help them improve their regulatory frameworks and build capacity. The agency will facilitate access to relevant information including reliable data on the potential of renewable energy, best practices, effective financial mechanisms and state-of-the-art technological expertise.

Newly appointed Irena DG Hermann Scheer, (also chair of the World Council for Renewable Energy and president of Eurosolar) said that the intention was to establish Irena as a counterbalance to the two existing international governmental organisations in the field of energy, the International Energy Agency and the International Atomic Energy Agency, which have continuously belittled and denounced the potential of renewable energy.

With 136 members, he highlighted that there was no other international governmental organisation, which had so many members at its formation.

The German contribution to Irena's budget will in the beginning amount to about €7-million.  “After its complete formation, Irena will have to be supplied with similar resources, not only on the part of Germany but also by other industrialised countries,” said Scheer.