A Green University

The rulers of Abu Dhabi have seen the future, and it's not oil. The evidence of that is everywhere in this petro--emirate—from gleaming solar panels to the hundreds of billions of dollars invested in diversified foreign assets. But perhaps the greatest single testament to Abu Dhabi's bet on life after oil is the Masdar Institute of Science and Technology, which opens this autumn. Masdar Institute will be the world's first postgraduate research university in science and engineering focusing on alternative energy and -sustainability—and in a self-contained green city to boot. With the global economy on edge and oil prices half what they were a year ago, the timing couldn't be better.

Today, Masdar Institute is just a shell of a building in a thicket of construction cranes. But once completed, MI will be the cornerstone of a $22 billion city of the future rising out of the sand on the edge of the Rub al Khali—or Empty Quarter—desert in Abu Dhabi. Masdar City aspires to be the world's first built-from-scratch eco--city. Over the next decade, if the economic downturn doesn't derail plans, Masdar will grow to house 40,000 -residents—in a solar-powered, car-free, zero-waste, carbon-neutral city environment that just happens to sit atop some of the richest oilfields on the planet. The idea is for the government of Abu Dhabi, in partnership with tech companies, to transform these once desolate six square kilometers into a kind of Silicon Valley of clean-energy know-how.

The Masdar Institute was founded in June 2008 with a five-year investment of $1.5 billion from the Abu Dhabi government The emirate's key partner in the venture is the Massachusetts Institute of Technology. When MI opens its doors on Sept. 6, its faculty will have spent up to a year working closely with MIT professors. MIT and MI are also collaborating on the development of joint research projects, and MIT is providing assistance in designing degree programs and helping to attract tech industries to Masdar City. In its first year, Masdar Institute aims to employ about 25 faculty members from around the world and 100 students; all on full scholarships, the students will come mostly from the Middle East and North Africa, as well as Europe and the United States.

It's a huge gambit: a fabulously wealthy oil state, whose people are among the world's biggest per capita emitters of greenhouse gases, is aiming to steal the march on solar and other alternative-energy technologies. Even for the U.A.E.—which has given the world Dubai, a gleaming financial center built from sand that seemed unstoppable until it recently hit tough economic times—the ambitions of Masdar City are grand. With MI at its heart, the city will be planned along the compact design of a traditional walled city, or al qasr (castle). Master-planned by Norman Foster's London architectural firm, it will have schools and shops, well-shaded streets, and energy-efficient buildings. A light-rail system will ferry commuters, visitors, and goods between the solar city and other parts of the country, and in Masdar itself, 3,000 computerized, -battery-powered small personal transit pods (automated vehicles that run on rails and carry four to six people) will deliver passengers to stops within 200 meters of their final destination. Like a castle, the city will be surrounded by what sustains it: wind and photovoltaic farms and algae ponds that scientists hope will someday produce biofuel.

It's hard to imagine a more appealing public-relations exercise for Abu Dhabi's ruling Al Nahyan family. The big question, of course, is whether they'll be able to deliver. The emirate certainly has the cash: though oil prices and Abu Dhabi's reserves are in decline, the city-state's supplies are still the world's sixth-largest and projected to last throughout the century. And with assets approaching $1 trillion, Abu Dhabi's sovereign wealth fund is larger than all but a few banks.

Meanwhile, preparations are well underway. MI's faculty has already been hired, and 25 research assistants—future MI grad students—are hard at work. Provost John Perkins, formerly dean of the faculty of engineering and physical sciences at England's University of Manchester, says the institute has received 1,000 applications for its 100 slots, and 80 students have committed to attend this fall. MI is also "in the process of signing contracts" with commercial partners (it won't name who just yet) to conduct joint research and develop new technologies, says Tariq Ali, vice president for research and industrial relations, and the former director of the Energy Futures Lab at Imperial -College London.

Getting the school up and running is one thing. Having it fulfill the ambitions of Abu Dhabi's rulers is quite another. MI and Masdar City are both part of the umbrella Masdar Initiative, which is devoted to the development of future energy technologies and was established by Sheik Mohammed bin Zayed Al Nahyan, the crown prince of Abu Dhabi. Masdar is Arabic for "source," and MI is meant to be a magnet for talent from abroad, a seedbed for U.A.E. scholars and, ultimately, an exporter of talent and technologies to other parts of world.

Quick transformations—sometimes dangerously quick—are part of the history of the Gulf states. A few kilometers to the west of Masdar City stand sparkling new office towers along a seaside corniche, monuments to the oil wealth that has transformed Abu Dhabi in half a century from an agricultural and fishing economy into a rich and fast-growing petrostate. Oil was not discovered here until 1958, and Abu Dhabi got its first paved road in 1961. But in recent decades, change has come in torrents. Neighboring Dubai transformed itself into a global financial center and a capital of excess. But Abu Dhabi, under Sheik Zayed bin Sultan Al Nahyan—who ruled the emirate from its independence from Britain in 1971 until his death in 2004—always followed a somewhat more cautious approach. His successors have followed this more conservative model, and this augurs well for MI.

Environmentalism is a new and relative concept here. But Sheik Zayed recognized that as a major oil producer Abu Dhabi had a special responsibility to the environment and that the ruling family had a special responsibility to prepare the emirates for life after oil. In 2005, his approach was posthumously lauded by the United Nations Environment Program, which named him as one of its "Champions of the Earth."

Zayed's son, Sheik Khalifa bin Zayed Al Nahyan, the current president of the U.A.E. and Emir of Abu Dhabi, has carried on that tradition. Earlier this year he announced what purports to be the most ambitious sustainability program ever launched by a government, starting with $15 billion for education; manufacturing; and research and development projects in solar, wind, and hydrogen power.

And then there's Masdar. In recent years, a number of universities, from Texas A&M to Yale, have set up programs and campuses in the Gulf. The trend has proved profitable to the mother schools and beneficial to local countries. Once, the Gulf's best and brightest traveled abroad for their higher education (and often stayed abroad), but now they increasingly have the chance to study at home. A new brain gain has mitigated, if not stopped, the brain drain.

MI aims to take the satellite-campus model a step further. It's not a branch of a foreign university, though it draws on MIT's expertise. The concept and the money are local. MI aims to keep promising young science grads at home and attract others from abroad. The emirate is protective of its culture and mores and yet keen to trade the oil straitjacket for the opportunities of the knowledge economy. That is a balance not easily struck in a place that has moved from ancient to modern at such speed. Money may be no object even in these straitened times, but cultural resistance to change and outside influence could be. In that sense, perhaps the promising thing about Masdar is that—however big the idea behind it—the project is starting small.