Market Overview
| Study Period | 2020 - 2030 |
|---|---|
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2030 |
| Market Volume (2025) | 45.56 gigawatt |
| Market Volume (2030) | 53.63 gigawatt |
| Growth Rate (2025 - 2030) | 3.32% CAGR |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
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United Arab Emirates (UAE) Power Market Analysis by Mordor Intelligence
The United Arab Emirates Power Market size in terms of installed base is expected to grow from 45.56 gigawatt in 2025 to 53.63 gigawatt by 2030, at a CAGR of 3.32% during the forecast period (2025-2030).
Capacity expansion is shaped by sustained population growth, electrification of industry, and the UAE Energy Strategy 2050, which commits to a 50% clean-energy mix by mid-century. Gas-fired plants continue to anchor baseload supply, yet solar additions and the 5.6 GW Barakah nuclear plant are steadily lowering the carbon intensity of generation. Record-low solar tariffs, rising corporate demand for renewable power purchase agreements, and federal support for green hydrogen are amplifying investor confidence across the UAE power market. At the same time, rapid growth in data-center load and electrified transport is accelerating grid-modernization spending and stimulating interest in large-scale battery storage solutions.
Key Report Takeaways
- By generation source, thermal power led with 77.5% of UAE power market share in 2024; renewable energy is forecast to expand at a 13.5% CAGR through 2030.
- By end-user sector, utilities held 62.5% share of the UAE power market size in 2024, while residential demand is projected to advance at an 11% CAGR between 2025-2030.
United Arab Emirates (UAE) Power Market Trends and Insights
Drivers Impact Analysis
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Solar program rollouts under UAE Energy Strategy 2050 | +45.20% | Abu Dhabi and Dubai | Medium term (2-4 years) |
| Green-hydrogen initiatives accelerating renewable integration | +24.10% | Primarily Abu Dhabi | Long term (≥ 4 years) |
| Commissioning of Barakah nuclear units adding baseload capacity | +21.10% | National grid | Short term (≤ 2 years) |
| Liberalization of Wholesale Electricity Market and Private IPP Participation | +18.1% | National, with early gains in Abu Dhabi | Medium term (2-4 years) |
| Mandatory Building Rooftop PV Regulations Accelerating Distributed Generation | +12.3% | Dubai, with gradual expansion to other emirates | Medium term (2-4 years) |
| Strategic Interconnection (GCCIA & planned HVDC exports) Opening Export Opportunities | +9.0% | National, with international implications | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
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Large-scale Solar Program Rollouts under UAE Energy Strategy 2050
Solar additions more than doubled national photovoltaic capacity between 2019 and 2023, reaching 6.1 GW after 70% growth in 2023 alone. Competitive auctions continue to push levelized solar costs below USD 0.02/kWh, making solar the cheapest new-build option in the UAE power market. Flagship projects such as Al Dhafra (2 GW) and the Mohammed bin Rashid Al Maktoum Solar Park (5 GW by 2030) underscore investor appetite. The surge in variable output is accelerating investment in advanced forecasting, demand-response programs, and synchronous condensers to safeguard grid stability. Utility strategies increasingly bundle solar capacity with battery energy storage to deliver round-the-clock supply, as evidenced by the 5.2 GW PV plus 19 GWh battery complex announced for Abu Dhabi(1)Zawya Editorial Team, “Abu Dhabi Launches 24/7 Solar + Storage Gigaproject,” zawya.com.
Green-Hydrogen Initiatives Boosting Renewable Integration into Grid
The National Hydrogen Strategy targets 1.4 million t of production by 2031 and 15 million t by 2050. Power-to-gas-to-power pathways will convert surplus solar into dispatchable generation, aligning renewable oversupply with peak-demand periods in the UAE power market. Masdar’s 2025 letter of intent with OMV to develop green hydrogen and e-fuels illustrates cross-sector interest. Abundant solar resources and existing gas pipelines create a cost edge that supports plans for a 2,200-km hydrogen network by 2040. The resulting flexibility underpins higher renewable penetration while laying the groundwork for exporting up to 25% of global low-carbon hydrogen demand by 2030.
Commissioning of Barakah Nuclear Units Adding Baseload Capacity
Full commercial operation of Barakah’s fourth unit in September 2024 delivered 5.6 GW of zero-carbon baseload, supplying 25% of national electricity and avoiding 22 million t CO₂ annually. The predictable output stabilizes frequency in an increasingly solar-heavy UAE power market and reduces reliance on gas imports. Success is spurring feasibility studies for a second nuclear site and an MoU with GE Vernova Hitachi (May 2025) to explore BWRX-300 small modular reactors(2)GE Vernova, “ENEC and GE Vernova Hitachi Sign MoU on SMRs,” gevernova.com. Nuclear diversity strengthens energy security and helps the UAE align with its 2050 Net-Zero pledge.
Liberalization of Wholesale Electricity Market and Private IPP Participation
A phased transition from vertically integrated utilities toward competitive tenders is lowering tariffs and mobilizing foreign direct investment. Abu Dhabi’s Emirates Water and Electricity Company (EWEC) now procures capacity through reverse auctions that routinely set regional price benchmarks. The April 2025 agreement to reconfigure the 1.1 GW Shuweihat 1 plant illustrates how flexible reserve assets are being structured under new power-purchase frameworks. Liberalization helps the UAE power market absorb rapid demand growth without overburdening the public balance sheet, while disciplined regulation maintains service reliability.
Restraints Impact Analysis
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Gas Price Volatility Challenging Thermal Generation Cost Competitiveness | -21.1% | National, with greater impact on Abu Dhabi | Medium term (2-4 years) |
| Grid Congestion in Northern Emirates Limiting Renewable Project Integration | -15.1% | Northern Emirates (Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah, Fujairah) | Short term (≤ 2 years) |
| Water–Electricity Cogeneration Plants' Retrofitting Complexity Slowing Decarbonization | -9.3% | Coastal areas, particularly Abu Dhabi | Medium term (2-4 years) |
| Limited On-shore Wind Resource Compared to Solar Reducing Technology Diversification | -6.0% | National | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
Gas Price Volatility Challenging Thermal Generation Cost Competitiveness
Natural-gas imports have risen as domestic fields mature, exposing the UAE power market to global price swings. When spot LNG doubled during 2022-2023, gas-fired generation became less competitive than USD 0.02/kWh solar auctions. Long-term supply contracts and ADNOC’s upstream expansion aim to shield generators, yet uncertainty complicates financing for new thermal projects. Developers increasingly bundle gas plants with carbon-capture or peaking-only roles to mitigate volatility while retaining essential flexibility as renewable penetration climbs.
Grid Congestion in Northern Emirates Limiting Renewable Project Integration
Transmission lines in the Northern Emirates were designed for legacy load patterns and now operate near thermal limits during peak hours. Curtailments threaten project economics, prompting a USD 17.6 billion smart-grid upgrade programmed through 2027. Upgrades include dynamic-line rating, high-temperature conductors, and AI-based congestion management to unlock hosting capacity for new solar assets. Until works are completed, developers may favor Abu Dhabi and Dubai, perpetuating regional imbalances in the UAE power market.
Segment Analysis
By Power Generation Source: Nuclear Reshapes Baseload Mix
Thermal plants delivered 77.5% of generation in 2024, giving this segment the leading UAE power market share for baseload supply(3)World Nuclear Association, “Barakah Nuclear Power Plant Factsheet,” world-nuclear.org. Gas turbines at EGA – Al Taweelah (2,620 MW) and Hassyan (2,400 MW) anchor peak-demand coverage, yet rising gas-price exposure tempers future capacity growth. The UAE power market size attributable to thermal assets will rise modestly through 2030, but its percentage share will slip in favor of low-carbon options. Environmental policy, carbon-pricing discussions, and corporate decarbonization targets reinforce the pivot toward clean energy even as legacy gas assets retain a critical balancing role.
Renewable capacity registered a 13.5% forecast CAGR for 2025-2030, the fastest in the UAE power market. Utility-scale projects dominate, leveraging vast desert sites and cheap land leases to achieve global record tariffs. Coupled with Barakah, renewables drive a structural decline in grid emissions intensity from 0.42 kg CO₂/kWh in 2023 to an expected 0.29 kg CO₂/kWh by 2030. Nuclear now supplies 25% of demand, providing a reliable floor that allows system operators to curtail gas output during periods of high solar generation.
Note: Segment shares of all individual segments available upon report purchase
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By End-user Sector: Data Centers Drive Demand Surge
Utilities retained 62.5% of the UAE power market size in 2024, reflecting centralized procurement of bulk power(4)Energy Utilities, “DEWA Deploys Automatic Smart Grid Restoration System,” energy-utilities.com. Digital transformation within TAQA and DEWA is unlocking operating efficiencies through AI-enabled asset management and predictive maintenance. On the demand side, hyperscale data-center operators have announced 500 MW of new capacity pipelines, intensifying pressure on utilities to deliver renewable power options and 24/7 clean-energy matching.
Residential demand, though smaller today, is set to expand at an 11% CAGR from 2025-2030. Smart-home adoption and rooftop PV regulations in Dubai contribute to rising behind-the-meter generation that eases grid load during daylight hours. Cooling loads account for up to 43% of household electricity consumption during summer peaks. Smart-meter rollout under DEWA’s AED 7 billion program is giving consumers granular usage data and facilitating time-of-use tariffs that flatten system peaks across the UAE power market.
Note: Segment shares of all individual segments available upon report purchase
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Geography Analysis
Abu Dhabi hosts more than half of the installed capacity and is home to the 5.6 GW Barakah plant, which alone supplies 25% of national demand. The emirate’s 5.2 GW solar-plus-storage project couples with 19 GWh of batteries to dispatch 1 GW of baseload renewable energy, a first-of-a-kind undertaking that is redefining capacity-credit assumptions in the UAE power market(1). EWEC has already reserved land for 4.6 GW of additional solar and onshore wind projects, underpinning Abu Dhabi’s target to reach a 60% clean-energy mix by 2030.
Dubai, through the Mohammed bin Rashid Al Maktoum Solar Park, will reach 5 GW by 2030, supporting the emirate’s ambition for 75% clean energy by 2050. DEWA’s AED 7 billion smart-grid program installs over 2 million smart meters and automates 100% of primary substations to handle two-way power flows. A 400/132 kV substation tendered in 2024 will reinforce export capacity toward the Northern Emirates once commissioned in Q4 2027(1)Zawya Editorial Team, “Abu Dhabi Launches 24/7 Solar + Storage Gigaproject,” zawya.com. These investments help Dubai mitigate solar output variability and maintain the highest supply reliability indices in the UAE power market.
Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah, and Fujairah together hold less than 10% of total capacity, yet their demand is growing at a faster clip due to industrial expansion and population growth. Grid congestion limits renewable integration, prompting federal authorities to prioritize transmission upgrades in the USD 17.6 billion national smart-grid. Sharjah’s pilot rooftop PV incentives and Ras Al Khaimah’s energy-efficiency code illustrate how smaller emirates align with national goals while tailoring policies to local resource potential. Balanced capacity additions across all emirates will reinforce system resilience and help avoid overconcentration risks in the UAE power market.
Competitive Landscape
The UAE power market comprises vertically integrated utilities—TAQA, DEWA, and EWEC—that control most generation and all transmission and distribution assets together. TAQA reported AED 14.2 billion revenue for Q1 2025, a 3.8% year-on-year rise largely credited to transmission and distribution earnings. These incumbents are repositioning as energy transition facilitators, setting emission-reduction pathways and co-investing in renewable megaprojects alongside international developers.
Partnership models dominate new-build projects. EWEC, TAQA (60%), ENGIE (20%), and Sumitomo (20%) are reconfiguring the 1.1 GW Shuweihat 1 plant into a reserve-capacity asset under a 15-year PPA commencing in 2027. Masdar’s JV approach with EDF Renewables, ACWA Power, and JinkoSolar accelerates capital deployment while distributing risk. The competitive tendering process rewards bidders that combine low cost of capital, technology know-how, and robust execution track records, further professionalizing the UAE power market.
Digital-solution providers are capturing value in grid management, predictive analytics, and asset performance optimization. TAQA Water Solutions invested AED 95 million in an AI-driven SCADA platform in December 2024, seeking a 10% reduction in network losses. GE Vernova Hitachi and Siemens Energy supply advanced turbines and grid hardware while exploring modular nuclear and hydrogen-turbine opportunities. Market entrants focused on grid-scale storage, virtual power plants, and digital twins are positioning to exploit whitespace created by rising intermittency and evolving regulatory frameworks in the UAE power market.
United Arab Emirates (UAE) Power Industry Leaders
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Abu Dhabi National Energy Company PJSC (TAQA)
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Dubai Electricity and Water Authority(DEWA)
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Emirates Water and Electricity Company (EWEC)
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ACWA Power Company
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Emirates Nuclear Energy Corporation (ENEC)
- *Disclaimer: Major Players sorted in no particular order
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Recent Industry Developments
- May 2025: Emirates Nuclear Energy Corporation signed an MoU with GE Vernova Hitachi to explore BWRX-300 small modular reactors and chart a roadmap for commercialization.
- April 2025: EWEC, TAQA, ENGIE, and Sumitomo inked a 15-year PPA to convert Shuweihat 1 into a 1.1 GW flexible-reserve facility.
- April 2025: Masdar and OMV agreed to collaborate on green hydrogen and sustainable aviation fuels, advancing plans to reach 100 GW of renewables by 2030.
- January 2025: Masdar and EWEC launched the first 24/7 gigascale solar-plus-storage project—5.2 GW PV with 19 GWh batteries—delivering 1 GW baseload power.
Research Methodology Framework and Report Scope
Market Definitions and Key Coverage
Our study defines the UAE power market as the sum of grid-connected installed generating capacity, thermal, nuclear, and renewable, that is available to the national transmission and distribution network and measured in gigawatts (GW). It captures capacity commissioned by federal utilities and independent power producers that sell to Emirates-level off-takers.
Scope exclusion: Behind-the-meter captive plants below 5 MW, stand-alone diesel generators, and electricity trading revenues are excluded from the sizing.
Segmentation Overview
- Power Generation Source
- Thermal (Natural Gas, Oil, etc)
- Nuclear
- Renewables (Solar, Wind, etc)
- End-user Sector
- Residential
- Commercial and Industrial
- Utilities
Detailed Research Methodology and Data Validation
Primary Research
Interviews and structured surveys with grid planners, EPC contractors, solar park developers, and regulatory officials across Abu Dhabi, Dubai, and the Northern Emirates allowed us to verify commissioning schedules, capacity factors, and tariff expectations, which filled gaps left by desk work and sharpened assumption ranges.
Desk Research
We began with publicly available datasets from the Federal Competitiveness & Statistics Center, International Energy Agency, and the Ministry of Energy & Infrastructure, which outline yearly capacity additions, fuel mix, and peak-load evolution. Trade association releases, such as those from the Middle East Solar Industry Association, and multilateral papers from the IRENA and the World Bank enriched understanding of renewable build-out economics. Complementary insights on corporate strategy, project pipelines, and average selling prices were drawn from utility annual reports and investor presentations, then screened through Dow Jones Factiva for corroborating news coverage.
Subscription sources in Mordor's toolkit, notably D&B Hoovers for company financials and Questel for patent activity around grid-scale storage, helped validate technology adoption curves. This list is illustrative; many additional references informed cross-checks and narrative shaping.
Market-Sizing & Forecasting
A top-down construct starts with historical installed capacity, official five-year expansion plans, and net reserve-margin targets; these are then reconciled with selective bottom-up roll-ups of announced plant capacities and sampled weighted average capital costs. Key variables like population growth, peak-demand elasticity, gas price outlook, solar PV tariff bids, capacity factor by technology, and nuclear ramp-up milestones drive the multivariate regression that projects capacity to 2030. Bottom-up gaps, especially in distributed solar, are bridged with penetration-rate benchmarks from DEWA's Shams Dubai roster.
Data Validation & Update Cycle
Mordor analysts triangulate provisional outputs against independent indicators such as monthly fuel burn, grid emission factors, and tender awards. Variances beyond preset thresholds trigger re-engagement with sources before sign-off. The model is refreshed annually, with interim updates when material events, like Barakah Unit 4 synchronization, occur.
Why Mordor's UAE Power Baseline Remains Dependable and Influential
Published figures for the same market often diverge because firms differ in unit of measure, technology scope, and refresh cadence.
Key gap drivers include whether studies report installed capacity or electricity generated, how they treat upcoming but unwired projects, and the currency year chosen for baselining. Our analysts lock scope to grid-connected capacity, apply uniform derating factors, and update assumptions each quarter, which together reduce volatility in the baseline year.
Benchmark comparison
| Market Size | Anonymized source | Primary gap driver |
|---|---|---|
| 45.56 GW (2025) | Mordor Intelligence | - |
| 60 GW (2025) | Regional Consultancy A | Counts committed projects still awaiting financial close |
| 183.67 TWh (2024) | Trade Journal B | Uses energy produced, not capacity, hindering like-for-like comparison |
| 79.1 GW (2035) | Global Consultancy C | Presents long-range scenario, then back-allocates to current year, inflating baseline |
In sum, Mordor's disciplined scope definition, variable selection, and timely refresh give decision-makers a balanced, transparent baseline that links clearly to observable capacity additions and policy signals.
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Key Questions Answered in the Report
What is the projected capacity of the UAE power market by 2030?
The UAE power market is expected to reach 53.63 GW by 2030, up from 45.56 GW in 2025.
How much electricity does the Barakah Nuclear Power Plant supply?
Barakah supplies 25% of national demand, producing around 40 TWh of zero-carbon electricity annually.
Which generation segment is growing fastest in the UAE power market?
Renewable energy—primarily large-scale solar—is the fastest-growing segment, with a 13.5% CAGR forecast for 2025-2030.
Why is grid congestion a concern in the Northern Emirates?
Existing transmission lines in Sharjah, Ajman, UAQ, Ras Al Khaimah, and Fujairah are operating near capacity, limiting new renewable connections until smart-grid upgrades finish in 2027.
How is market liberalization changing investment patterns?
Competitive auctions and independent power-producer frameworks are attracting foreign capital, lowering tariffs, and accelerating deployment of flexible reserve assets.
What role will green hydrogen play in the UAE’s energy strategy?
Green hydrogen will absorb excess solar output, provide long-duration storage, decarbonize hard-to-electrify sectors, and position the UAE to supply up to 25% of global low-carbon hydrogen demand by 2030.
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