United Arab Emirates Solar Photovoltaic (PV) Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

United Arab Emirates Solar Photovoltaic (PV) Market Trends and Insights

Falling Solar PV Tariffs

Record-setting bids at Al Ajban reduced the benchmark price to 1.413 cents per kWh in 2024, eclipsing the previous global low at Al Dhafra. Module overcapacity in China has forced polysilicon prices below USD 7/kg, a level that has trimmed utility-scale capital costs by 15% compared to 2022. The result is a levelized cost below that of combined-cycle gas units, spurring the early retirement of aging turbines. Developers now routinely specify bifacial TOPCon modules with 23.3% efficiency, pairing them with trackers to unlock an extra 10%-15% yield.^{[1]Astronergy, "ASTRO N5 Module Data sheet," astronergy.com} With inverter and balance-of-system prices falling 8%-12% annually, tariffs below 1.4 cents are expected to hold through 2026.

Rising Government Policies & Targets

The UAE Energy Strategy 2050 obliges 44% clean energy and 14.2 GW of renewables by 2030, underpinning a multibillion-dirham procurement pipeline. Dubai’s Clean Energy Strategy 2030 aims for 75% clean energy by 2050, accelerating MBR Solar Park toward its 5 GW goal. Abu Dhabi’s Department of Energy mandates Emirates Water and Electricity Company (EWEC) to source 1.4 GW of renewables annually from 2027, anchoring bankable offtake contracts. Net-metering at 0.28 AED/kWh sustains rooftop economics, though the recent cap reduction to 1 MW introduces caution among large commercial users.

Megawatt-Scale Utility PV Projects

Flagship parks concentrate capital and technology. MBR Solar Park surpassed 2,860 MW in 2024 and aims to reach 5,000 MW, incorporating 1,000 MW of integrated storage by 2029. Al Dhafra’s 2 GW plant supplies 160,000 households and validated bifacial performance in harsh desert winds. The AED 22 billion 5.2 GW solar-plus-19 GWh storage project, led by Masdar, G42, and ADQ, will deliver 1 GW of dispatchable output for 19 hours daily from 2027. Streamlined tenders now move from RFP to financial close in under 12 months, reducing developer overheads.

Hybrid Solar+Storage for 24/7 Supply

Battery costs plunged from USD 300/kWh in 2020 to around USD 120/kWh in 2024. DC-coupled designs share inverters, trimming balance-of-system expense by up to 15% and lifting round-trip efficiency to 92%. Masdar’s Sir Bani Yas microgrid reduced diesel use by 1.5 million liters per year and demonstrated island resilience. DEWA’s D33 policy now offers industrial users a 25% connection-charge discount when storage is paired with solar, reducing the payback period to roughly five years.

Grid Integration & Curtailment Risk

Barakah’s 5.6 GW baseload occupies about 40% of Abu Dhabi demand, leaving limited room for daytime solar.^{[2]World Nuclear Association, "Barakal Unit 4 Connected to Grid," worldnuclear.org} Curtailment reached an estimated 3%-5% in 2024, trimming developer revenue despite take-or-pay contracts. Grid-forming inverters, such as Huawei’s FusionSolar, introduce synthetic inertia within milliseconds, easing frequency swings when the solar share spikes. EWEC’s AED 1.5 billion HVDC link between Abu Dhabi and Dubai will boost transfer capacity; however, until its completion, curtailment threatens margins.

Dust/Soiling-Water Scarcity O&M Burden

Sharjah Sustainable City data indicate a 0.21% daily output loss due to dust, equivalent to 24% annually without regular cleaning.^{[3]M. Al-harthy et al., "Quantifying Soiling Losses in Sharjah," ieeexplore.ieee.org} Manual washing consumes up to 0.5 liters per square meter per cycle, which is expensive in a desalination-dependent country. Robotic dry-brush systems at Al Dhafra reduce water use by 80% but incur approximately USD 20/kW in capital expenditures. Anti-soiling nano-coatings from Trina Solar reduce deposition by roughly one-third, extending wash intervals to three weeks. A 200 MW site study found that robotic cleaning increased the net present value by USD 12 million over 25 years, validating the business case.

Segment Analysis

By Grid Type: On-Grid Scale Continues, Off-Grid Accelerates

On-grid systems accounted for 95.30% of the UAE's solar photovoltaic (PV) market capacity in 2024, primarily driven by long-term power purchase agreements with DEWA and EWEC. Utility parks, such as MBR Solar Park and the upcoming 5.2 GW solar-plus-storage project, will account for approximately 4.2 GW of the 4.84 GW net increase forecasted to 2030. The UAE solar photovoltaic (PV) market size for on-grid additions is thus on track to more than double by the end of the decade. Standardized tender templates and favorable land concessions minimize development risk, while grid upgrades align with increasing capacity. However, rising curtailment during low-demand months pushes operators to integrate storage and invest in grid-forming inverters.

Off-grid installations, although starting from a small base, are set to post a 19.10% CAGR through 2030, outpacing every other segment. Remote islands, desalination facilities, and telecom towers are now favoring solar-plus-storage over diesel, with Sir Bani Yas Island's 4.5 MW array and 3 MW/6 MWh battery system eliminating 1.5 million liters of diesel annually.^{[4]Masdar, "Sir Bani Yas Solar-Battery Project Factsheet," masdar.ae} The UAE solar photovoltaic (PV) market benefits from microgrid economics where grid extension costs exceed USD 500,000/km. Projects in the Northern Emirates, backed by ADNOC Distribution's Phase 2 station solarization, illustrate the emerging commercial logic. Floating solar for desalination at Hassyan will broaden the addressable off-grid pool once commissioned in 2027.

Note: Segment shares of all individual segments available upon report purchase

By End-User: Residential Momentum Challenges Utility Dominance

Utility-scale plants represented 72.50% of capacity in 2024, underpinned by multi-year PPAs and debt leverage ratios of nearly 80%. Tariffs below 1.5 cents per kWh keep these assets competitive against gas peakers. The UAE solar photovoltaic (PV) market, dominated by utility-scale, is projected to maintain absolute leadership; however, its CAGR lags behind smaller formats. Developers are responding to curtailment and nuclear crowd-out by co-locating 4-hour storage, which boosts capacity factors and protects revenue.

Residential rooftops are forecast to grow at 16.00% CAGR, triple the utility-scale rate. Shams Dubai surpassed 10,000 participants and 280 MW of distributed capacity in 2024. Turnkey system costs now range from USD 0.90 to 1.10/W, making paybacks of six years achievable even after the net-metering cap was reduced to 1 MW. Solar-as-a-service firms, such as Yellow Door Energy and SirajPower, finance zero-upfront installations, thereby broadening access. The UAE solar photovoltaic (PV) market share held by residential systems could reach the low-double digits by 2030, provided other emirates replicate Dubai’s incentives. Commercial and industrial rooftops bridge the two ends, with CleanMax’s AED 99 million financing to roll out 69 MWp across 92 sites, signaling lender confidence.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Abu Dhabi and Dubai host more than 85% of the national solar photovoltaic (PV) capacity, cementing their primacy in the UAE solar PV market. Abu Dhabi leads in absolute volume, with the 2 GW Al Dhafra plant, the 1.5 GW Al Ajban project, and the 5.2 GW solar-plus-19 GWh storage megaproject slated for 2027. EWEC’s commitment to procure 1.4 GW annually from 2027 maintains a predictable pipeline and supports supply-chain localization. Robust transmission corridors and the presence of Barakah’s baseload inform an integrated planning approach that reduces curtailment.^{[5]EWEC, "Future Capacity Procurement Outlook," ewec.ae}

Dubai has adopted a single-site strategy at the MBR Solar Park, which reached 2,860 MW in 2024 and aims to reach 5 GW by 2029. Complementing the flagship park, the Shams Dubai rooftop scheme embeds distributed generation across commercial and residential districts, slightly altering load curves and providing ancillary capacity during peak afternoons. Grid investments, including phase-shifting transformers and STATCOM installations, safeguard voltage stability as the share of solar energy rises.

Sharjah, Ajman, Ras Al Khaimah, Fujairah, and Umm Al Quwain collectively account for less than 10% of current capacity, yet they offer niche growth opportunities. Sharjah Sustainable City functions as a testbed for bifacial and anti-soiling studies, circulating O&M best practices nationwide. ADNOC Distribution’s rollout of off-grid arrays at over 100 service stations in the Northern Emirates illustrates commercial appetite even in smaller load centers. Coastal Fujairah is poised for solar-powered desalination, while Ajman is exploring green hydrogen pilots. Cumulatively, the lesser-populated emirates may secure 5%-8% of incremental capacity by 2030, primarily through distributed systems that mitigate curtailment risk and capitalize on high irradiation.