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  UAE power sector hits record $8.9bn in contracts

  8 October 2025

  

   

  The UAE’s power market has recorded its highest annual total for contract awards on record, with $8.9bn confirmed across 26 projects so far in 2025.

  The total surpasses all previous years, including the pre-pandemic peaks of 2017 and 2018, when contract awards were valued at $7.4bn and $7.3bn, respectively. 

  It is the first time since then that investment in power generation and transmission has returned to record levels, though the makeup of projects presents a more complex picture.

  Landmark project

  The largest contract award, and the only independent power producer (IPP) project contract this year, is the $6bn solar plant and 19GWh battery energy storage system (bess) in Abu Dhabi. 

  A consortium of India’s Larsen & Toubro and Power China won the main contract for the project, which will be the world’s largest round-the-clock combined solar and storage facility when completed.

  Developed by Abu Dhabi Future Energy Company (Masdar) in partnership with Emirates Water & Electricity Company (Ewec), this single IPP accounts for 67% of total contract value in 2025, reflecting how the UAE’s investment cycle has shifted from conventional engineering, procurement and construction (EPC) projects to large, capital-intensive public-private partnerships at the utility scale.

  In 2017, the only IPP made up about 15% of total power awards. A year later, the Hamriyah combined-cycle plant accounted for 21%. Across both years, 92 EPC contracts were issued for power projects.

  By contrast, in 2025, just 21 EPC contracts have been awarded, reflecting a narrower but higher-value market. While total spending has reached new highs, the number and diversity of projects have declined, signalling consolidation around large developer-led schemes.

  One other investment in the power sector exceeded $1bn this year. The Al-Dhafra open-cycle gas turbine (OCGT) plant is being financed by Abu Dhabi National Energy Company (Taqa). Taqa will operate the 1,000MW facility under a 24-year power-purchase agreement with Ewec, signed in April. A joint venture of South Korea’s Samsung C&T and local firm Trojan General Contracting secured the EPC contract.

  Pipeline projects  

  At present, projects under bid evaluation total around $8.4bn, representing those expected to be awarded in the near term. Of this, $2.6bn is linked to solar photovoltaic (PV) schemes, $4.5bn to new gas-fired plants, and $1.1bn to substations and control centres. Five IPPs account for over 90% of the total value under evaluation.

  The largest is a 2,500MW gas-fired IPP planned within Abu Dhabi’s Al-Taweelah complex, for which three consortiums have submitted bids. The project is expected to be awarded in the fourth quarter of 2025, with the successful developer to hold a 40% equity stake.

  Further upstream, about $14.3bn-worth of power projects are currently out to tender. Oil- and gas-based plants comprise the largest share at $7.8bn, followed by $4.9bn in solar and $1.2bn in transmission works. The figures highlight how conventional power remains essential, even as renewables dominate long-term policy goals.

  Grid investments

  Beyond generation, Taqa Transmission has awarded $760m across nine grid projects, complemented by $550m in network and efficiency contracts through Taqa Energy Services. Emerge, the Masdar-EDF joint venture, added $226m in distributed solar projects, while Etihad Water & Electricity (Etihad WE) and Sharjah Electricity & Water Authority (Sewa) implemented smaller regional connection schemes valued below $50m each.

  These ownership patterns confirm the continuing concentration of activity around Abu Dhabi-linked entities, with Ewec, Masdar and Taqa driving most large-scale procurement. Dubai Electricity & Water Authority (Dewa) remains active through grid and solar expansion, while smaller northern utilities focus on targeted distribution upgrades aligned with regional demand.

  Transmission and distribution upgrades have become central to maintaining grid stability and integrating intermittent renewables. Ewec and Taqa are expanding 400kV and 132kV networks across Abu Dhabi and the Northern Emirates, while Dewa continues to reinforce its cable and substation systems in Dubai. These works are vital precursors to the next phase of large-scale solar and battery storage integration.

  Solar growth

  Renewables remain a key pillar, even as the pace of new awards moderates. Upcoming solar IPPs, including Ewec’s Al-Zarraf and Al-Khazna projects, will expand its capacity in clean energy to more than 6GW once operational. Contracts for both are expected to be awarded by the end of the year. 

  In Dubai, Dewa is focused on completing new phases of the Mohammed Bin Rashid Al-Maktoum Solar Park and piloting grid-scale storage initiatives. The utility is preparing to tender the main contract to develop the seventh phase to prequalified firms. This phase will include a 1,600MW solar PV plant and a 1,000MW bess, providing up to six hours of storage. 

  In terms of sector composition, solar power leads the way in 2025, representing $6.6bn of total contract awards, propelled by the $6bn Abu Dhabi solar and storage IPP.

  Oil- and gas-fired plants contributed $1.1bn, while transmission and cable works added $449m. The remaining share came from substation and control-centre developments. Waste-to-energy and wind remain limited, with less than $200m in combined tender activity this year.

  Market concentration

  Compared with previous cycles, ownership structures have stayed broadly consistent but become more concentrated. In 2022 and 2023, Dewa accounted for a higher number of smaller-scale projects, averaging about 15% of total annual contract value. In 2025, that share fell to about 10%, though with larger average contract sizes, reflecting a more strategic investment focus. Ewec’s total investment value, meanwhile, has more than doubled since 2024.

  Taken together, the figures present a mixed picture for 2025. The UAE’s power sector is attracting record levels of investment, but that capital is flowing into a handful of large IPPs rather than a broad portfolio of EPC schemes. The shift illustrates both the success of the public-private partnership model and the consolidation of opportunities into fewer, more complex projects, a sign of maturity, but also of growing selectivity in the market.

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  MEED's November 2025 special report on the UAE also includes:

  > GOVERNMENT: Public spending ties the UAE closer together
  > ECONOMY: UAE growth expansion beats expectations
  > CONSTRUCTION: UAE construction faces delivery pressures
  > TRANSPORT: $70bn infrastructure schemes underpin UAE economic expansion

   

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  Mark Dowdall
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  UAE construction faces delivery pressures

  8 October 2025

  

   

  Traffic backs up most mornings on the road into Abu Dhabi’s Mussafah Industrial Area, as trucks return after making early-morning deliveries to construction sites in Abu Dhabi and Dubai.

  The traffic reflects the record levels of construction activity currently underway in the UAE. It also points to the pressures involved when delivering projects in a market that is starting to overheat.

  Record awards 

  According to regional projects tracker MEED Projects, $53bn-worth of construction contracts were awarded across the UAE in 2024 – up 27% from the $45bn awarded in 2023, which itself broke the long-standing $32bn record set in 2008.

  The majority of the awarded work consists of building projects across subsectors such as residential, retail, commercial, hospitality, healthcare and education. Other recorded contracts include earthmoving, dredging and reclamation works.

  In terms of regional distribution, Dubai led with $35bn in contract awards in 2024.

  Abu Dhabi was the second most active market with $9bn, followed by Ajman with $3.2bn, Sharjah with $2.7bn and Ras Al-Khaimah with $2.2bn. The other emirates, Fujairah and Umm Al-Quwain, did not cross the $1bn mark. 

  As of 7 October 2025, total awards stood at $24bn, suggesting that the record highs of 2024 are unlikely to be repeated this year.

  Once again, Dubai remains the most active market with $18bn in awards, followed by Sharjah with $2.5bn, Abu Dhabi with $1.8bn and Ras Al-Khaimah with $1.7bn. The remaining three emirates, Ajman, Fujairah and Umm Al-Quwain, had not awarded more than $1bn in construction contracts.

  Activity surge

  The anticipated decline in contract awards in 2025 places the UAE in an interesting position.

  Although fewer new contracts are being awarded, construction activity across the federation continues to ramp up as contracts from 2023 and 2024 approach peak execution. It is this surge in activity that contributes to the traffic congestion in Mussafah and other industrial areas each morning.

  The heightened level of construction activity is having other effects. Developers are now increasingly concerned that there are not enough contractors to deliver their projects. This problem is particularly acute in the tier-one space, where leading international contractors – as well as some prominent local players – have exited the market.

  At the same time, developer ambition has grown. In the early stages of the post-Covid recovery, the market was focused almost exclusively on villa projects. Now, buoyed by sustained growth in property prices, heightened competition and a desire to stand out, developers are launching increasingly complex projects. These include tall towers and buildings with non-standard architectural forms that demand high levels of technical expertise to deliver.

  Even longstanding developers are feeling the strain. Emaar chairman Mohammed Alabbar was the first to raise the issue publicly, stating in late 2023: “We have problems in Dubai now with execution because the market is going 30% up every year in volume, which we have to handle.”

  Delivery solutions

  Various solutions are being explored to address this delivery challenge. Some developers are forming framework agreements with a pool of trusted contractors, while others are turning to direct negotiations or issuing limited tenders to only two or three firms.

  Some developers have taken matters into their own hands by delivering projects in-house, using their own contracting arms and suppliers. As market pressures intensify, more developers are following suit, setting up their own construction divisions to secure project delivery.

  Future outlook

  Based on the total value of contract awards so far this year, the market may soon get some respite. Further relief is expected in 2026 as projects awarded in 2023 near completion, followed by the wrap-up of 2024 awards.

  If the market cools, some of the delivery challenges experienced over the past two years should ease. While this would bring relief to many, there is lingering concern in the construction sector that Dubai’s market has shown a tendency over the past two decades to swing dramatically from boom to bust. If that pattern repeats, the consequences for the industry could be profound.

  Alternatively, 2025 may simply be a pause before activity returns to record levels in 2026. Although some reports have warned of a possible correction in the property market, rising prices continue to support project launches and contract awards.

  Should that trend continue, the delivery challenges of 2025 may well become the new normal.

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  MEED's November 2025 special report on the UAE also includes:

  > GOVERNMENT: Public spending ties the UAE closer together
  > ECONOMY: UAE growth expansion beats expectations

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  Colin Foreman
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  Kuwait awards oil contracts worth $2.2bn

  8 October 2025

  State-owned upstream operator Kuwait Oil Company (KOC) has awarded contracts worth KD679.4m ($2.2bn) for the supply, installation, surveillance and maintenance of electrical submersible pumping (ESP) systems.

  The contracts were awarded to the following companies:

  • Alkhorayef Petroleum Company (Saudi Arabia) – KD233.99m
  • Halliburton (US) – KD201.00m
  • SLB (US) – KD169.96m
  • Tianjin Rongheng Group (China) – KD74.95m

  According to KOC, the bids for the contracts were received in July.

  In September, New York-listed SLB, formerly known as Schlumberger, gained access to new ESP technologies through its acquisition of fellow American firm ChampionX.

  ESP systems are widely used in the oil and gas industry to boost production from reservoirs.

  The systems use an electric motor to power a multi-stage centrifugal pump submerged in an oil well to lift fluids to the surface.

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  Wil Crisp
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  UAE growth expansion beats expectations

  7 October 2025

  

   

  Bolstered by sustained economic diversification and a steady rise in exports, the UAE remains poised for robust growth well above the global average of 3% in 2025 and beyond its own growth projections.

  Following an estimated 4% real GDP expansion in 2024, the UAE economy is expected to accelerate its expansion to 4.8% in 2025, according to the Washington-based IMF. This is being driven by both strong non‑hydrocarbon activity and a rebound in oil output as Opec+ production cuts recede.

  Both GDP figures represent a further step up from the IMF’s April 2025 estimates of 3.8% and 4% for 2024 and 2025 respectively, with the UAE economy consistently outperforming the IMF’s growth expectations.

  Despite global economic uncertainty and rising instability, the UAE economy is expected to remain resilient in the near term, with the fund projecting growth will quicken to 5% in 2026.

  “The UAE has shown strong resilience to global uncertainty, regional conflicts and oil market volatility … supported by sustained diversification and expanding exports,” said the IMF in its latest statement on the country.

  Inflation is expected to remain subdued in 2025, averaging 1.6% – down from an April 2025 IMF estimate of 2.1% – and to hover around 2% in the medium term.

  Housing costs remain the primary source of price pressure and a growing concern for affordability, while prices for tradable goods are expected to remain stable.

  Property market risk

  Concerns over the state of the real estate market are one area where potentially negative assessments hang over the UAE economy.

  These concerns are currently concentrated in Dubai, where soaring prices have outpaced average wage rises and prompted warnings of a possible bubble.

  UBS, in its Global Real Estate Bubble Index 2025 report, has significantly worsened its assessment of risk in the Dubai property market, moving it from 14th to 5th place in its ranking of exposure to a potential market crash.

  The rise in Dubai’s risk assessment was the largest increase of any market since the prior edition of the report, and the overall classification for Dubai was raised from ‘moderate’ to ‘elevated’.

  Property prices in the Dubai housing market have surged about 70% above pre‑pandemic levels in recent years, according to Knight Frank and JLL data, contrasting with more gradual recoveries in other sectors.

  Sales have also shifted towards larger volumes of off‑plan transactions, where prices continue to rise even as growth in ready property prices has levelled off.

  In May 2025, ratings agency Fitch issued an assessment pointing to up to a 15% moderation in prices in H2 2025 through 2026, suggesting the market had reached its peak.

  Future oversupply was the key concern in the report, which expected new construction projects launched between 2023 and 2024 to add about 250,000 units to the market, with a peak of 120,000 handovers in 2026.

  Countering these assessments are arguments that the city’s underlying economic fundamentals and steady population growth will continue to support consistent demand capable of absorbing the expected supply.

  The UAE government is also encouraging net immigration through more flexible residency visa arrangements, which, together with property sale incentive schemes, are expected to continue to drive property demand in the near term.

  Broader momentum

  Other key growth sectors for the UAE include tourism, construction and financial services — all of which continue to support the country’s economic momentum.

  The resilience of the country’s financial markets and capital flows despite recent global and regional shocks remains a positive signal for investors.

  The UAE is also supporting an investor‑friendly environment through agile regulation of fast‑growing areas, including the emerging market for virtual assets.

  This has been complemented by the country’s recent removal from the Financial Action Task Force’s grey list, reflecting the government’s enhanced efforts to regulate and combat irregular financial activity.

  In the background, the UAE government continues to expand its Comprehensive Economic Partnership Agreements (Cepa) with other countries — supporting diversification of the country’s global trade relations and networks.

  Support for the UAE’s resilience is also reflected in a positive trend in the S&P Global Purchasing Managers’ Index (PMI) in September, which saw the non‑oil private sector deliver its best performance in seven months.

  After dipping to a recent low in July, the UAE PMI climbed for two straight months to reach its highest level since February in September — buoyed by a resurgence in new order growth as the economy emerged from the softer summer period.

  Despite a weaker year overall, with new order growth in particular falling to its lowest point in four years in August, UAE business sentiment nevertheless hit a 10‑month high that same month, even as new orders dipped.

  Now, the continuation of overall positive momentum in the index for the second month running suggests that recent concerns, including over geopolitical developments in the region in the form of the Israeli attacks in the Gulf, have been largely shrugged off.

  The government appears to be keeping the country’s fortunes on an even keel despite the choppy global economic backdrop.

  Taken together, the government’s firm stewardship, momentum in financial markets and robust public and private activity across key growth sectors help explain why the country’s growth continues to exceed expectations.

  ALSO READ: Public spending ties the UAE closer together

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  John Bambridge
• 
  Majid Al-Futtaim commits new investments in Saudi and UAE

  7 October 2025

  UAE-based developer Majid Al-Futtaim (MAF) has announced new commercial investments in Saudi Arabia and the UAE.

  The firm said it has signed an agreement with Saudi gigaproject developer Diriyah Company to introduce a Vox Cinemas multiplex and seven retail brands to Diriyah Square, part of the Diriyah project in Riyadh.

  The retail outlets will span approximately 5,534 square metres (sq m), while Vox Cinemas will occupy about 7,632 sq m.

  MAF will bring international brands to Diriyah, including Shiseido, Lululemon, Crate & Barrel, Abercrombie & Fitch, AllSaints, CB2 and Hollister.

  The formal signing took place at Diriyah Company’s headquarters and was attended by Jerry Inzerillo, group CEO of Diriyah Company, and Ahmed Galal Ismail, CEO of MAF Holding.

  In Dubai, MAF also announced plans to launch Ghaf Woods Mall within its Ghaf Woods residential community in Dubailand. 

  According to an official statement, once completed Ghaf Woods Mall will become the 30th mall in MAF’s portfolio and its 19th in the UAE.

  In April this year, MAF revealed plans to develop a mixed-use project in Riyadh at an estimated cost of about SR17.5bn ($4.6bn).

  According to media reports, the development will cover an area of 850,000 sq m and will include residential, commercial, office and entertainment components.

  In the same month, the firm said that it will invest AED5bn ($1.4bn) to upgrade Dubai’s Mall of the Emirates with new retail, dining, wellness and entertainment facilities.

  According to an official statement, the 20,000-square-metre expansion will add 100 new stores.

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  READ THE OCTOBER 2025 MEED BUSINESS REVIEW – click here to view PDF

  Private sector takes on expanded role; Riyadh shifts towards strategic expenditure; MEED’s 2025 power developer ranking

  Distributed to senior decision-makers in the region and around the world, the October 2025 edition of MEED Business Review includes:

  > AGENDA 1: A new dawn for PPPs > AGENDA 2: GCC pushes PPPs to deliver $70bn pipeline > CHINA: China’s Belt and Road initiative surges in Middle East  > TUNISIA: Tunisia’s president faces growing challenge from unions > POWER DEVELOPER RANKING: Acwa Power consolidates power sector dominance > IPPs: GCC enters pivotal year for IPPs > ACQUISITION: Wood takeover could boost Sidara profits > INTERVIEW: SLB strives to boost regional standing  > ALEC: IPO is chance for Alec to showcase its capabilities > SAUDI MARKET FOCUS: Riyadh strives for sustainable growth

  To see previous issues of MEED Business Review, please click here

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  Yasir Iqbal