meed-logo

line1 line2 line3
SIGN IN / REGISTER

Abu Dhabi and Riyadh compete for capacity

24 March 2025

Electricity generation installed capacity from renewable and nuclear energy sources is expected to overtake conventional installed capacity in Abu Dhabi by 2029.

Based on known projects that are under various stages of procurement and in line with a plan to procure 1.5GW of renewable capacity annually until the mid-2030s, as well as an assumption that the contracts for thermal capacities expiring between 2025 and 2029 will not be renewed, the UAE capital could see its total electricity generation installed capacity rise to approximately 38.5GW by 2029, up from around 22GW as of the end of 2024.

This figure includes the 5.2GW capacity from the solar photovoltaic (PV) project being built by Abu Dhabi Future Energy Company (Masdar), which is expected to come on stream in 2027. The project will supply up to 1GW of baseload capacity in tandem with a 19 gigawatt-hour battery energy storage system plant.

By 2029, the share of renewable energy is expected to reach 37% and nuclear energy 14% of total installed capacity. Capacity from gas-fired fleets is forecast to be 49%, down from 69% this year.

This scenario assumes that all projects under procurement and construction achieve commercial operations according to their timeline, that all four gas-fired fleets with a combined expiring capacity of 7.2GW are not extended, and that another 1.5GW solar PV project will be launched next year, following the Al-Zarraf solar IPP.

This further implies that at least 1.5GW of renewable energy capacity will start operating annually from 2026, and planned gas-fired power plants will be completed successively between 2027 and 2029. It precludes the launch of new thermal power projects apart from those already known or announced.

This massive capacity buildout, equivalent to between 16GW or 70% and 21GW or 94%, if the round-the-clock solar capacity is included, of its current installed capacity, requires Abu Dhabi to rapidly upgrade its grid infrastructure and deploy substantial battery energy storage capacity to ensure grid resilience and flexibility.

Competing for capacity

It also tests the capacity of developers and engineering, procurement and construction (EPC) contractors, which are equally beholden to pursue new contracts in Saudi Arabia.

The kingdom faces a pending deadline to decommission ageing liquid fuel-fired plants as part of an overall energy transition plan for its electricity sector. It aspires to procure 20GW of renewable energy capacity annually until 2030 "subject to demand growth", and have renewable sources account for half its electricity generation capacity at the end of the forecast period.

According to MEED Projects and MEED data, Saudi Arabia entered what could be the busiest period for power generation capacity buildout in its history this year, with over 50GW of power generation projects under construction, or about to start construction.

This is equivalent to over a quarter of its current installed capacity, which will also require a 60% expansion of its electricity grid coverage. 

Related reads: 

The scale and volume of contracts in both jurisdictions are a positive development for many developers and contractors, following a major slowdown in the years before and after the Covid-19 pandemic.

Even those extremely cautious about solar PV projects' ability to deliver desired profits, or those obliged to say no to thermal projects that do not offer a clear carbon capture path, can pivot to the rapidly expanding battery energy storage projects or, indeed, the potential hydropower projects in Neom in Saudi Arabia.

Retreating bidders 

It must be noted, however, that several international utility developers are shifting their geographical focus away from the region and have expressed a desire not to compete in the upcoming tenders for power generation projects.

As a result, the latest tenders in Riyadh and Abu Dhabi generally received fewer-than-expected bids. This trend may continue due to distinct factors affecting each fuel type.

“The volume of utility-scale gas projects is outstripping the availability of credible developers,” notes a senior executive with an advisory firm in the UAE. “Either they are already overloaded, withdrawing from the gas market, or uninterested in a particular country.”

Another key issue for developers and EPC contractors, regardless of the location of these projects, is the gas turbine original equipment manufacturer (OEM) gridlock, which affects delivery time and prices.

In general, top OEM manufacturers are caught between two choices: expand their capacity to accommodate rising demand and secure substantial cash flow going forward, or ignore the short to medium-term demand and eliminate the risk of building capacity that may be stranded beyond 2030, when clients may stop procuring new gas utility plants.

On the other hand, interest in renewables may remain intact, subject to improving returns prospects, another expert tells MEED.

Nonetheless, these developments translate to significant opportunities, particularly for local developers, EPC contractors and other OEM manufacturers – such as Italy's Ansaldo Energia – which have remained on the fringes of the region's utility power projects markets for many years.

Chinese firms that previously only focused on EPC, for instance, are gradually stepping up to the role of utility developers, which can help ensure that the region's offtakers continue to secure world-record-low tariffs for future projects.

This, however, may also seal the decisions by more established developers to exit the region for good.

https://image.digitalinsightresearch.in/uploads/NewsArticle/13526524/main.jpg
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • What actually slows a gigaproject down

    9 September 2026

     

    Ask anyone delivering a major programme in the GCC what causes delays and sequencing will come up early. Utilities go in too late. Approvals lag behind construction. Stations, depots and access roads are procured as if they belong to different projects rather than one system.

    “None of this is new. The industry has understood these risks for years,” says Alan Caldwell, managing director for transport and infrastructure at WSP Middle East.

    For Caldwell, that is what makes the pattern worth interrogating rather than simply restating.

    “The more important question is why the same issues around interfaces, approvals, stakeholder alignment and delivery sequencing continue to slow major programmes when the risks are already so well understood,” he says.

    The answer, he argues, is not that these programmes are too big or too technically complex. What breaks a schedule is a wider system delivered as a set of disconnected parts; an approval sitting with an authority team with no visibility of the construction sequence downstream; or a station package proceeding without the utilities diversion it depends on.

    “Infrastructure programmes do not struggle because a railway is too large or a highway network is too complex,” Caldwell says. “They encounter difficulties when interconnected elements are delivered in the wrong order.”

    Sequencing decisions are rarely purely technical either, he adds. They are commercial – shaped by which assets need to unlock value first, which phases are tied to funding, and where sales or investment assumptions depend on infrastructure landing in a particular order.

    Approvals sit at the centre of that logic. On many programmes, they become one of the biggest sources of lost time – not because the requirements are unreasonable, but because approvals are not planned, evidenced or owned as part of the delivery logic from day one.

    Caldwell has seen the same pattern across three decades of Gulf delivery, from early work on Palm Jumeirah to today’s region-wide transport programmes.

    “The decisive factor has often been the same: whether interfaces, approvals, responsibilities and delivery sequencing are aligned early enough to prevent complexity becoming delay.”

    Integration needs to be well understood

    “Most programme teams in the region would say they understand the need for integration,” Caldwell says. Fewer are structured to deliver it. “The harder task is turning that understanding into the way projects are actually set up and managed,” he argues.

    Riyadh Metro is the reference point he returns to, precisely because engineering complexity was not the deciding factor in its delivery.

    Coordinating a city-scale transport system meant aligning design, construction, systems, utilities and stakeholder interfaces across every delivery vertical.

    “The lesson for the region today is clear,” Caldwell says. “Ambitious programmes need a delivery model that gives every contributor a shared view of progress, risk, decision-making and the business case driving programme priorities.”

    That shared view, he argues, will be what the next phase of Gulf delivery is judged on.

    Whether clients, consultants, contractors, operators and approval authorities can work to a single delivery logic will be key.

    “This requires more than coordination meetings. It requires integrated ways of working, shared common data environments and governance structures that make risks, decisions and dependencies visible before they become delays,” he says.

    From reporting progress to managing risk before it lands

    Digital tools have a role here, Caldwell says, but not as a headline in themselves.

    Digital twins, programme visualisation and data-led modelling matter only if they help teams identify and address problems before they affect the wider programme.

    “The real value is not technology for its own sake,” he says. “It is the ability to see, in one place, where approvals are outstanding, where interfaces are unresolved, where programme dates are slipping, where clashes are emerging and where decisions need to be escalated."

    None of it works without governance behind it, he cautions. “A dashboard will not resolve a delayed approval if nobody knows who owns the decision, when it needs to be made, or how it should be escalated.”

    Data only has value if the processes and responsibilities around it are clear, which is why Caldwell frames the shift the region needs not as digitisation, but as a move “from programme management as a discipline focused mainly on reporting and coordination, and towards project and programme intelligence”.

    With many of the region’s programmes running for a decade or more, he adds, delivery models also need to flex as funding assumptions, user needs and policy priorities change along the way.

    “The ambition behind the Gulf’s transformation programmes is not in question,” Caldwell says.

    What will determine how much of it is realised on time is whether delivery models evolve at the same pace: earlier integration, clearer approval pathways, shared data environments, and every contributor working to a delivery logic that connects technical sequencing with the funding and operational case behind it.

    “The region’s next challenge is not imagining bigger projects,” he says. “It is changing the way they are delivered, operated and adapted over time.”

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19502016/main.gif
    Yasir Iqbal
  • Jordan tenders advisory for wastewater treatment plant

    9 September 2026

    The Water Authority Jordan (WAJ) has issued an invitation to prequalify for advisory services for the rehabilitation and expansion of the Shallala wastewater treatment plant in Irbid, northern Jordan.

    The Shallala plant was commissioned in 2013 with a design capacity of about 14,000 cubic metres a day (cm/d).

    The rehabilitation and expansion project will increase its treatment capacity to about 30,500 cm/d to meet projected wastewater flows through 2050.

    The PIU Support and Construction Supervision Consultancy Services tender was released on 19 August.

    The submission deadline is 21 September.

    The consultancy will support the project implementation unit and provide construction supervision services for the project. The project has an estimated value of $69m and is being financed by the European Bank for Reconstruction and Development.

    The planned works include rehabilitating the existing activated sludge and treatment units and constructing a new treatment train.

    The scope also includes installing biogas combined heat and power units, improving sludge handling and dewatering systems, and installing odour control and chemical containment systems.

    WAJ is also undertaking the upgrade and expansion of the Ain Ghazal wastewater treatment plant in Amman.

    The existing facility had a capacity of 330,000 cm/d and is being upgraded to 726,712 cm/d to accept and treat expected incoming flows until 2045.

    The local Arab Towers Contracting Company was appointed as the main contractor for the project last year.

    READ THE SEPTEMBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19498520/main.jpg
    Mark Dowdall
  • Consultants bid for Abu Dhabi light rail project management

    9 September 2026

     

    Abu Dhabi Transport Company (ADTC) has issued a request for prequalification (RFQ) notice to consultants for a contract for project management engineering consultancy services for the first phase of the light rail transit network, also known as ADT4.

    The notice was issued on 7 September, with a submission deadline of 9 November.

    The project’s first phase will span 19 kilometres (km) and include 23 stations, connecting Zayed International airport (AUH) with nearby areas, including Yas Island, Al‑Raha Beach and Khalifa City.

    The key sections of the tram are:

    AUH to Yas Island: The tram will start from Terminal A at AUH and run through the Yas tunnel to Yas Gateway Park. It will serve areas including Yas Bay, Media Zone, Yas Plaza, Yas Drive, Yas Mall, Sea World and Water Edge.

    This section covers 13km and includes 13 at-grade stations and one underground station.

    Al-Raha: This section will stretch for 4.3km and run along Al-Raha Street. It will serve areas including Al-Zeina, Al-Muneera and Al-Bandar, towards the Aldar head office. The section will include seven at-grade stations.

    Etihad Plaza: This section will pass the Etihad Aviation Training Centre and span about 1.7km. It will feature a main depot near the Etihad Airways headquarters, along with two at-grade stations.

    The tender also covers the procurement of 25 trams, each with a capacity of 270 people, along with associated systems.

    The project was officially launched at the GlobalRail exhibition in Abu Dhabi in October last year.

    Referred to as Abu Dhabi Tram Line 4, the project will be delivered in three phases.

    Construction of the first phase is expected to start next year. The tram is slated to begin operations by 2030.

    Future phases will extend towards Khalifa City and serve additional destinations across Yas Island.

    The project forms a key part of the recently announced AED170bn ($46bn) package of national transport and road projects to be implemented by 2030.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19493532/main.jpg
    Yasir Iqbal
  • Medina’s KEC signs real estate project development deal

    9 September 2026

    Medina’s Knowledge Economic City (KEC) has signed an agreement with Riyadh-based Kaden Investment Company to develop a mixed-use project in Medina.

    The project will have an estimated gross floor area of about 230,000 square metres (sq m).

    According to a statement filed by KEC with the Saudi Exchange (Tadawul), the project – called Multaqa Al-Madinah 2 – will be built on a 92,000 sq m plot located directly north of the first phase of the Multaqa Al-Madinah development.

    It is expected to include about 1,527 residential units across three residential zones, along with commercial and office space totalling about 31,108 sq m of net leasable area.

    It will also feature parking, recreational and service facilities, landscaping and other supporting infrastructure.

    KEC and Kaden intend to deliver the project through a closed-ended real estate investment fund regulated by Saudi Arabia’s Capital Market Authority.

    Under the proposed structure, KEC will contribute the land as an in-kind contribution and hold 75% of the fund units, while Kaden will contribute cash and hold the remaining 25%.

    Kaden will also serve as the development manager.

    KEC said the land has been initially valued at about SR692.3m ($184.6m), while the total equity required for the project is estimated at around SR833m.

    Once final agreements are signed, KEC expects to receive SR67.7m in cash and fund units valued at approximately SR624.6m.

    READ THE SEPTEMBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19492407/main.png
    Yasir Iqbal
  • Morocco signs agreement for synthetic fuel complex

    9 September 2026

    Switzerland-based Synhelion has signed an agreement with the Government of Morocco with the aim of developing a large-scale commercial synthetic fuel plant in the country’s southern Tan-Tan province.

    The memorandum of understanding (MoU) relates to a facility with the capacity to produce 100,000 tonnes a year of fuel, according to a statement released by the company.

    Synhelion has secured land for the project site and established a subsidiary in Morocco to develop the fuel complex.

    Gianluca Ambrosetti, one of Synhelion’s co-chief executives, said: “Morocco’s exceptional renewable energy resources and its clear industrial strategy make it an ideal location for scaling our synthetic fuel technology.

    “With the MoU signed, the land reservation secured and our branch in place, we are moving from evaluation to execution and toward our first commercial-scale plant in the region.”

    Synhelion specialises in producing hydrocarbon fuels using renewable energy. Its products include synthetic jet fuel, gasoline and diesel.

    READ THE SEPTEMBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19489903/main.jpg
    Wil Crisp