UAE ramps up decarbonisation of water sector

10 October 2023

This package on the UAE's water sector also includes: 

> Dewa signs Hassyan water project agreements
> Petrojet joins Project Wave contractor team
> Project Wave first phase reaches financial close

> Alpha Dhabi acquires majority stake in Metito
> Hatta reservoir nears completion
> Sharjah moves Hamriyah bid deadline


 

As a water-scarce country, the UAE has relied on non-conventional water, particularly seawater treated in desalination plants, to meet rising demand.

Over the past decade, the energy-intensive water treatment process, especially when using older technologies, has been a key focus for policymakers tasked with aligning industries with the country’s energy diversification and, more recently, net-zero carbon dioxide emissions agendas.

Decarbonising the water supply has entailed decoupling power and water production and improving the level of treated sewage effluent (TSE) reuse. Other initiatives involve modernising the water pipeline transmission network and tapping renewable energy to power desalination plants.

Demand management initiatives such as tariff reforms and awareness campaigns to make end users conscious of their consumption have also been put in place.

The past few months have marked several milestones in the country’s plan to decarbonise its water sector.

Two private water desalination plants that use reverse osmosis technology to treat seawater are in the final commissioning stage, expanding the UAE’s water production capacity from more energy-efficient plants.

These are the 200 million-imperial-gallon-a-day (MIGD) seawater reverse osmosis (SWRO) plant in Taweela in Abu Dhabi and another plant in Umm al-Quwain, which has a capacity of 150MIGD.

Abu Dhabi’s second major SWRO project, the 120MIGD Mirfa 2 independent water producer (IWP), also reached financial close this year.

Crucially, Abu Dhabi dismantled the thermal-powered Taweelah A2 independent water and power producer (IWPP) plant last year, following the expiry of its long-term offtake contract. The plant’s desalination unit ran on the older multi-stage flash technology.

Hassyan 1 

Dubai achieved an important milestone in October when state utility Dubai Electricity & Water Authority (Dewa) and Saudi-headquartered Acwa Power signed a 30-year water-purchase agreement (WPA) and shareholder agreement for the Hassyan 1 IWP project.

Acwa Power will develop and operate the power plant for 30 years at a levelised water cost of 36.5 $cents a cubic metre, a record low, although not nearly as low as the tariff proposed by another developer when the contract was first tendered.

The project supports Dewa’s plan to increase its water desalination capacity from 490MIGD to 750MIGD by the end of the decade.

Dewa has said the Hassyan 1 IWP will be powered by solar energy, further reducing the plant’s carbon footprint.

In Abu Dhabi, the official signing of a WPA for the Shuweihat S4 SWRO project is imminent, which will add another 70MIGD  to the emirate’s installed water production capacity once complete.

The Shuweihat 4 plant will cater to potable water demand in Abu Dhabi’s Al-Dhafra region, a key focus of Abu Dhabi’s economic development plan.

The bidding process is also under way for two more SWRO plants in Abu Dhabi. The Hudayriat and Saadiyat RO plants, each with a capacity of 50MIGD, will be developed as one IWP contract.

Emirates Water & Electricity Company (Ewec) has not mandated the inclusion of a solar photovoltaic (PV) plant for its most recent IWP projects, as it did for the Taweelah RO plant in 2019. However, it will likely tap either solar or nuclear energy, or both, for its upcoming SWRO plants in line with its goal to halve its total carbon dioxide emissions to 22 million tonnes a year by 2035.

The northern Sharjah emirate is also procuring its first IWP. The planned Hamriyah SWRO plant will have a capacity of 90MIGD.

In addition to the utility clients, Abu Dhabi National Oil Company (Adnoc) has awarded the contract to develop the first phase of Project Wave, which aims to replace the aquifer water injection systems used to maintain reservoir pressure in Abu Dhabi's onshore oil fields.

The project is expected to reduce the water injection-related energy consumption of the oil fields by up to 30 per cent.

Wastewater

Dubai Municipality activated a major programme this year to develop deep tunnels and sewage treatment plants across the emirate. This long-term project could require an investment of up to AED80bn ($22bn).

Known as the Deep Tunnels Portfolio, the scheme will be developed as a public-private partnership (PPP) initiative and will expand the role of private companies in the emirate’s water infrastructure sector.  

It involves the construction of two sets of deep tunnels terminating at two terminal pump stations located at sewerage treatment plants (STPs) in Warsan and Jebel Ali. A conventional sewage and drainage collection system and STPs will be built in Hatta. The scheme also includes recycled water distribution systems connected to the STPs.

Approved by Dubai’s Executive Council in June, the project has been designed to serve the needs of the Dubai population for the next 100 years in alignment with the Dubai Economic Agenda D33 and Dubai Urban Plan 2040.

In the UAE capital, Abu Dhabi Sustainable Water Solutions, formerly Abu Dhabi Sewerage Services Company, received bids for the contract to design, build and operate a planned TSE polishing plant in Al-Wathba earlier this year.

The plant is expected to have a design capacity of 700,000 cubic metres a day (cm/d), with the potential to expand this to 950,000 cm/d in a subsequent phase. The TSE facility will produce water for higher-end applications compared with TSE produced in a standard sewage treatment plant.

In addition to supporting the UAE’s long-term economic and demographic expansion, these water treatment projects also boost the country’s preferred circular carbon economy approach to energy transition.

https://image.digitalinsightresearch.in/uploads/NewsArticle/11193002/main.gif
Jennifer Aguinaldo
Related Articles
  • Dubai property bubble risk rises as price growth stalls

    25 September 2026

    Register for MEED’s 14-day trial access 

    Dubai’s residential property market remains in elevated bubble-risk territory after a sharp slowdown in price growth, according to UBS.

    The emirate’s housing boom came to an abrupt halt at the onset of the regional conflict, the Swiss bank said in its Global Real Estate Bubble Index 2026 report. Inflation-adjusted house prices have fallen back to mid-2025 levels, after real growth of more than 10% in 2025.

    Dubai scored 1.16 on the index, up on last year, placing it fourth among the 23 cities covered. Only Zurich and Tokyo, at 1.69 and 1.54 respectively, are classed as high risk. Miami, Seoul, Geneva and Lisbon join Dubai in the elevated category, which covers scores between 1.0 and 1.5.

    Real prices in Dubai rose by 0.4% in the year to Q2 2026, while real rents fell by 4%. UBS said bubble risk remained elevated despite some easing since March.

    Ownership costs

    UBS said existing tenants were likely to take advantage of the pause in price growth and, in some cases, price concessions to buy homes. Despite elevated mortgage rates, Dubai remains one of the few markets where ownership is relatively attractive given the high cost of renting, according to the bank.

    A skilled service worker in Dubai needs about five years of average income to buy a 60-square-metre apartment near the city centre, compared with about 15 years in Hong Kong and 11 years in London. It takes 16 years of rent to pay for an equivalent apartment, one of the lowest ratios in the study. UBS attributed the low price-to-rent ratios in Dubai, Sao Paulo and the US cities surveyed to less regulated rental markets and higher interest rates, as well as elevated risk premiums in Dubai and Sao Paulo.

    The bank said uncertainty over whether the inflow of high-income earners would recover was weighing on the premium segment. It added that Dubai’s structural advantages, including its strategic location and its appeal as an international business hub, remained intact, and that an improvement in the geopolitical environment was likely to support a rapid recovery in market sentiment and price expectations.

    Supply is a further source of uncertainty. Some developments have stalled, and others may be delivered later than planned, although UBS said the market remained exposed to heightened volatility because of persistent concerns about structural oversupply.

    Global slowdown

    Across the cities analysed, real residential prices rose by an average of 0.5% in the year, down from 1.4% in mid-2025. Seoul recorded the strongest real growth, at 11%, while Toronto and Vancouver fell by about 10%.

    The report also points to Gulf capital supporting other markets. UBS said interest from Middle Eastern buyers could further lift prices in Geneva, and that investors from the Middle East, the US and Asia had supported London’s prime segment.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19987757/main.jpg
    Colin Foreman
  • UAE vehicle manufacturing push moves into production

    25 September 2026

     

    Register for MEED’s 14-day trial access 

    Chinese-linked carmaker Rox has begun vehicle production at Khalifa Economic Zones Abu Dhabi (Kezad). The start-up represents the most significant output so far from the UAE’s efforts to build an automotive manufacturing industry.

    The first three Rox Adamas vehicles, carrying the Made in the Emirates mark, came off the production line at the company’s new Abu Dhabi facility in early September. The 10,000-square-metre plant is expected to reach an initial capacity of 20,000 vehicles a year by 2027, rising to 300,000 vehicles a year by 2030.

    The facility can sub-assemble more than 80 types of vehicle components and also carries out complete vehicle assembly, calibration, rain and road testing, and final inspection. Rox moved its global headquarters to the UAE last year and plans to supply local and export markets.

    The project forms part of Rox’s partnership with the Abu Dhabi Investment Office (Adio) and is supported by the UAE Ministry of Industry & Advanced Technology. Kezad Group signed the lease agreement for the facility in May.

    Programme targets

    The Rox plant is the first major output of a state-led strategy that has gathered pace over the past 18 months. Adio launched its automotive programme at the Make it in the Emirates forum in May 2025, with the aim of creating a hub for vehicle manufacturing and assembly, research and development, restoration, auctions and luxury cars.

    The programme is projected to contribute AED100bn ($27.2bn) to Abu Dhabi’s GDP by 2045, attract more than AED8bn ($2.2bn) in foreign direct investment and create 7,000 skilled jobs. Adio has also introduced an automotive artificial intelligence curriculum with universities to develop Emirati talent in the sector.

    In October last year, Adio and AD Ports Group agreed to work with Netherlands-based Stellantis to develop the emirate’s automotive ecosystem. The memorandum of understanding covers expansion into Middle East and Africa markets, an ecosystem for autonomous taxi services, and research into next-generation mobility technologies.

    Under the agreement, Stellantis will explore investment opportunities in Abu Dhabi, while Adio and AD Ports Group will provide market intelligence and logistics support. The announcements did not include a commitment to build a production facility.

    Kezad already hosts smaller electric vehicle (EV) operations. In 2024, UAE-headquartered NWTN signed a lease for a Kezad facility with capacity to assemble 5,000-10,000 semi-knocked-down EVs a year, with plans to expand to 50,000 units in a second phase.

    Trading hub

    Dubai has focused on vehicle trade rather than manufacturing. In November last year, Dubai Municipality signed a partnership agreement with DP World’s Economic Zones division to establish and manage the Dubai Auto Market, a 22 million-square-foot complex with more than 1,500 showrooms that is designed to handle over 800,000 new and used vehicles a year.

    Enabling works are under way, carried out by local contractor Rad International Road Construction, with US-based Aecom serving as project consultant. Sheikh Maktoum Bin Mohammed Bin Rashid Al-Maktoum, first deputy ruler of Dubai, said at the launch that the project would foster a cluster of light industries for vehicle assembly and trade.

    The market builds on an established base. Jebel Ali Free Zone hosts more than 940 automotive and spare-parts companies, including Ford, General Motors, Honda, Hyundai, Nissan and Volkswagen. In 2022, M Glory Group laid the foundation stone for a AED1.5bn ($408m) EV plant at Dubai Industrial City, with a planned capacity of 55,000 cars a year.

    Regional competition

    The UAE is not alone in pursuing automotive manufacturing. In Saudi Arabia, the Public Investment Fund (PIF) owns 70% of Hyundai Motor Manufacturing Middle East, which will roll out its first vehicle by Q4 2026 and targets annual production of 50,000 vehicles. Ceer, the kingdom’s first EV manufacturer, intends to roll its first vehicle off the production line in late 2026.

    Saudi Arabia’s National Industrial Strategy aims to attract three to four manufacturers capable of producing more than 300,000 vehicles a year within a single automotive cluster. In Qatar, JTA International Investment Holding said last month that it was working with the UK’s Watt Electric Vehicle Company to set up a factory.

    The two leading Gulf economies are taking different approaches. Saudi Arabia has relied on direct PIF shareholdings in manufacturers. In the UAE, investment offices, port groups and economic zone operators have led the effort, using land, logistics and incentives to attract privately owned carmakers.

    Scaling up is the next test. Rox’s plan to increase output fifteen-fold between 2027 and 2030 will show whether Abu Dhabi’s model can support volume manufacturing. Achieving it would give the UAE production capacity comparable to the level Saudi Arabia is targeting across its entire automotive cluster.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19986887/main.jpeg
    Colin Foreman
  • SAR prepares phosphate rail second section contract award

    25 September 2026

     

    Saudi Arabian Railways (SAR) is preparing to formally award another multibillion-riyal contract to double the tracks on the existing phosphate transport railway network connecting the Waad Al-Shamal mines to Ras Al-Khair in the kingdom’s Eastern Province.

    The contract covers construction works on the second section of the railway line, spanning more than 150 kilometres (km).

    The scope of work includes civil works, alignment modifications, track and loop construction, and associated infrastructure such as bridges and culverts, as well as enhancements to signalling and telecommunications systems.

    SAR floated the tender in February, and bids were submitted in April.

    SAR is making significant progress on its Phosphate 3 rail programme. Last month, MEED exclusively reported that SAR had awarded an estimated SR4bn-plus ($1.1bn) contract to add another track to the first section of the existing phosphate transport railway network.

    The contract was awarded to local firm Alomaier Trading & Contracting Company.

    The scope includes track doubling, alignment modifications, utility bridges, culvert widening and hydrological structures, as well as the conversion of the AZ1 siding into a mainline track. It also covers support works for signalling and telecommunications systems.

    The existing railway runs from the Waad Al-Shamal mines to Ras Al-Khair. The first-section works will cover about 100km, connecting the AZ1/Nariyah Yard to Ras Al-Khair.

    Switzerland-based engineering firm ARX is the project consultant.

    Formerly known as the North-South Railway, the North Train is a 1,550km freight line running from the phosphate and bauxite mines in the far north of the kingdom to the Al-Baithah junction. From there, it diverges into a line south to Riyadh and another line east to downstream fertiliser production and alumina refining facilities at Ras Al-Khair on the Gulf coast.

    Adding a second track and freight yards will significantly increase the network’s cargo-carrying capacity and support growth in industrial production. Project implementation is expected to take four years.

    State-owned SAR is also considering increasing the localisation of railway materials and equipment, including developing a cement sleeper manufacturing facility.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19983928/main.jpg
    Yasir Iqbal
  • Meraas awards $272m Nad Al-Sheba Gardens villas deal

    25 September 2026

    Dubai-based real estate developer Meraas Holding, part of Dubai Holding, has awarded a AED1bn ($272m) contract for the construction of the seventh phase of the Nad Al-Sheba Gardens community.

    The contract, which covers the delivery of 272 villas and townhouses, was awarded to local firm GCC Contracting.

    The scope of work includes 130 villas, 142 three-bedroom townhouses, and associated utilities and infrastructure.

    Construction has started, and the project is slated for completion in 2028.

    Last year, Meraas awarded a AED690m ($188m) contract for the construction of the fourth phase of the Nad Al-Sheba Gardens community in Dubai.

    Meraas awarded the contract to local firm Bhatia General Contracting.

    The scope of that contract covers the construction of 92 townhouses, 96 villas and two pool houses.

    In December last year, Meraas announced the eleventh and final phase of its Nad Al-Sheba Gardens residential community. This phase includes the development of 210 new villas and townhouses, as well as a school, located in the northwest corner of the development.

    According to UK analytics firm GlobalData, the UAE’s construction industry will register annual growth of 3.9% between 2025 and 2027, supported by investments in infrastructure, renewable energy, oil and gas, housing, industrial and tourism projects.

    The residential construction sector is expected to record an average annual growth rate of 2.7% between 2025 and 2028, supported by private investment in residential housing, along with government initiatives to meet rising demand.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19983032/main.png
    Yasir Iqbal
  • KBR opens new office in Libya

    25 September 2026

     

    US-based KBR has opened a local branch office in Libya as it seeks to expand operations in the country, according to industry sources.

    The local branch opening follows several significant contract wins in the country.

    In March, KBR announced that it had been awarded a contract by Zallaf Exploration, Production & Refining of Oil & Gas Company to provide project management and technical services for the South Refinery Project in Libya’s southern city of Ubari.

    Under the terms of the contract, KBR will provide contract management, project management and supporting technical services throughout the engineering, procurement and construction (EPC) phases of the project, according to a company statement.

    The EPC work is expected to be executed over a 50-month period.

    In its statement, KBR said that the project was aligned with its “long-standing commitment to advancing vital oil and gas infrastructure in Libya”.

    KBR is currently re-evaluating the front-end engineering and design (feed) for the project to develop the J6 North Gialo field in Libya.

    In February this year, KBR officials said registration procedures to open a local branch were being finalised and that the company was seeking the necessary operating permits.

    KBR has previously provided engineering services for major national projects in Libya, but was forced to shut down its office in the country several times amid political instability and security issues.

    When the company was known as Brown & Root, it worked on the Great Man-Made River Project in Libya, which is widely recognised as the largest irrigation project in the world.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19981331/main.png
    Wil Crisp