meed-logo

line1 line2 line3
SIGN IN / REGISTER

UAE utilities ramp up capacity procurement

4 October 2024

Abu Dhabi state utility Emirates Water & Electricity Company (Ewec) invited bids for contracts to develop three independent power producer (IPP) projects in rapid succession in the third quarter of 2024.

These projects comprise the 2,500GW Taweelah C combined-cycle gas turbine plant, the 1,500MW Madinat Zayed open-cycle gas turbine project and the 400MW battery energy storage system to be located in Al-Bihouth and Madinat Zayed.

They bring the number of Ewec’s electricity generation IPP projects currently under tender to four, in addition to the 1,500MW Al-Khazna solar photovoltaic (PV) IPP, which it tendered in April.

Ewec also issued the expression of interest notice on 1 October for a contract to develop the emirate’s fifth solar PV IPP, the 1,500MW Al-Zarraf project.

This robust project pipeline implies that the offtaker and developers, investors and contractors bidding for these projects have entered a hectic period compared to the past few years.

Abu Dhabi’s growing IPP pipeline will compete with Saudi Arabia’s equally robust pipeline for developers’ and contractors’ resources over the near to medium term as both states endeavour to meet their 2030 decarbonisation targets.

Abu Dhabi plans to procure 1,400MW of renewable energy capacity annually between 2027 and 2037 and to meet more than 50% of the emirate’s electricity demand from renewable and clean energy sources by 2030. This is expected to rise to 60% by 2035.

It also previously stated that it expects to reach a renewable energy installed capacity of 7,500MW by 2030, or three times its current capacity.

The expiry of power-purchase agreements for several generation assets over the next couple of years and the likelihood of these contracts not being extended also drive Abu Dhabi’s procurement programme for gas-fired capacity.

Dubai has a slightly different strategy. Dubai Electricity & Water Authority (Dewa) has abandoned any plans to procure additional gas-fired capacity in the foreseeable future.

Dubai’s future generation projects will be focused on the Mohammed Bin Rashid Solar Park, which is expected to reach an installed capacity of 5,000MW by 2030.

So far, Dewa has awarded contracts for the first six phases of the project, which have a total combined capacity of 4,600MW.

Further phases are being planned, with the state utility expected to appoint transaction advisers for phase seven, for which the capacity has not yet been made public, next year.

“The volume of projects coming to the market is almost unprecedented,” notes an industry source, who expects that utility developers are starting to be selective when bidding for new contracts regardless of the energy source.

Nuclear capacity

Notably, the UAE’s Federal Authority for Nuclear Regulation announced that the fourth reactor, or Unit 4, of the Barakah nuclear power plant in Abu Dhabi reached commercial operations in early September.

It marks the completion of the $43bn, 5,600MW Barakah 1 project, which was jointly implemented by the UAE’s Emirates Nuclear Energy Corporation (Enec) and South Korea’s Korea Electric Power Corporation (Kepco).

The entire plant reached full commercial operations approximately 16 years after Abu Dhabi first announced the project in 2008 and 12 years after construction works commenced on Unit 1.

The completion of Barakah 1 also implies that the project’s next phase is likely to proceed in earnest.

Hamad Alkaabi, the UAE’s permanent representative to the Austria-based International Atomic Energy Agency, said in July that the UAE government is considering initiating the tendering process for its next nuclear power plant this year.

Apart from the final tendering process decision, the market is also keen to know who will be invited to bid or submit proposals for the contract to implement the nuclear power facility’s next phase.

Washington and Abu Dhabi entered into the bilateral 123 Agreement for peaceful nuclear cooperation in 2009, which could determine to a large extent which companies or countries will be invited to participate in the project’s next phase.

What the rush is about

Ewec has made clear that expiring generation capacities and the need for gas-fired baseload as more renewable energy enters the UAE electricity grid underpin its ambitious capacity procurement pipeline.

Other factors influencing future capacity procurement plans include the UAE’s multibillion-dollar national industrialisation strategy. This strategy involves expanding downstream industries, including clean hydrogen production for both domestic and export use, potentially resulting in an exponential increase in peak demand.

This is in addition to the need to decarbonise while expanding the production of hard-to-abate sectors such as the oil and gas, steel and aluminium industries.

In addition to these demand sources, many believe the UAE’s 2031 National Artificial Intelligence (AI) Strategy is a major contributor to Abu Dhabi’s ongoing generation capacity buildout.

“They need to build power-hungry data centres to support their AI strategy,” notes an executive with an international infrastructure investment firm with offices in Dubai.

The UAE’s AI strategy encompasses deploying AI in priority sectors and “providing the data and infrastructure essential to become a test bed for AI”.

Meeting these and the other stated objectives, in addition to the data sovereignty regulations, has started driving a boom in data centre construction across the UAE.

State-backed enterprises, utilities, banks, logistics, tourism and service industries, and real estate companies have launched or are expected to launch AI programmes to boost productivity and efficiency, in line with the UAE’s 2050 net-zero target and circular carbon economy strategy.

These span industry-specific applications ranging from chatbots and small-language models to generative AI and large-language models, the latter of which require significant data bandwidth and consume enormous amounts of energy.

AI applications in defence and national security are also presumed to be a major component of the overall AI plan. 

“The AI programme is progressing,” notes an Abu Dhabi-based utility executive, confirming a plan to procure 5,000MW of AI-dedicated thermal capacity.

https://image.digitalinsightresearch.in/uploads/NewsArticle/12650258/main.gif
Jennifer Aguinaldo

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

Click here to register
Exclusive from Meed
Related Articles
  • Egypt signs $420m Gabal El-Zeit wind agreements

    10 June 2026

    Egypt has signed agreements worth $420m for the investment, operation and power purchase of the 580MW Gabal El-Zeit wind power complex in the Red Sea region.

    Gabal El-Zeit 1 has a capacity of 240MW, while Gabal El-Zeit 2 and 3 have capacities of 220MW and 120MW, respectively.

    The agreements were signed between Egypt’s New and Renewable Energy Authority (NREA), the Egyptian Electricity Transmission Company (EETC) and Dubai-based Alcazar Energy.

    Under the agreements, Alcazar Energy will invest in, operate and manage the farms through a project company established under Egyptian law.

    The company will be responsible for technical operations, maintenance and efficiency upgrades while maintaining a minimum capacity of 580MW throughout the contract period.

    The Egyptian Electricity Transmission Company will purchase the electricity generated by the plant.

    The agreements follow earlier efforts to privatise the Gabal El-Zeit wind complex, involving a deal with UK-headquartered private equity firm Actis.

    According to the Egyptian government, the project supports the country’s state ownership policy and national energy strategy, which aim to increase the share of renewable energy in the electricity mix to 45%.

    The Gabal El-Zeit area on Egypt’s Red Sea coast is one of the country’s most established wind power development zones. The latest Gabal El-Zeit wind farm was completed in 2014, according to MEED Projects data. Germany’s Siemens Gamesa was the main contractor. 

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17170360/main.jpg
    Mark Dowdall
  • Majid Al-Futtaim awards $545m Ghaf Woods contract to ECC

    10 June 2026

    Majid Al-Futtaim Properties has appointed Engineering Contracting Company (ECC) as the main contractor for the Capria East, Capria West and Maravelle Residences developments at its Ghaf Woods community in Dubai, in a deal valued at AED2bn ($545m).

    The contract covers the construction of one-, two- and three-bedroom apartments and duplex residences across the two Capria clusters.

    The award adds to a series of major construction contracts Majid Al-Futtaim has issued across its Dubai communities in recent years.

    In May, local contractor Al-Sahel Contracting was awarded a AED700m contract for the Distrikt development, also at Ghaf Woods.

    In 2024, Majid Al-Futtaim awarded AED3bn in contracts for its Tilal Al-Ghaf community, appointing Innovo Build to build 94 waterfront villas at Elysian Mansions and United Engineering Construction (Unec) to deliver 130 villas at the Alaya development.

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17170744/main.jpg
    Colin Foreman
  • Saudi Arabia and Turkiye sign railway agreements

    10 June 2026

    Register for MEED’s 14-day trial access 

    Saudi Arabia and Turkiye have signed two memorandums of understanding (MoUs) to strengthen bilateral cooperation in the railway and logistics sectors, advancing Riyadh’s ambitions to become a global logistics hub.

    Transport and Logistics Services Minister Saleh Al-Jasser and Turkish Transport and Infrastructure Minister Abdulkadir Uraloglu signed the agreements at the ministry’s headquarters in Riyadh on 9 June, following ministerial talks held with a high-level Turkish delegation. Transport General Authority president Fawaz Al-Sahli and officials from the kingdom’s transport and logistics sector were also present.

    Agreement scope

    The first MoU covers logistics services and operations, including the exchange of expertise, policies and regulations. The second focuses on railway technologies, signalling and communication systems, railway digitalisation, human capacity development, the localisation of the railway industry and measures to reduce the sector’s environmental impact.

    More broadly, the agreements cover cooperation on railway standards and related innovations, the exchange of expertise on the design, operation and maintenance of rail projects, and engineering, infrastructure and safety standards.

    The two sides will also cooperate on research and development, with provision for joint workforce training through specialist railway academies.

    Riyadh said the agreements will help support its National Strategy for Transport and Logistics Services and Saudi Vision 2030, which seeks to position the kingdom as a logistics bridge connecting three continents.

    Turkish projects

    Turkish contractors have already established themselves as key players in the region’s rail sector. In 2012, Yapi Merkezi secured a $2.1bn contract for work on the Haramain high-speed rail network in Saudi Arabia, while Turkish firms Mapa and Limak are leading the ongoing civil works on Dubai’s $5.5bn Metro Blue Line project as part of a China Railway Rolling Stock Corporation (CRRC) consortium. Turkish consultancy Proyapi Muhendislik ve Musavirlik Anonim Sirketi has also won design contracts for the 111km Kuwait National Rail Road project.

    The agreements signed by Saudi Arabia and Turkiye may also give momentum to longstanding discussions around a rail corridor linking the GCC with Turkiye. The route, which has been discussed for years, has gained renewed impetus in recent months as the effective closure of the Strait of Hormuz has pushed regional governments to accelerate the development of overland trade alternatives.

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

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17169958/main.gif
    Colin Foreman
  • Joint venture tenders Algeria field development contract

    10 June 2026

     

    Register for MEED’s 14-day trial access 

    Hassi Bir Rekaiz Group (GHBR), which operates Algeria’s Hassi Bir Rekaiz field, has issued a tender for phase 2A of the asset’s field development project.

    GHBR is a joint venture of Algeria’s national oil and gas company Sonatrach and Thailand’s national exploration and production company PTTEP.

    The scope of the contract focuses on the “provision of engineering and supervision services”, according to documents published by Sonatrach.

    The tender has been issued with a bid deadline of 16 June 2026.

    In May, GHBR signed a $1.1bn contract for phase two of the Hassi Bir Rekaiz development project.

    The contract was won by a consortium of Egypt’s Petrojet and Italian engineering and contracting company Arkad.

    Petrojet’s portion of the project was estimated to be worth around $600m, and Arkad’s portion was estimated to be worth $500m.

    The contract used the engineering, procurement, construction and commissioning model.

    The scope of the project contract is focused on the construction of a central processing facility (CPF) capable of processing crude oil and associated gas.

    It also includes developing off-plot pipelines, as well as related utilities and infrastructure.

    The CPF will have the capacity to process 32,000 barrels a day (b/d) and will be designed to support future expansions.

    The related infrastructure will include an extensive pipeline network spanning approximately 217 kilometres, as well as a road network.

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

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17163750/main3325.jpg
    Wil Crisp
  • Algeria extends deadline for urea-formaldehyde project

    10 June 2026

     

    Algeria’s national oil and gas company Sonatrach has extended the bid deadline for a project to develop a new concentrated urea-formaldehyde unit in its Arzew industrial zone.

    The latest bid deadline is 15 June.  

    The contract uses the engineering, procurement, construction and commissioning model, and the bid deadline for technical tender submissions was originally set for early April.

    The condensed urea-formaldehyde unit will be located at the CP1-Z facility.

    The CP1-Z facility began operations in 1975 and has a capacity of 152,000 tonnes a year. It produces products including methanol, resin and formol.

    It is a two-phase tender. The first phase is a technical bid submission, and the second phase is a commercial bid submission.

    To be eligible to win this contract, companies must specialise in petrochemical industrial installation projects.

    They also need to have a share capital of at least $7m and more than 15 years of relevant experience.

    The new unit, UFC85, will have the capacity to produce 40,000 metric tonnes of concentrated and condensed urea-formaldehyde annually.

    The project’s scope also includes the development of auxiliary equipment and installations.

    Urea-formaldehyde has a wide range of uses, including the production of laminates, textiles and paper.

    In the wood industry, it is used as a thermosetting adhesive to bond wood to create plywood and particleboard. In agriculture, urea-formaldehyde is widely used as a slow-release fertiliser.

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

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17163657/main.jpg
    Wil Crisp