UAE Power Mix Will Continue To Be Dominated By Thermal Power In Next Decade, Says Globaldata

The United Arab Emirates is aiming to become self-sufficient in gas supply by 2030 following the discovery of more onshore hydrocarbon reserves, latest report by GlobalData suggests.

Currently, the country is dependent on gas imports for power plants and water desalination plants.

As of 2023, thermal power generation comprised around 77.7% of the total power generation mix of the country.

GlobalData’s latest report, “UAE Power Market Size, Trends, Regulations, Competitive Landscape and Forecast, 2024-2035,” reveals that the installed capacity share of thermal power in the UAE was around 80.4% in 2023, where gas-based thermal power capacity dominated the power capacity mix with a share of 80.2%.

Sudeshna Sarmah, Power Analyst at GlobalData, comments: “With the discovery of new hydrocarbon reserves, the UAE is planning to invest heavily in hydrocarbon infrastructure and seek to develop new production techniques. At present, the country is in the process of choosing new locations to set up new infrastructure and seeking unconventional methods for hydrocarbon production.”

By 2035, it is anticipated that the cumulative thermal power capacity will expand to 46.1 GW, up from 41.2 GW in 2023, increasing at a compound annual growth rate (CAGR) of 0.9% during the forecast period.

Correspondingly, annual generation from thermal power sources is projected to increase from 135.5 TWh in 2023 to 155.9 TWh in 2035, at a CAGR of 1.2%.

Sarmah adds: “Most of the increase in capacity is expected in gas-based thermal power rather than oil, whose capacity is expected to remain almost unchanged. The increase in gas capacity provides a potential opportunity to industry stakeholders which include gas turbine manufacturers, ancillary equipment suppliers, developers, operators, and EPC contractors.”

Sarmah concludes: “Since 1971, the UAE has relied on its large oil and natural gas resources to support its economy. Rapid economic and demographic growth over the past decade has pushed the UAE’s electricity grid to its limits. The UAE is planning to add nuclear, renewable, and coal–fired electricity generating capacity to accommodate rising demand.

Despite the UAE’s vast resource potential for renewables (particularly solar), only small progress has been made in the direction of harnessing renewable energy resources.”

Source: https://energynewsafrica.com