Renewable Energy Prospects: United Arab Emirates

April 2015

Renewable energy has become economically attractive in the oil-rich United Arab Emirates (UAE). Ramping up renewables to 10% of the country’s total energy mix, and 25% of total power generation, could generate annual savings of USD 1.9 billion by 2030 through avoidance of fossil-fuel consumption and lower energy costs. With health and environmental benefits factored in, the transition to renewables could generate additional net annual savings of USD 1 billion to as much as USD 3.7 billion by 2030.

This report is a joint effort of the International Renewable Energy Agency (IRENA), the UAE-based Masdar Institute, and the UAE Ministry of Foreign Affairs’ Directorate of Energy and Climate Change. The analysis of the UAE’s renewable energy prospects comes as part of REmap 2030, IRENA’s roadmap for doubling the share of renewables in the global energy mix.

Since 2010, rising natural gas prices in the UAE have combined with rapidly falling technology costs for solar photovoltaic (PV) systems, in particular. This has made renewables a competitive option for power generation in the UAE – an oil exporter, but increasingly an importer of natural gas. Wind power and waste-to-energy conversion have also become economic with natural gas prices above USD 8 per million British thermal units (mBtu). These recent developments create financial reasons for the country to accelerate its renewable energy deployment beyond the existing targets in Abu Dhabi, Dubai and other emirates.

To achieve such rapid scale-up, government agencies must be empowered to take holistic, comparative views of energy costs and to follow through on such views in power-sector regulation and tendering. The Emirate of Dubai’s governance model and the creation of a UAE federal energy policy taskforce are important initial steps.

Full report

Executive Summary

REmap 2030 portal