UAE Law and Practice Contributed by: Brendan Hundt, Dan Feldman, Sam Anastasiou and Saiesh Kamath, King & Spalding LLP
evant emirate utility, regulator and procurement struc- ture. This also affects how capacity risk is allocated. In the UAE, new capacity is usually developed through forward utility planning, procurement and regulated network development, rather than by individual mar- ket participants in response to wholesale power price signals. That makes early alignment with the relevant utility’s demand forecasts and grid plans central to project strategy. Additional demand-side measures are becoming more important to planning. Abu Dhabi’s Demand Side Man- agement and Energy Rationalization Strategy 2030 targets a 22% reduction in electricity consumption and a 32% reduction in water consumption by 2030 against a 2013 baseline, and the UAE National Water and Energy Demand Management Programme targets a 40% reduction in energy demand by 2050. These programmes do not replace supply-side procurement, but they increasingly influence load forecasts, network investment and the treatment of large users. 1.6 Recent Changes in Law or Regulation The most important recent federal development is Federal Decree Law No 11 of 2024 on the Reduction of Climate Change Effects, which was issued in 2024 and became effective in 2025. The law applies to all emitting entities in the UAE, including those based in free zones, and requires them to contribute to reduc- ing emissions in order to achieve climate neutrality through measures such as energy efficiency, clean energy, carbon capture, carbon offsetting and inte- grated waste management. It is particularly relevant to power-sector participants because generation assets, grid infrastructure and large industrial emit- ters are now required to measure the emissions from their operations and may be subject to further obliga- tions to comply with the UAE’s net-zero policies as the implementing regulations and further legislation are developed. As a general principle, the IPP model provides that any adverse cost or schedule conse- quences of changes in law after the date on which the tariffs are fixed is borne by the public sector (typically in the form of the procurer or offtaker), rather than the project company.
A second important development is the continued implementation of Federal Decree Law No 17 of 2022 and Cabinet Resolution No 103 of 2022 on distributed renewable energy connections and penalties. These instruments established a national framework for connecting distributed renewable energy production units to distribution networks and impose administra- tive penalties for non-compliance, including violations of connection requirements, exceeding authorised export levels and conduct affecting network safety and efficiency. The updated competition framework under Federal Decree Law No 36 of 2023, supple- mented by Cabinet Resolution No 3 of 2025, is also relevant to power-sector acquisitions and joint ven- tures because it establishes economic-concentration notification thresholds based on annual sales in the UAE relevant market (AED300 million) or market share (40%). 1.7 Announcements Regarding New Policies The UAE continues to announce policies and pro- jects aimed at diversifying electricity supply, increas- ing clean energy and improving grid resilience. The updated UAE Federal Energy Strategy 2050 targets a tripling of renewable-energy contribution to the grid by 2030, a 30% share of installed clean-energy capacity in the total energy mix and a 32% clean-energy gen- eration contribution by 2030. Individual emirates also have their own clean-energy strategies. Several landmark projects in several of the emirates are helping to achieve this goal. Abu Dhabi’s round- the-clock project – a large-scale solar photovoltaic (PV) and battery energy storage project – is particu- larly significant because it combines 5.2 GW of solar PV capacity with 19 GWh of battery storage, making it the first asset of its kind to provide a steady baseload of 1 GW of clean power 24 hours per day. The round- the-clock project reflects a mindset shift from viewing battery energy storage systems (BESS) as a peripheral technology to treating them as essential procurement to support grid reliability. EWEC and Masdar have also announced a strategic framework (in May 2026) to accelerate more than 30 GW of solar PV capacity and over 8 GW of battery storage in EWEC’s pipeline – EWEC expects solar PV assets that it is procuring to exceed 30 GW by 2035 – in support of Abu Dhabi’s
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