UAE's New Energy Tariff Scheme Aims To Propel Industrial Expansion

Etihad Water and Electricity Company (EWEC) has started processing applications for a new initiative aimed at enhancing industrial growth in four emirates. The programme offers reduced energy tariffs for industrial and technological businesses in Ras Al Khaimah, Fujairah, Ajman, and Umm Al Qaiwain.

This initiative is a result of the Industrial Development Council, chaired by Dr. Sultan bin Ahmed Al Jaber, Minister of Industry and Advanced Technology. It reflects the strategic collaboration between the Ministry of Industry and Advanced Technology (MoIAT), the Ministry of Energy and Infrastructure (MoEI), and EWEC to improve the business environment and empower manufacturing in these emirates.

Announced during the third Make it in the Emirates Forum in May 2024, the initiative aligns with the UAE’s National Strategy for Industry and Advanced Technology. Its goal is to foster an attractive investment environment, stimulate growth, and support sustainable development in the country.

The programme extends beyond financial savings. By enabling industrial companies to reduce operational and production costs, it promotes greater price competitiveness in both domestic and international markets. This encourages the development of industrial projects in Ras Al Khaimah, Fujairah, Ajman, and Umm Al Qaiwain.

The new system offers additional incentives, including flexible fees for installation and network connection services. Customers can choose to incorporate these fees into their monthly consumption payments or pay upfront with a 20 percent discount compared to traditional installation fees. Additionally, customers in this tier are exempt from insurance fees and incur no extra costs or additional fees for meter usage.

Support from Key Figures

Omar Al Suwaidi, Under-Secretary of MoIAT, said, "The Ministry of Industry and Advanced Technology, in collaboration with partners from the public and private sectors, is focused on boosting the growth of the industrial sector and enhancing in-country value." He added that this supports local manufacturing competitiveness.

Sharif Al Olama, Under-Secretary for Energy and Petroleum Affairs at MoEI, noted that the new tariff structure aims to promote sustainable development. "Through this initiative, we aim to enable customers in the industrial and technological sectors to benefit from competitive energy prices," he said.

Sustainability Efforts

The initiative complements broader sustainability agendas like the Industrial Decarbonisation Roadmap launched at COP28. It aligns with the UAE Net Zero by 2050 Strategic Initiative. The Federal Energy Management Regulation in Industrial Facilities aims to improve operational excellence in managing energy systems.

This regulation promotes best practices that reduce consumption, enhance emission reductions, and lower energy bills for manufacturers. The third edition of the Make it in the Emirates Forum included a panel discussion on this regulation focused on sustainability within the industry.

Future Goals

The initiative is now active with EWEC processing 10 applications. It targets including at least 50 industrial institutions over two years. This collaboration between MoIAT, MoEI and EWEC strengthens competitiveness by enabling substantial savings in operating costs.

Yousif Ahmed Al Ali, CEO of EWEC said: "EWEC is proud to support the development of the industrial sector." He added that adjusting energy tariffs reflects their commitment to providing innovative solutions that reduce operating costs.

This initiative aligns with objectives like Operation 300bn which supports entrepreneurship and new industrial projects. It positively impacts competitiveness within these emirates' industrial companies.

The programme also supports sustainability efforts by encouraging optimal energy use and reducing carbon emissions. This aligns with UAE's environmental goals under initiatives like National Energy and Water Demand Management Programme 2050.

With inputs from WAM