Rystad Energy forecasts that MENA’s electricity demand will rise from 1,671 terawatt-hours (TWh) in 2025 to 3,670 TWh by 2050. Installed power capacity is projected to increase even more sharply, quadrupling from 580 gigawatts (GW) to 2,328 GW over the same period.

The outlook highlights the scale of investment required in generation, transmission, distribution, storage and energy efficiency as governments and businesses prepare for rapidly rising electricity consumption.

Demand growth is expected to come from traditional residential and industrial users as well as emerging sectors. Data centres, hydrogen production, transport, commercial activity and public services are all expected to add to the region’s electricity requirements.

Carlos Torres Diaz, head of power at Rystad Energy, said the Middle East was entering a period of significant expansion in its power system, with renewable energy playing an increasingly important role.

He said nuclear power would remain a viable source of supply, while gas would continue to form part of the regional energy mix alongside renewables.

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Total installed power-generation capacity is projected to increase to about 50 gigawatts from the current 25 GW, Abdulaziz Alobaidli, director general for regulatory affairs at the Abu Dhabi Department of Energy, told The National. The Emirate plans to invest more than Dh300 billion (USD 81.7 billion) in generation, transmission and distribution infrastructure over the coming decades.

The scale of the planned investment highlights how electricity is becoming a strategic input in Abu Dhabi’s economic diversification programme. The emirate is seeking to expand non-oil industries while developing itself as a regional centre for technology, finance, manufacturing and logistics.

AI is expected to become an increasingly important source of demand. Abu Dhabi is positioning itself as a global artificial intelligence (AI) hub, with large-scale computing facilities requiring vast quantities of reliable electricity.

One of the flagship projects is Stargate UAE, a 1 GW AI infrastructure project by Abu Dhabi-based G42, in collaboration with OpenAI, Oracle, and Nvidia, which forms part of a planned 5 GW UAE-US AI campus in Abu Dhabi.

The growth in electricity consumption will also coincide with a transformation in how Abu Dhabi generates power.

The Emirate expects clean and renewable sources to account for 60% of its power mix within five years, compared with about 45% currently, with the share expected to increase further thereafter.

The shift is central to the UAE’s longer-term net-zero strategy. Abu Dhabi’s Department of Energy has modelled several pathways towards 2050, including scenarios involving greater electrification, renewable energy, nuclear power, hydrogen and carbon capture. Its energy outlook says electricity demand could reach as high as 251 terawatt-hours in 2050 under a current-policies scenario, compared with 205 TWh in the 2021 base year.

The Emirate is also investing in round-the-clock clean power. Masdar, in partnership with Emirates Water and Electricity Company, is developing a USD 6 billion project designed to provide 1GW of uninterrupted renewable electricity. The project is expected to begin operating next year.

The expansion comes as global electricity demand is accelerating. The International Energy Agency expects electricity consumption to rise substantially as economies electrify transport, industry and buildings, while data centres and AI add a new source of demand.

For Abu Dhabi, the challenge is therefore not simply generating more electricity. It is ensuring that power remains reliable while the system becomes cleaner and more complex.

The Emirate’s experience during the recent regional conflict has reinforced that priority. Alobaidli said Abu Dhabi’s power and water infrastructure remained operational and undamaged, which he attributed to long-term investment and preparedness.

That resilience will become increasingly important as the emirate builds an economy in which energy-intensive industries and AI infrastructure operate alongside conventional oil and gas businesses.

Abu Dhabi’s next economic expansion will therefore require a parallel expansion in electricity.

The message from its planners is clear: the race for economic growth is increasingly a race for reliable power.

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