Private players set to operate utility plants

The UAE has approved a draft law that allows private companies to build and operate power and desalination plants to help meet the country's growing needs for utilities.

Such is the need for power and water
Such is the need for power and water

The UAE has approved a draft law that allows private companies to build and operate power and desalination plants to help meet the country's growing needs for utilities.

Under the new law, private sector companies will be able to set up regeneration and water production stations in areas supervised by the Federal Electricity and Water Authority (Fewa), according to laws and regulations issued by the Cabinet, and provided they comply with environmental standards and laws.

The draft law, which was discussed by the Federal National Council (FNC) last Tuesday, will introduce a new article to Federal Law No. 31 for 1999 regarding the setting up of the authority.

The FNC intends to amend article 23 by adding a condition that water and electricity tariffs must be under the authority's control. Earlier discussions between the Public Facilities Committee at the FNC and Fewa officials reached the conclusion that demand over water and electricity increased beyond Fewa's expectations.

The authority's development plans were based on 7% growth, but the actual growth rate is 19%.

Fewa is mandated to supply water and electricity to the Northern Emirates, while Abu Dhabi Electricity and Water Authority (Adwea), Dubai Electricity and Water Authority (Dewa) and Sharjah Electricity and Water Authority (Sewa) control utilities companies in Abu Dhabi, Dubai and Sharjah respectively.

While Abu Dhabi has partly privatised its utilities, Dewa and Sewa are yet to start the privatisation process.

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