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UAE's 2018 electricity fee cuts to benefit 6,000 factories

Large factories have been prioritised for their contribution to national industries, the UAE's Minister of Energy and Industry said

The UAE's recent electricity tariff cuts are expected to benefit more than 6,000 factories in the country [representational image: Thyssenkrupp].
The UAE's recent electricity tariff cuts are expected to benefit more than 6,000 factories in the country [representational image: Thyssenkrupp].

More than 6,000 factories are expected to benefit from the UAE Cabinet’s recently announced electricity tariff cuts for the industrial sector, according to data shared by the country’s Ministry of Energy.

Suhail bin Mohammed Faraj Faris Al Mazrouei, the UAE’s Minister of Energy and Industry, commended the initiative adopted by Vice President and Prime Minister of the UAE, and Ruler of Dubai, HH Sheikh Mohammed bin Rashid Al Maktoum.

The cabinet’s adoption of the initiative is aimed at supporting the local industrial sector and boosting the UAE’s position as an investment destination. The tariff is expected to take effect in Q4 2018, and reduce dependence on environment-unfriendly power sources, such as liquid fuels.

Large factories will see their electricity consumption charges cut by 29%, while small and medium factories will see reductions of 10-22%. Service connection fees will be waived for new factories.

READ: How the UAE's new expat retiree visa will impact construction

Commenting on the tariff, Al Mazrouei added: “Large factories are major contributors to the national economy and help meet Emiratisation targets by generating job opportunities for UAE nationals.

“The initiative is not confined to a certain sector, but […] addresses the entire industry platform; however, the focus has been laid on large factories on account of their major contributions to the national industries,” he explained, according to WAM.

Mohamed Mohamed Saleh, director general of the UAE’s Federal Electricity and Water Authority (Fewa), said the industry sector accounts for more than 25% of Fewa’s income.

Industrial businesses in Ras Al Khaimah and Fujairah could be among the initiative’s largest beneficiaries, he added.

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Sep 15, 2019