Impact of revised energy tariffs on industry: EtihadWE’s Yousif Ahmed Al Ali shares insights

The UAE Ministry of Industry and Advanced Technology, Ministry of Energy and Infrastructure, and Etihad Water and Electricity (EtihadWE) recently announced a revised energy tariff structure that offers financial incentives and reductions in rates for large industrial and technology sector customers in the Northern Emirates.

In an exclusive interview with Gulf Business, the CEO of EtihadWE, Yousif Ahmed Al Ali, talks openly about the announcement and its positive outcomes for the UAE’s industrial and technology sectors.

The Ministry of Industry and Advanced Technology announced, in partnership with the Ministry of Energy and Infrastructure and EtihadWE at the ‘Make It In The Emirates’ forum, a series of new energy tariffs set to lower fees for large industrial and technology sector customers. What details can you share about these new tariffs?

Under the new tariff scheme, we are introducing a pricing model that significantly reduces the cost of electricity for large industrial and technology sector customers based on their consumption levels.

These reductions lower operating costs for existing industries and are aimed at attracting new investments into the region. By doing so, this initiative aims to enhance the competitiveness of the Northern Emirates, encouraging the growth of high-value industrial activities and driving innovation within key sectors.

This initiative also aligns with our broader goals of economic development for the region, and is part of a broader strategy to support industrial growth, strengthening the UAE’s position as a leading destination for manufacturing and industrial innovation.

Under the revised tariff, new pricing bands have been introduced for industrial and technology customers with monthly consumption above 10,000 MWh, with tariffs starting from 32 fils/kWh and down to as little as 26 fils/kWh.

It also comes with attractive additional incentives, such as more favourable connection fees that can take the form of either a flexible monthly network usage fee or a reduced upfront payment of 20 per cent of standard connection fees.

It also includes a security deposit waiver for all customers of the scheme, no surcharge over the rates, and no additional meter rental charges.

How will industry and the UAE economy benefit from these new tariffs?

The new tariff structure will have a significant impact on both the industrial sector and the broader UAE economy beyond the Northern Emirates. Reduced electricity costs for large industrial players are ultimately a strategic lever to boost economic activity and foster industrial growth.

The reduced tariffs make the Northern Emirates an even more attractive destination for investment, as lower energy costs directly translate into reduced operational expenses for businesses — making it economically viable for both existing businesses to expand and for new players to enter the market.
Industries such as manufacturing and processing will be able to scale up their production without a proportionate increase in costs, leading to higher productivity and contributing to the GDP growth of the country.

Ultimately, with the expansion of industrial activities encouraged by lower tariffs, there will naturally be a need for more workforce, resulting in further job creation.

These new tariffs represent a strategic investment in the future of the UAE’s industrial landscape. They are expected to catalyse a cycle of economic growth, and innovation, that will benefit the entire nation.

What role do you see the energy sector playing in supporting and stimulating long-term industrial innovation in the UAE?

The energy sector has always played an important role in supporting and stimulating long-term industrial innovation in the UAE, serving as both a backbone and a catalyst for sustainable economic growth and industrial advancement. As we venture further into an era defined by rapid technological changes and heightened environmental awareness, the intersection of energy provision and industrial innovation becomes increasingly critical.

By offering reliable and cost-effective power, we create a competitive industrial environment. Affordable and stable energy is fundamental for high-tech industries, data centres, and manufacturing units that require continuous power to operate efficiently and innovate. The introduction of our reduced tariff structure, for example, directly reduces operational costs, enabling businesses to invest more in research and development rather than on overheads.

How does this announcement align with EtihadWE’s wider ambitions and goals for the energy sector?

This announcement of reduced energy tariffs aligns perfectly with EtihadWE’s broader ambitions and strategic objectives within the energy sector.

By introducing more competitive energy tariffs, we are responding proactively to the increasing demand for energy, particularly from the industrial sector, and ensuring that the Northern Emirates are well-prepared to support both existing businesses and future growth.

Yet our initiative goes beyond economic incentives, by understanding and directly responding to the needs of our customers. By offering lower tariffs, we provide industrial entities the opportunity to reduce operational costs significantly. This, in turn, enables these businesses to invest more in areas like research and development and technological enhancements, fostering an environment ripe for innovation and advanced industrial activities.
One of the other key aspects of this initiative is to attract cutting-edge industries, such as data centers, which require significant and reliable energy supplies. The new tariff structure is designed to make the Northern Emirates an attractive location for these high-tech industries, further diversifying our economic base and aligning with global trends in digital transformation.

Aligned with our long-term goals, this tariff revision is also about preparing our infrastructure to meet the anticipated demands of these growing industries. By ensuring our infrastructure can support the energy needs of a diversifying industrial sector, we are setting the stage for sustained economic and technological activity in the region.

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