Market Trends of UAE Switchgear Industry
Utility Segment to Dominate the Market
- The United Arab Emirates is one of the major countries regarding natural gas usage for electricity production in the Middle East. As a major oil and gas producer, the country finds using gas as its primary energy generation more economical and cost-efficient.
- Over the past few years, the country acquired significant strides in adopting renewable energy, specifically in the solar energy industry. The country initiated an ambitious mission to enhance energy security and address the growing energy demand by diversifying its energy sources and increasing renewable energy in its power portfolio in the upcoming years.
- Recently, there is a significant increase in the electricity demand in the United Arab Emirates (UAE), which is predicted to continue its upward trajectory soon. Numerous large-scale power projects focusing on conventional and renewable energy are underway to cater to the existing and forthcoming electricity demands. To achieve its goal of diversifying energy sources and conserving energy, the UAE is projected to continue its efforts in initiatives such as retrofitting buildings, constructing solar parks, and developing energy-efficient communities.
- With these power plant projects, the country is also expanding its transmission and distribution network to provide electricity in remote locations. These factors are driving the demand for switchgear in the region.
- For instance, in April 2022, the Dubai Electricity and Water Authority (DEWA) reported that the combined length of electricity transmission and distribution lines in Dubai reached 41,930 km, while the length of transmission and distribution lines reached 13,592 km.
- According to BP Statistics, the electricity generation in the country increased by almost 2% between 2020 and 2021. In 2021, United Arab Emirates generated around 139.4 TWh of electricity.
- Therefore as per the abovementioned points, the utility sector will likely dominate the switchgear market during the forecasted period.
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Adaption Of Renewable Energy To Drive The Market
- The United Arab Emirates is also a leader in developing renewable energy, particularly solar energy. The country set an ambitious target of generating 50% of its electricity from renewable sources by 2050. The UAE implemented various measures to achieve this goal, such as installing large-scale solar projects and promoting rooftop solar systems.
- The increasing installations of power generation by renewable resources are driving the power generation market of the United Arab Emirates. One of the other reasons for the promotion of renewable energy sources is the country's aim to reduce carbon emissions by 2030.
- With one of the highest solar exposure rates globally, the country includes vast potential for advancing renewable energy. As a result, solar power continues to be the leading contributor to renewable energy in the United Arab Emirates. The solar generation capacity is projected to increase from 4.76 TWh in 2019 to 13.66 TWh in 2028.
- According to IRENA, recently, the renewable energy installed capacity in the country is increasing quickly. In 2022, the installed renewable energy installed capacity was recorded at 3058 MW, an increase of almost 12% compared to 2020, where the installed capacity was at 2734 MW. The trend is expected to continue during the forecasted period.
- In January 2023, the Ministry of Energy and Infrastructure reported the UAE had initiated 11 eco-friendly energy projects, with a combined worth of AED 159 billion (USD 43 billion) in 2022. The country demonstrated its pioneering role in the clean energy sector.
- With this renewable energy adaption, the grid infrastructure is also developing in the country, which is expected to further drive the demand for switchgear in the region.
- Hence, the increasing investments in the renewable power sector are expected to drive the switchgear market of the country over the forecast period.
