Market Design for Successful Implementation of UAE 2050 Energy Strategy

Date Published: December 2019

Author: Shaima Al Naqbia, I. Tsung Tsai, Toufic Mezher

This paper reviews and proposes suggestions for a efficient market design to support the United Arab Emirates’ renewable energy targets, which include reducing carbon dioxide emissions by 70%, increasing clean energy use by 50% (renewables to 44% and nuclear at 6%), and improving energy efficiency by 40% by the middle of the century.

First the paper has a literature review on market design factors and subfactors to accommodate high renewable generation and selects a framework for market design analysis which addresses the critical factors in influencing the development of local renewable energy. The paper analyses the current market design in the United Arab Emirates and proposes improved policies and mechanisms in order to achieve the proposed targets. Finally, the paper looks at all relevant stakeholders, especially the main utilities, Abu Dhabi Water and Energy Agency and Dubai Water and Energy Agency, and proposes adjustments to the business models of those companies to facilitate the transition to a cleaner resource mix.

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