Sumitomo Corporation announces that we have signed a new power purchase agreement (PPA) with Emirates Water and Electricity Company (EWEC), a leading company in the integrated planning, purchasing, supply, and system despatch services of water and electricity across the UAE, extending the existing contract for an additional 15 years for a natural gas-fired power generation project at Shuweihat S1 power plant (hereinafter, the “Project”) with plant reconfiguration work, with the partners Abu Dhabi National Energy Company PJSC (“TAQA”), a diversified utilities and energy group, and ENGIE, a French energy and gas company.

The Project, which began operations in 2005, is a natural gas-fired power and water desalination project (with a power generation capacity of 1,500 MW and a desalination capacity of 100 MIGD) that was initially scheduled to conclude in June 2025. For nearly 20 years, it has contributed to the UAE by covering approximately 10% of the country’s electricity demand ( *1). The Project is planned to serve as an adjustable power source that complements the growing deployment of renewable energy in the UAE. Under the new PPA, the plant will be decommissioned for water desalination facilities, and converted to a natural gas fired open-cycle power plant (*2) only. Part of the plant will be modified to enhance its responsiveness and flexibility, operating only when demand arises, with a power generation capacity of 1,130 MW. After this modification, it is also expected to reduce annual CO2 emissions.

The UAE's Energy Strategy 2050 emphasizes maintaining economic growth while restraining expenditures. Additionally, as EWEC continues to drive the decarbonization of power and water supply in the UAE, powering the country’s net zero transition, EWEC has stated that gas-fired plants will be a key transition fuel to enable them to meet Abu Dhabi’s 2035 decarbonization targets as the company continues to successfully onboard new renewable capacity.

This Project is expected to ensure a stable power supply while minimizing equipment upgrade costs, positioning it as part of the UAE’s energy transition efforts aimed at achieving carbon neutrality by 2050. It will also become the first project in the country to undergo refurbishment and be extended for a long-term.

Through this Project, we will continue to contribute to the stable power supply in the UAE, where electricity demand is expected to increase alongside steady economic growth and industrial diversification.

*1 Based on 2022 data from "The World Factbook" published by the CIA.
*2 A power plant type which doesn’t have steam turbine lines but only has gas turbine lines, and which offers high flexibility for load change and ease of startup and shutdown.