Dubai to freeze utility prices for next two years
No drop in tariffs despite lower oil price, says DEWA's Saeed Mohammed Al Tayer.
Dubai Electricity and Water Authority (DEWA) plans to freeze power and water prices for the next two years.
The recent fall in oil prices means cheaper feedstock for the utility’s power plants which currently run exclusively on natural gas imported via pipeline as well as liquefied natural gas (LNG) ships.
However Saeed Mohammed Al Tayer, managing director and CEO, says electricity tariffs will remain unchanged as DEWA has been investing heavily in technology to boost efficiency
“We have a clear roadmap and in the coming two years we are working to maintain Dewa’s tariff no matter what the oil price will be,” Al Tayer said at a press conference ahead of the opening of the WETEX exhibition in Dubai next week.
“Despite the fact that the drop in oil price helped reduce the LNG price, which usually is double the current price of oil at $80 or $90 per barrel, we recently increased energy efficiency by 400 Megawatts (MW) by applying better technology,” he said.
The price of purchasing LNG is linked to international oil prices with a lag of around six months and Dubai imports most of its LNG in the summer months to meet peak demand for air conditioning and district cooling.
Cheaper natural gas should also lead to a lower cost of producing water from the energy intensive desalination process.
DEWA’s current power generation capacity stands at 9,740MW.