UAE to launch pricing mechanism to boost private investment in EV infrastructure

The UAE will launch a “pricing mechanism” to incentivise the private sector to invest in the infrastructure for electric vehicle charging stations, the Minister of Energy and Infrastructure has said.

The Emirates, the Arab world’s second-largest economy and host of the Cop28 climate change summit, plans to increase the share of electric and hybrid vehicles on the roads to 50 per cent by 2050, Suhail Al Mazrouei said at the World Green Economy Summit in Dubai on Tuesday.

Currently, the country’s share of electric and hybrid vehicles is about 1 per cent.

“To achieve this goal, we constantly expand our network of EV charging stations,” Mr Al Mazrouei said.

“We are probably going to be the first country to put a pricing mechanism that will be announced later this year or early next year to incentivise the private sector to invest in EV charging station infrastructure.”

Global electric car sales are projected to reach 14 million in 2023, from 10 million last year, the International Energy Agency said in its Global Electric Vehicle Outlook report in April.

Electric vehicles will make up about half of the new car sales worldwide by 2035 as the push for net-zero carbon emissions accelerates, according to Goldman Sachs Research.

The UAE has been investing heavily in renewable energy projects and EV infrastructure to become carbon neutral by 2050.

This month, Adnoc Distribution, the country’s largest fuel and convenience retailer, said it would accelerate the introduction of EV charging points across its locations in 2024.

The Adnoc subsidiary, which expects to operate 50 EV charging points by the end of this year, will focus on installing the charging points on motorways where demand is higher, Adnoc Distribution chief executive Bader Al Lamki told media.

In July, the Emirates approved an updated version of the UAE Energy Strategy 2050.

The UAE aims to allocate as much as Dh200 billion ($54 billion) by the end of this decade to meet growing energy demand, while supporting economic growth.