Abu Dhabi: Abu Dhabi National Energy Company PJSC (TAQA) one of the largest listed integrated utility companies in the region, announced Wednesday to substantially increase its gross power and water desalination capacity in the UAE and internationally.
The new strategic plan places at its core the global acceleration of the energy transition, and TAQA’s ambition to become a champion for low carbon power and water.
TAQA’s new strategy builds upon its identity post the TAQA and Abu Dhabi Power Corporation (ADPower) transaction, in July 2020, to focus on being a regionally leading fully integrated utility. As part of the plan, TAQA will drive efficiency from its existing assets while strengthening its development, operations and digital competencies.
Increased power and water capacity
Growth is expected through meeting increased power, water and network capacity needed in its home market of the UAE, as well as from selective opportunities internationally. TAQA’s business will be anchored in ESG principles and practices. As part of that commitment the company is working to develop and publish greenhouse gas emission reduction targets.
In addition, the company will remain focused on its financial strengths including protecting its stand-alone investment grade credit ratings and delivering on its recently announced dividend policy. This strong financial stewardship will complement the company’s ambitious and more focused growth strategy. Following the recent decision to allow foreign investors to own up to 49 per cent of TAQA’s issued shares, the company still expects to release a follow-on public offering, subject to market conditions and shareholder approval.
“TAQA has the support of our shareholders for this new strategy and is on its way to become the recognized low carbon power and water champion from Abu Dhabi, and this strategy sets out how the company will achieve this ambition. As we emerge from the pandemic, around the world there will be an increasing focus on the need for clean, reliable and sustainable sources of power and water. ,” said Mohamed Hassan Al Suwaidi, Chairman of TAQA .
Regioanl and international plans
Over and above the current strategic plan, TAQA will continue to capitalize on its unique position as UAE’s utilities champion and leverage the UAE’s strong relationships to drive power solutions across the region and globally, as well as consolidate its position within the UAE to deliver on national objectives.
Since the TAQA-ADPower transaction in July 2020, the company received upgrades to its issuer ratings to Aa3 from A3 and a standalone rating of baa1 (from Moody’s) and AA- from A and standalone rating to bbb+ (from Fitch).
In December of last year, TAQA’s shareholders approved a new dividend policy for 2020-2022, which will see TAQA introduce quarterly dividend payments to its shareholders and an annual increase of 10 per cent to returns in 2021 and 2022. It also approved up to 49 per cent of foreign ownership of TAQA to diversify the company’s investor base, improve stock liquidity and support the Government’s objectives to encourage foreign investment into the UAE.
“TAQA will become a champion for low carbon power and water. This strategy sets out how we are going to deliver on this promise and our vision for the future. We will build on our strengths and use the unique position we have in Abu Dhabi as a platform for growth in the UAE and internationally. We will expand our portfolio of renewables and highly efficient water desalination, drive efficiency in our networks and distribution business and invest in growing the UAE Regulated Asset Base,” said Jasim Husain Thabet, TAQA’s Group Chief Executive Officer and Managing Director.
• Expand highly efficient reverse osmosis technologies to make up two-thirds of its desalination capacity by 2030 with 200 MIGD already under construction.
• Focus on renewable energy – particularly solar photovoltaic (PV) – to comprise more than 30% of the power generation portfolio by 2030, up from the current 5 per cent.
Transmission & Distribution:
• Execute substantial UAE-based infrastructure and networks growth projects and invest an additional AED 40 billion by 2030 to grow its UAE Regulated Asset Base
• Continued focus on operational excellence, optimization and digitization across the entire value chain to become a role-model for high-performing and efficient transmission and distribution alongside improving the service for its customers
• Further strengthen the position of its operating company, Abu Dhabi Energy Services (ADES), and grow new services in demand-side management, enabling public and private entities to realize energy savings targets
Oil & Gas:
• Focus on commercially viable opportunities to reduce exposure to the hydrocarbon sector.
• Continue to pursue top quartile operations performance.
• Highly selective capital allocation focusing on portfolio rationalization for value.