TAQA Group focused on delivering its growth strategy

Abu Dhabi National Energy Company (TAQA) has reported its earnings for the period ending 31 December 2023. TAQA delivered a solid financial performance driven by strong and stable returns from its long-term contracted utilities business whilst it has remained focused on delivering its growth strategy.

In a statement, TAQA said its group revenues were AED 51.7 billion, an increase of 3% versus the prior-year period as higher pass-through bulk supply tariffs and improved allowances under the Regulatory Control 2 (RC2) regime within the Transmission and Distribution segment offset a decline in Oil & Gas revenue.

TAQA also reported full year 2023 net income of AED 16.7 billion, an increase of AED 8.6 billion, mainly driven by a one-off gain of AED 10.8 billion recognised on the acquisition of a 5% shareholding in ADNOC Gas, in part offset by a one-off AED 1.1 billion deferred tax liability associated with the introduction of UAE corporate income tax from 1 January 2024.

H.E. Mohamed Hassan Alsuwaidi, TAQA’s Chairman, commented: “TAQA’s strategic positioning across its markets, particularly in Abu Dhabi as a fully integrated local utilities champion, remains key to our robust results. Our achievements in 2023 serve as a foundation for further growth, which will include organic and inorganic expansion as well as substantial investment into power and water capacity and UAE-based transmission and distribution networks over the coming years. The significant upward revision of our production targets is testament to our confidence in being able to deliver on our ambitions and strategic goals for 2030 and beyond.”

TAQA announced significantly higher targets for 2030 to reflect 1) stronger growth ambitions and 2) integration of Masdar in its portfolio. The gross power capacity target has been tripled to reach 150 GW by 2030, of which 100 GW is renewable capacity through Masdar, while targets have also been introduced for net power capacity of 50 GW by 2030 and water generation capacity of 1,300 MIGD by 2030. Renewable energy is expected to constitute over 65% of the generation mix by 2030 versus 45% as at the end of 2023. 

TAQA noted that it envisions a total spend of AED 75 billion by 2030 to achieve its ambitious expansion programme. This is comprised of an AED 40 billion expenditure on UAE-based transmission and distribution networks, in line with the expenditure announced in the company’s 2021 corporate strategy. The remaining AED 35 billion is allocated for the Generation business, with 55% of this total expected to be invested in Masdar. 

Jasim Husain Thabet, TAQA’s Group Chief Executive Officer and Managing Director, commented: "Focused on delivering our growth agenda, our capital expenditure increased significantly during the year, paving the way for the Company’s AED 75 billion 2030 investment pipeline as we expand our power and water capacity and UAE-based transmission and distribution networks.  During the year, we announced a series of notable projects including Mirfa 2 Reverse Osmosis IWP with Engie, an investment into Xlinks First Limited, a strategic partnership with the government of Uzbekistan to explore strategic opportunities for investment in the country’s power sector, and an AED 8.1 billion (USD 2.2 billion) project with ADNOC for sustainable water supply to ADNOC’s onshore operations – which was followed by financial close."

TAQA continued building its portfolio in 2023 via organic and inorganic means. This included continued expansion of the company’s desalination capacity (Mirfa 2 development underway, with the project set to become UAE’s third largest RO plant upon completion) and entry into the attractive UAE operations and maintenance (O&M) segment within Generation. The company also received a 5% stake in ADNOC Gas in recognition of the value created by the long-standing, close working relationship between TAQA and ADNOC.