{
  "id": 16703386,
  "title": "UAE's AI power advantage faces its biggest test yet",
  "url": "https://urgent.news/2026/10/27/uaes-ai-power-advantage-faces-its-biggest-test-yet-16703386",
  "topic": "ai",
  "section": "AI",
  "published": "2026-10-27T03:00:00.000Z",
  "source": {
    "name": "The National Business",
    "slug": "the-national-business",
    "url": "https://www.thenationalnews.com/future/2026/10/27/uaes-ai-power-advantage-faces-its-biggest-test-yet/"
  },
  "original_language": "en",
  "account": "The UAE's AI power advantage currently faces its most significant challenge yet. While the country possesses abundant energy resources and a rapid construction capability, the growing demand for electricity from AI data centres is straining the grid in the US, their largest market. The UAE has a natural advantage in providing cheap and clean power for AI, but it remains to be seen if they can sustain this advantage.\n\nThe UAE's AI Campus, a master plan covering 26 square kilometres near Abu Dhabi, is designed to host up to 5GW of data centres. The first phase, called Stargate UAE, is a 1GW cluster that has already begun construction, with the first 200MW expected to be operational this year. However, further expansion remains on paper.\n\nThe UAE's annual electricity consumption was 173TWh in 2025, with data centres accounting for 3TWh, or 2% of total demand. If the full 5GW Stargate campus were built and operated at full capacity, it would consume an additional 44TWh per year, which is roughly a quarter of the UAE's current national demand. Adding the planned Barakah nuclear plant and existing gas-fired capacity would further bolster the country's power generation capabilities.\n\nHowever, simply having the power available is not enough. The UAE must also be able to deliver it reliably and securely to the data centres. Currently, corporate and virtual power purchase agreements are not permitted, and renewables are procured through utility auctions. This limits the ability of tech companies to purchase green power and could be a competitive disadvantage compared to other regions.\n\nMoreover, geopolitical tensions pose an additional threat to the UAE's AI power advantage. In March, Iranian strikes damaged two Amazon Web Services data centres in the UAE, and the country has been named as a potential target in Iranian military propaganda. In response, the UAE is reworking its AI campus plan into a more dispersed network of smaller sites, with underground facilities, air defenses and duplicated power and cooling. This increased complexity could raise the cost of delivering power to the data centres and reduce overall performance.\n\nTo maintain its lead in AI power, the UAE must focus on several key areas. Firstly, they need to ensure that their power supply keeps pace with demand, by expanding generation capacity at a similar rate to the growth of data centres. Secondly, they should open up the market to allow corporate entities to purchase clean power through power purchase agreements, which would help meet their own climate targets and make the UAE a more attractive location for AI development. Thirdly, they should prioritize building resilient and secure sites that can withstand potential attacks, as the recent Iranian strikes have demonstrated.\n\nIn conclusion, the UAE's AI power advantage is real and currently attracts the world's leading AI companies. However, it is not yet a guaranteed long-term advantage. The UAE must prove that it can deliver power securely and cost-effectively to dispersed sites, even in the face of geopolitical tensions. If they can succeed in these areas, the UAE's natural advantage in energy and speed of construction could position them as a global leader in AI infrastructure for years to come.",
  "summary": "For most of the AI boom , the bottleneck was chips . Increasingly, it is electricity . In the US, the world’s largest data centre market , the grid interconnection queue holds about 2,300GW of projects, and new AI campuses can wait years for the electricity they need. TrendForce estimates that by 2030, global data centre demand could exceed available grid capacity by more than 250GW. That shift…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}