Hydrogen law, regulations & strategy in the Middle East

Explore reliable legal information about hydrogen energy in the Middle East


Whilst this area of the world is typically known for more traditional energy sources, over the last few years there have been a number of projects in the Middle East that demonstrate how the region is researching and developing hydrogen technology and the deployment of a hydrogen economy, among other renewable energy sources. Several projects have been undertaken in the UAE, Egypt and Saudi Arabia, the most notable of which are outlined below. 


The United Arab Emirates (“UAE”) is a pioneer in renewable energy (particularly solar) and is committed to developing a green energy economy.

Air Liquide, a world leader in gases, technologies and services, recently undertook a study in collaboration with Al Futtaim Toyota and Khalifa University of Science, Technology and Research (“Khalifa University”), to distribute Toyota's hydrogen-powered fuel cell electric vehicle (“FCEV”), Mirai, and consider strategies of how to develop the hydrogen industry in the UAE. The study demonstrated that there is substantial potential for hydrogen mobility to become a major economy for the UAE, in line with the UAE’s Vision 2021, as well as its clean energy goals. 

In 2017, Al Futtaim Motors in partnership with Air Liquide opened the first hydrogen station in the Middle East, at Al Badia, Dubai Festival City. Construction of a second station was set to begin in 2020 in Masdar City, between Abu Dhabi National Oil Company (“ADNOC”), Masdar Clean Energy, and Al Futtaim Motors, though it is not known when this is due to become operational.

In February 2019, the Dubai Electricity and Water Authority (“DEWA”) inaugurated the first solar-driven hydrogen electrolysis facility, the Mohammed bin Rashid Al Maktoum Solar Park, in the Middle East and North Africa (“MENA”) region in Dubai. According to reports, the hydrogen produced at the facility is intended to be stored and deployed for re-electrification, transportation and other uses. It is likely that the facility will be operational in 2022. 

Expo 2020 Dubai, which has been postponed to October 2021 due to Covid-19, intends to showcase hydrogen mobility by powering a number of FCEVs with the hydrogen generated at the facility. In addition, the Emirates National Oil Company (“ENOC”) is planning to unveil a “Service Station of the Future” for the Expo, which will use multiple sources of energy, including solar and hydrogen.

The Abu Dhabi Police has also announced plans to convert its vehicle fleet to FCEVs by 2050.

Saudi Arabia

Hydrogen projects are generally considered to be in line with Saudi Arabia’s clean energy targets and vision for 2030, however, there have only been two large-scale hydrogen projects to date.

In July 2020, Air Products & Chemicals (“Air Products”), whose principal business is selling gases and chemicals for industrial use, announced plans to build a green hydrogen plant in Saudi Arabia. The plant will be powered by 4 GW of wind and solar power, making it the world's largest such project. The USD 5 billion plant will be jointly owned by Air Products, Saudi Arabia's ACWA Power, and Neom, a new mega-city planned near Saudi Arabia’s borders with Egypt and Jordan. Due to be operational in 2025 and situated in the city of Neom, the completed facility will produce 650 tons of green hydrogen daily, enough to run around 20,000 hydrogen-fuelled buses.


Egypt has huge potential in terms of land and resources to produce hydrogen powered by solar energy for export. Egypt is considered a “sun belt” country with 2,000 to 3,200 kWh/m2 of direct solar radiation.  The sun shines between 9 and 11 hours a day with few cloudy days. There are also land areas with high and steady wind speeds suitable for producing wind energy, which can also be used to produce green hydrogen.

Egypt has adopted an ambitious energy diversification strategy. The strategy aims at ensuring the continuous security and stability of power supply, the diversification of energy resources and the optimum exploitation of the country’s resources.  The strategy has set a target to achieve 20% renewable energy of the total national generation capacities by 2022. This share will increase to 37% in 2030 and to 42% in 2035. 

Research and education 

Air Liquide, Khalifa University, and Toyota distributor Al-Futtaim Motors have, in 2020, released a joint study that outlines the contribution of hydrogen to the energy transition and demonstrates the favourable prospects for hydrogen mobility in the UAE. Since 2014, Khalifa University has been collaborating with Japan to explore the possibility of establishing a hydrogen supply chain in order to increase hydrogen utilisation in the sustainable economy. 

In March 2020, the DEWA Research and Development Centre (the “R&D Centre”), part of the Mohammed bin Rashid Al Maktoum Solar Park, was opened. The R&D Centre is focussed on four major operational areas: “electricity generation from solar and clean energy, integration of smart grids, energy efficiency, and water”. A solar-powered green hydrogen project is being built at the outdoor testing facility of the R&D Centre, which is expected to be launched at the Dubai Expo 2020 (postponed until 2021).

Saudi Arabia

In 2019, Saudi Aramco and Air Products signed a cooperation agreement to jointly build Saudi Arabia’s first hydrogen FCEV fuelling station. The agreement brought together Air Products’ technical knowledge and experience in working with hydrogen and Saudi Aramco’s industrial experience, facilities and research and development capabilities.  The fuelling station became operational in late 2019. As part of the agreement, a pilot fleet of FCEVs will be built, for which high-purity compressed hydrogen will be dispensed at the new fuelling station. 

Several research and development initiatives and activities are currently being carried out at the King Abdullah University of Science and Technology (“KAUST”) into hydrogen and fuel-cell technologies. The aim of these studies being to the realise the results within Saudi Arabia’s transport sector. 


Hydrogen technology is still at the early stages of development in the Middle East. However, there are clear signs that the some of the oil-rich countries in the Middle East could potentially endorse more industrial and commercial uses of hydrogen as part of their transition to a greener economy. The UAE, for instance, is well on the path to a more diverse, secure and sustainable electricity sector and therefore CO2-free hydrogen is of particular interest to UAE policy-makers, from a climate policy point of view. Earlier this year, the UAE Environment Minister was quoted as saying “hydrogen produced by renewables in the very best locations [in the UAE] could become cost competitive in the next five years”.  The UAE, like most other countries in the Middle East, has sufficiently attractive resources for solar installations required to produce enough hydrogen to cover local demand. However, the UAE has two additional advantages: the availability of investment capital and a cooperative business environment, which could help it engage with the production of hydrogen and its potential as an export.

In Saudi Arabia, there are few large-scale projects, other than the plant to be built in Neom, mentioned above, and a hydrogen distribution system in the industrial city of Yanbu, built by Air Liquide. If these projects succeed, it is likely to lead to a new era of hydrogen developments throughout the Middle East.

With its large natural gas portfolio, Egypt has the opportunity to start producing blue hydrogen by converting a portion of its natural gas resources into hydrogen, using carbon-capture technology. In addition, Egypt is bordered by 2,450 km of coast, as well has having 1,530 km of the Nile River, placing it in a prime location to produce green hydrogen at scale and for low costs using electrolysis. Although a shift to a hydrogen economy might be a risk for Egypt, as a major natural gas-exporting country, it is a strategic chance to benefit economically and serve future decarbonised energy demand. Given its ample renewable energy resources, as well as its proximity to key markets, such as the EU, Egypt has outstanding opportunities to tap into new energy export markets.

Given the early stage of development in these countries, there has been little private sector involvement in M&A activity or project financing, though both are expected in the coming years as the hydrogen sector grows.


Legal framework

The Middle East needs a clear strategy for hydrogen. At present, there is no specific regulatory framework for the licensing and implementation of hydrogen projects in the UAE, Saudi Arabia or Egypt. The limited regulation of hydrogen in this region is discussed below. 

Financing Hydrogen Projects 

Mobilising private finance in support of a low-carbon transition is a challenge and investment in hydrogen projects is no exception. 

The planned USD 5 billion clean hydrogen-based ammonia production facility in Neom, Saudi Arabia, could be a model for securing further project financing. 

Similarly, in Egypt, one of the main challenges facing hydrogen energy is the cost of production. Producing, storing and transporting hydrogen, as well as building the necessary infrastructure, is expensive and likely to involve substantial capital expenditure compared to other renewable energy resources. However, some banks have expressed a willingness to provide debt funding.

Representatives from the European Bank for Reconstruction and Development (“EBRD”) announced to the Minister of Electricity, during their visit in February 2020, that they were willing to invest in green hydrogen in Egypt. Also, in February 2020, a delegation from General Electric (“GE”) met with the Minister of Electricity offering to launch renewable energy projects in Egypt using hydrogen, in a bid to capitalise on demand for the latest innovative technological trend in renewables.

Managing the Energy Mix

In the UAE, Abu Dhabi is currently investing heavily in various sources of low-carbon energy. The key question is how the Emirate will be able to efficiently integrate multiple energy sources into its electricity grid in the future, including nuclear, waste-to-energy, solar and thermal generation. A longer-term vision for Abu Dhabi also needs to set out policies and frameworks that accommodate emerging technologies and business models, including battery storage, electric vehicles and hydrogen fuel.



In July 2019, the Emirates Authority for Standardization and Metrology (“ESMA”) announced that it had completed the draft technical regulations for hydrogen-powered vehicles. The UAE is the first country in the MENA region to establish legislation for the future of the environmentally friendly vehicles industry. 

Currently, there is no enabling regulatory framework for hydrogen projects in the UAE. Hydrogen projects could be subject to a number of laws and regulations including the following:

  • Federal Law No 14 of 2017 on Trading in Petroleum Products which regulates the trade of petroleum products;
  • Abu Dhabi Law No 7 of 1971 which established ADNOC;
  • Abu Dhabi Law No 4 of 1976 being a gas ownership law entitling ADNOC to exploit Abu Dhabi's gas resources through joint agreement and projects undertaken with third parties;
  • Abu Dhabi Law No 1 of 1988 which established the Supreme Petroleum Council; and
  • Dubai Law No 19 of 2009 which established the Dubai Supreme Council of Energy.

The UAE Energy Strategy 2050 targets an energy mix that combines renewable, nuclear and clean energy sources to meet the UAE’s economic requirements and environmental goals. According to this strategy document, by 2050, 44% of the country’s energy must come from clean energy sources which include low carbon hydrogen.

Saudi Arabia

Currently, there is no dedicated legislation for hydrogen projects in Saudi Arabia. The Basic Law of Saudi Arabia (Royal Decree No. A/90 dated 27/8/1412 H (1 March 1992)) vests all the Kingdom of Saudi Arabia’s oil and gas wealth in the Government. The Ministry of Energy, Industry and Mineral Resources (“MEIM”) regulates, develops and implements policies relating to oil and gas and represents the Kingdom’s oil production and pricing policies internationally. MEIM supervises the activities of Saudi Aramco, a 100% government-owned enterprise that has exclusive access to oil and gas exploration, drilling and production in Saudi Arabia. 


Currently there is no unifying law which applies specifically to hydrogen projects in Egypt. Instead, the existing laws for the gas, transport and water sectors apply to hydrogen, which is classified as a gas under the Gas Market Law No. 196 of 2017 (the “Gas Market Law”). 

The gas market is mainly regulated in Egypt by virtue of the Gas Market Law. “Gas’” is defined broadly under this law to be “a mixture of hydrocarbon and non-hydrocarbon components, which exists in a gaseous state under standard conditions, including gas associated with oil or shale gas or extracted from biomass (biogas), as well as any other unconventional types of gas, whether it is liquefied or pressed or in a gaseous state, after treatment and separating any commercial derivatives such as condensate, butane, commercial propane, ethane-propane mixture according to the national network standard specifications, and it is considered a product that can be sold and traded in the markets.”

The Law provides for the establishment of a public body to be the regulator; this is the Gas Market Regulatory Authority. The Authority is responsible for regulating, licensing and overseeing all gas-related activities. The Law divided gas-related activities into (1) services activities, and (2) market activities. “Service activities” includes the operation of gas grids and facilities through transmission, storage, distribution of gas as well as LNG and regasification activities; “market activities” covers gas shipping and supply.

Regulation and national strategies specific to hydrogen and hydrogen technology will need to be put in place over time in Egypt in order to regulate the production, storage and transportation of hydrogen. Regulatory reform will be a key area of focus if Egypt wants to deploy a hydrogen economy. Until this reform happens, any hydrogen project will be governed by the existing gas, energy, water and environmental regulations. 

The main laws and regulations that currently apply to Hydrogen include the following:

  • Gas Market Law No. 196 of 2017 and its executive regulations issued by virtue of the Ministerial Decree No. 239 for 2018;
  • Electricity Law No. 87 of 2015 and its executive regulations issued by the Ministerial Decree No. 230 of 2016; and
  • Renewable Energy Law No. 203/2014.

Laws and regulations in respect of potential environmental impacts and safety include:

  • Environment Protection Law No. 4 for 1994 and its executive regulations issued by virtue of the ministerial decree No. 338 for 1994;
  • Law No. 7 for 2010 regulating Nuclear and Radiological Activities and its Executive Regulations issued by the Ministerial Decree No. 1326 for 2011; and
  • Ministerial Decree No. 566 for 2002 for the Requirement and Measures of Carrying out Activities at the Egyptian Ports.

In accordance with the Paris Agreement 2015, Egypt submitted its Nationally Determined Contributions (“NDCs”) in 2017 to be activated in 2020. Whilst Egypt’s NDCs do not include quantified targets or set a specific goal for future emission reductions, they mention the possibility of creating a domestic emissions market to help drive a reduction in greenhouse gas emissions (“GHGs”).


What regulatory bodies regulate the development, construction and operation of hydrogen projects in your jurisdiction, and what is the extent of their powers? What licensing requirements apply to businesses seeking to develop, construct and operate hydrogen projects in your jurisdiction? 


In Abu Dhabi, the Supreme Petroleum Council creates and oversees the implementation of general and fiscal policy in relation to domestic oil and gas resources. The council also functions as ADNOC's board of directors.

In Dubai, the Dubai Supreme Council of Energy is responsible for policy development with a view to developing new energy sources.

In Sharjah, the Petroleum Council of Sharjah is responsible for regulating the oil and gas industry and granting concessions.

The main entities responsible for the generation, transmission and distribution of electricity in the UAE are:

  • Emirates Water and Electricity Company (“EWEC”) - the sole procurer of water and electricity in the Emirate of Abu Dhabi.
  • The transmission and despatch of water and electricity is carried out by the Abu Dhabi Transmission and Despatch Company (“TRANSCO”). TRANSCO operates a load despatch centre in Abu Dhabi and is responsible for ensuring that producers have sufficient "real-time" generation and water capacity available to meet continuously varying customer demands.
  • The following companies are currently responsible for the distribution and supply of power and water in Abu Dhabi:
    • Abu Dhabi Distribution Company (“ADDC”)
    • Al Ain Distribution Company (“AADC”)
    • DEWA is the sole purchaser of electricity in Dubai and currently owns all the generation, transmission and distribution capacity of the Emirate of Dubai.
    • The Federal Electricity and Water Authority (“FEWA”) is responsible for generation, transmission, and distribution of electricity in the northern Emirates of the UAE. 

ADNOC is the UAE’s state-owned oil and petrochemicals company. ENOC is the national oil company of the Emirate of Dubai. Both ENOC and ADNOC are involved in various hydrogen energy programmes. 

The Roads and Transport Authority (“RTA”) is the authority responsible for public roads and transport in the Emirate of Dubai. In 2017, the RTA launched a trial run of the region’s first hydrogen FCEVs using Toyota’s Mirai in the Dubai Taxi Fleet. It plans to increase hydrogen-powered taxis in Dubai to 4,750 cabs by 2021.

Saudi Arabia

The major power-sector bodies relevant to hydrogen projects in Saudi Arabia are:

Regulatory BodyRole

The Ministry of Energy, Industry, and Mineral Resources (“MEIM”)

  • the government agency that handles policy and planning in the power sector.

The Saudi Electricity Company (“SEC”)

  • a government-owned Public Investment Fund (“PIF”) (holding over 80% of shares) that currently provides most of Saudi Arabia’s electricity, with a generation capacity of 78GW in 2018. It also carries out all transmission and distribution activities.


  • the government-owned company that manages Saudi Arabia’s oil and gas production. It is involved in power generation alongside SEC, as the primary supplier of feed stock.

The Electricity and Co-Generation Regulatory Authority (“ECRA”)

  • the Kingdom’s independent regulatory body for Saudi Arabia’s energy sector

The Power and Water Utility Company (“MARAFIQ”)

  • a government-owned entity that currently provides most of the power to the two industrial cities of Jubail and Yanbu, found in the Eastern and Al-Madinah Provinces, respectively.

The National Council on Climate Change is required to, among other things: 

  • organise and implement national research efforts and projects to reduce emissions and adapt to climate change risks; 
  • vet projects submitted to the Green Climate Fund (“GCF”); 
  • remove obstacles that stand in the way of collecting, managing and processing climate change data; 
  • draw the national and sectorial policies in relation to climate change in light of the international conventions and the national interests; 
  • follow up the UNFCCC negotiations and the related protocols and agreements; 
  • support and increase research and development in climate change initiatives; and 
  • raise public awareness about climate change.


The second half of the 2020s is likely to see the emergence of a regional hydrogen economy in the Middle East, driven by heavyweight frontrunners such as the UAE, Saudi Arabia and Egypt. If initial investments in renewable energies continue to be made in the region, to a level sufficient enough to generate economies of scale, coupled with an appropriate transport infrastructure, the first player to make a move will generate a lock-in in terms of customer retention. 

Amir Kordvani
Portrait ofFatma Salah
Fatma Salah
Partner, Riad&Riad