06/10/2026 05:39 AST
The UAE, along with Saudi Arabia, are expected to quickly increase data centre capacity, and will account for more than 80 per cent of the region's share of data centre capacity by 2030, as per an S&P report.
The credit rating agency said that both countries will presumably add around 2 to 3 gigawatt (GW) of IT power, making up up less than 2 per cent of global IT power but contributing the most in the region. Over the next four years, the US and Canada are expected to contribute the most, at 70 per cent of new data centre capacity.
New large-scale projects, such as the 5GW Stargate UAE campus, could push these numbers even higher. Stargate UAE is an AI infrastructure cluster based in the UAE-US AI Campus in Abu Dhabi, and is a collaboration between G42, OpenAI, Nvidia, Oracle, Cisco, and SoftBank. The initial 1 GW is expected to be completed over the next three years.
In Saudi, the data centre projects developed by the Public Investment Fund-backed company Humain could push data power of up to 1.9 GW by 2030, rising to 6.0 GW-6.6 GW in 2034.
However, deployment timelines differ. While Saudi Arabia's capacity additions will likely only materialise later in the decade, the UAE is accelerating the expansion of its data centre sector. As a result, the timing and magnitude of capex should follow the same trend, S&P said.
$11 million needed
The average cost to build data centres will average about $11 million per megawatt in the UAE and $13 million/MW in Saudi Arabia over the period 2026-2030, compared with $12 million/MW in Europe and $13 million in North America, according to 451 Research.
The credit rating agency said energy affordability and accessibility are crucial for the region's data centre prospects, with average energy prices well below global averages, providing a significant competitive advantage.
In addition to generating clean, non-hydrocarbon-based electricity, the UAE is investing heavily in nuclear energy to power these data centres, according to the S&P report.
Strict regulations driving demand
Demand for data centres and local partners should benefit from regulations. Strict data localisation regulations and sovereign cloud policies increase the demand for domestic data centres. And joint ventures combining US or Chinese hyperscalers with local partners that maintain operational control of the data centres will be important to address digital sovereignty goals.
The implementation of personal data protection laws in the UAE and Saudi Arabia, as well as frameworks such as the Cloud Computing Regulatory Framework and Essential Cybersecurity Controls, mandated local data storage in line with GCC countries' national long-term goals, investments focus on data literacy, AI security, and AI-enabled tools.
Khaleej Times
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