‘Free solar’ in Dubai: exactly how a PPA works, who owns what, and the catch to check

“Free solar” sounds like a marketing line. In Dubai it describes something specific: a solar power purchase agreement, or PPA. You pay AED 0 upfront. A provider designs and installs a solar system on your roof at its own cost, then owns it, insures it and maintains it for the life of the contract, and you buy the electricity it produces at a rate below what DEWA charges you. Your bill falls from the first month without capital leaving your account. It is a genuine offer with genuine small print, and this guide covers both: exactly how a PPA works, who owns what, and the catch to check before you sign.

How a solar PPA works, step by step

1. Survey and proposal. The provider assesses your roof and your consumption, then offers a per-kWh price for solar power, set below the DEWA units it will replace.
2. You sign a long-term agreement. PPA terms typically run from 10 to 25 years. The length is what lets the provider recover its investment from selling you power rather than selling you hardware.
3. The provider funds and builds the system. Design approval, installation and grid connection all run under DEWA's Shams Dubai programme through an enrolled contractor. You pay nothing for the equipment or the work.
4. You buy the solar output. Each month you pay the provider for the kWh the system generated, at the agreed rate. DEWA continues to supply whatever the panels do not cover, billed as normal.
5. At the end of the term. Depending on the contract, you can typically extend the agreement, buy the system at a pre-agreed or fair-market value, or have it removed. These options are negotiated upfront; see the clauses below.

Who owns and pays for what

That allocation is the real meaning of “free”: you are not being given the system, you are being spared the cost and the risk of owning it.

What the saving looks like

A PPA rate is typically set around 25% below the blended DEWA rate the solar displaces. Because DEWA bills through rising slabs (explained in our guide to the Green-to-Red bands), the displaced units are your most expensive ones. For a four-bedroom detached villa using around 3,000 kWh a month, the DEWA bill is roughly AED 920; a PPA covering that consumption saves in the region of AED 230 a month from day one, with nothing invested.

Figures are estimates, not a quote. Final numbers depend on a site survey and DEWA approval.

Businesses use the same structure at larger scale. For a warehouse or an office, a PPA converts one operating cost into a smaller operating cost without touching the capital budget, which is why commercial PPAs suit companies that want the saving but not another asset on the balance sheet.

The catch to check: four clauses that decide the deal

None of the following makes a PPA bad. Any of them, badly drafted, can. Read for these four before signing anything.

1. Term length

Ten to twenty-five years is a long commitment. Ask what the agreement assumes about you staying in the property for the duration, and what early termination costs. A shorter term generally means a higher per-kWh rate; that trade should be stated openly, not discovered later.

2. Rate escalation clauses

Some PPAs fix the rate for the whole term. Some raise it by a set percentage each year. Some index it to DEWA's tariff. An escalator that outpaces DEWA can quietly erode the discount until you are saving very little in the final years. Ask for the year-by-year rate schedule in AED per kWh, in writing, and compare the last years against the first.

3. What happens if you sell the property

The system is on your roof but is not yours. A good contract lets you transfer the PPA to the buyer or buy out the system at a published schedule of values. A poor one leaves the question open, which becomes your buyer's lawyer's problem, and then yours. Confirm both routes exist and what each costs before you sign.

4. Roof access and end-of-term terms

The provider needs roof access for maintenance for the whole term, and the roof itself still has to be maintainable underneath the array. Check who pays for panel removal and reinstatement if the roof needs repair or waterproofing, and pin down the end-of-term options (extension, purchase price, or removal), including who pays for the removal.

PPA or buy? A one-paragraph answer

If capital is available and you plan to stay put, buying the system outright captures the whole saving rather than the discount share, and in Dubai the maths is short; our worked payback examples land around five years for a typical villa. If you would rather keep the capital, or want the maintenance and performance risk to be someone else's job, the PPA is the route. The free solar page sets out how our PPA route works in detail, and the savings calculator shows both options side by side from your own bill, for homes and businesses alike.