The United Arab Emirates on Wednesday announced it will launch energy projects worth $1 billion in Yemen to support the rebuilding of its energy sectors, which will be implemented by Abu Dhabi firm Global South Utilities (GSU).

The agreement will see the company implement a portfolio including projects in solar and wind energy alongside the development of distribution networks in the country, GSU said in a statement. Yemen is grappling with almost 30 years of an electricity crisis caused by fuel shortages and severe damage to the national power infrastructure from conflict, including a civil war that has torn the country apart since 2014.

It is, however, seeing some relief, as the country's first large-scale solar plant is helping alleviate some of the shortages. That plant in the southern city of Aden was also funded by the UAE.

While solar power represented only 10.4% of Yemen’s total electricity generation in 2023, according to the International Energy Agency, this is expected to rise with a second phase of the Aden Solar Power Plant planned for 2026 to double its capacity.

"This one-billion-dollar portfolio expands an energy system capable of supporting a larger economy and a more active market in Yemen,” said GSU CEO Ali Alshimmari.

Yemeni Prime Minister Salem bin Braik earlier on Wednesday said the UAE has pledged $1 billion to back the country's energy sector.

(Reporting by Utkarsh Shetti and Federico Maccioni in Dubai and Mohammed Ghobari in Aden; Editing by Chizu Nomiyama )