This paper contains a comparative economic study of a number of different expansion schedules for power and desalination plants required to meet a forecasted demand in electricity and water for the Emirate of Abu Dhabi. For power generation, steam turbine and gas turbine plants were considered and for desalination both multistage flash distillation and reverse osmosis processes were investigated. Nine combinations of power and desalination plants were selected and a present worth economic analysis was conducted. Capital and operating cost figures used are those typical of the local conditions at Abu Dhabi. Based on the assumptions used in this study the plant combination using steam turbine power plant connected to a reverse osmosis unit seems to represent the most economic alternative.