The members of the Cooperation Council for the Arab States of the Gulf (GCC) have successfully addressed all water resource problems throughout the region from the supply side. That is, GCC nations have dealt with water scarcity by increasing the supply of water and continuing to provide subsidized water. However, there are few efforts to address and improve urban water supplies through metering, pricing and other efficiency measures to reduce water demand. Instead, the needed potable water comes from the construction of desalination plants that are energy intensive and contribute to air pollution. This paper examines how water subsidies might affect water consumption in Abu Dhabi, United Arab Emirates, and how changes in consumption can in turn affect production levels, which determine total emissions of NOx, SOx, particulate matter, and CO2 into the atmosphere from desalination plants.