Power Generation Regional News

Spurred by a buoyant economy and population growth, the GCC countries will invest $100 billion to generate 100,000 MW of additional power over the next 10 years to meet demand. Oil and gas-rich Qatar and Abu Dhabi have invited international companies to build and run large-scale power and desalination plants that will help them meet double-digit electricity and water demand growth driven by rapid industrialization and population growth. The countries of the Gulf Cooperation Council (GCC) look set to turn to nuclear power to meet their energy needs, as it was revealed that the demand for electricity in the region is growing at a rate of six per cent a year.  Due to this immense increase in the demand for energy it offers great opportunities for private equity investment.

• $4.5 - $6 billion investment is needed annually in Saudi Arabia over the next fifteen years to cope with demand.
• Saudi Arabia has one of the largest per capita electricity consumption rates in the Middle East. 
• With a population of approximately 25.8million, which is growing at a rate of 2.4 percent per year, demand for electricity is high. 
• Saudi Arabia needs to expand its power and network capacity to support the country's industrialization plan as power demand grows by 7% or more each year.
• Saudi Arabia's Industry and Electricity Ministry estimates that the country will require up to 20 gigawatts (GW) of additional power generating capacity by 2019 - nearly the same amount as today's 26.6 GW - at a cost of $4.5-$6 billion per year.  Saudi Arabia requires $624 billion investment required over the next 15 years to cope with the increasing demand largely due to the booming population, $46.9 billion of this investment is needed for power generation.
• SR7 billion ($1.9 billion) was invested for the setting up of the Shuqaiq Independent Water and Power Project

• Electricity demand in the United Arab Emirates (UAE) has been rapidly increasing in recent years. Between 1996 and 2001, electricity use in the UAE increased by nearly 9 percent per year.
• It is estimated that the UAE electricity sector will require about $8 billion in investment over the next 8 years to meet demand, and the government has plans to expand its 9,500 megawatts of installed capacity by more than 50 percent over the next decade.
• It is estimated that Dubai alone will have to invest Dh50 billion to boost its power generating capacity to 9,500 megawatt and expand its transmission by 2010.
• Total Electricity production increased from 45,119 million kilowatts per hour (Kw/h) in 2002 to 48,163 Kw/h in 2003.
• Dubai Electricity and Water Authority continues to invest heavily to raise power generation and desalination capacity to match demands as a result of the boom in residential and commercial development and recently unveiled the new Dh6.3 billion 1,300MW power and desalination project in Jebel Ali.
• Sharjah Electricity and Water Authority announced in early 2003 the approval of a US $440 million budget by the Emirate for an ongoing expansion plan. US $145 million of this will be spent on new projects.  
• South Korea's Doosan Heavy Industries and Construction Co. Ltd. said it has won a $1.14 billion order to build a thermal power plant for Dubai Electricity and Water Authority (DEWA).
• Siemens have also won a US $100 million (AED370 million) turnkey contract to build a 400kV/132kV substation for phase three of the H Station power plant in Al Awir, Dubai.

• $4 billion investment over ten years is needed in Kuwait to cope with demand.
• Kuwait has one of the highest rates of per capita consumption of electricity in the world, with the demand for power reaching peak levels recently. 
• The expectation is that this demand will continue to increase at the rate of 7-9 per cent in the next few years. 
• It has been reported that Kuwait will need to invest around $4 billion over the next ten years to finance an expansion programme for an additional 3400 MW to cope with demand. 
• The construction of two new power plants is planned under this programme, the 2400 MW Al-Zour North plant and the 1000 MW Al-Zour South II plant.

• Installed capacity is barely able to meet current consumption, with the country's population growth and economic development leading to rapid power demand increases and Bahrain’s power grid awaits a BD10 million upgrade.
• In addition to trying to increase supply, the Bahraini government has continued its attempts to improve the nation's transmission and distribution infrastructure and will invest an estimated $1billion to generate an additional 1200MW planned by 2010 as part of a strategy to meet the 5 per cent annual growth in power demand Bahrain

• Laws passed in Oman last year are set to drive the privatisation of the power sector, resulting in huge opportunities for private investors. The government has achieved further progress in privatising power sector with the signing of agreements for establishing a large power and desalination project in Sohar.
• The government has also taken a number of initiatives to restructure the sector this includes the opening up of the three fast-track projects — Al Kamil Power, AES Barka and Dhofar Power project.
• Demand for electricity in Oman is growing at a rapid pace, due to the growth of tourism in the country, therefore necessitating a large amount of construction, the population growth, and industrialization.
• Research indicates that consumption is now increasing at an average rate of 5% annually and the government is forecasting that demand for electricity will be 75% higher by 2015 than it is today.  Research also indicates that additional generation capacity of 60MW will need to be added between 2005 and 2009, meaning an addition of 30MW generating capacity every three to five years.  This will also open additional opportunities for the T&D sector.
• Work on the multibillion-dollar GCC power grid project, which will link the six GCC states with an integrated electricity network by the year 2010, will start in September this year.  The project, whose aim is to reduce the cost of power generation in the six GCC states of Saudi Arabia, Qatar, Bahrain, Kuwait, Oman and the United Arab Emirates, will be carried out in three phases.  13 contracts will be awarded in the first phase, worth $1.25 billion to link Saudi Arabia with Kuwait, Bahrain and Qatar.  The GCC states began discussing the project some 20 years ago to integrate their transmission systems and make better use of their power-generating capacity.

Work on the multibillion-dollar GCC power grid project, which will link the six GCC states with an integrated electricity network by the year 2010, will start in September this year.  The GCC countries will invest $100 billion to generate 100,000 MW of additional power over the next 10 years to meet demand. The project, whose aim is to reduce the cost of power generation in the six GCC states of Saudi Arabia, Qatar, Bahrain, Kuwait, Oman and the United Arab Emirates, will be carried out in three phases.  13 contracts will be awarded in the first phase, worth $1.25 billion to link Saudi Arabia with Kuwait, Bahrain and Qatar.  The GCC states began discussing the project some 20 years ago to integrate their transmission systems and make better use of their power-generating capacity.

The final batch of contracts being tendered as part of the GCC grid interconnection project has attracted some 14 bidders and technical bid evaluation is now underway by the GCC Interconnection Authority (GCCIA).