Utilities
From The Report: Saudi Arabia 2018
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These are crucial times for Saudi Arabia’s power and water sectors as both move through a process of major reform. Privatisation is at a more advanced stage in water than in power, but the next few years should see substantial change in both markets, providing significant opportunities for investors. Projects that use a wider range of energy sources are also in the planning and development stages, while efficiency in distribution and usage is being strongly promoted, alongside a further reduction in subsidies through reorganisation of the electricity tariff system. Meanwhile, major desalination projects are under way, along with the roll out of new sewage and wastewater treatment plants, reservoirs, leakage reduction measures, transmission networks and groundwater conservation schemes. The Kingdom has set itself some ambitious short- and long-term goals for both sectors, with a shift towards a more market-oriented approach a key objective of the reforms.

This chapter contains an interview Ziyad Al Shiha, President and CEO, Saudi Electricity Company; Ali Alhazmi, Governor, Saline Water Conversion Corporation; and Thamer Al Sharhan, Managing Director, ACWA Power.

Articles from this Chapter

Overview

The path to privatisation: The Kingdom works to meet rising demand for energy and water
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These are crucial times for Saudi Arabia’s power and water sectors as both move through a process of major reform. Privatisation is at a more advanced stage in water than in power, but the next few years should see substantial change in both markets, providing significant opportunities for investors. Projects that use a wider range of energy sources are also in the planning and development stages, while efficiency in distribution and usage is being strongly promoted, alongside a further…

Analysis

Cold comfort: New air conditioning technology set to generate significant savings for the Kingdom
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One consequence of Saudi Arabia’s strong economic and population growth in recent years has been a major surge in construction, with new neighbourhoods, industrial estates, office complexes, hotels and hospitals all going up around the Kingdom. Given the country’s hot weather – summer temperatures regularly reach upwards of 40°C – the new developments have brought with them higher demand for air conditioning (a/c) and, subsequently, a surge in electricity usage. This places a considerable…

Interview

Power saver: Ziyad Al Shiha, President and CEO, Saudi Electricity Company (SEC), on tariff changes to promote lower consumption and generate efficiency
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Interview:Ziyad Al Shiha How will the gradual phase-out of electricity subsidies affect electricity consumption patterns? ZIYAD AL SHIHA: For a long time electricity tariffs in Saudi Arabia have been subsidised by the government. SEC is working with policymakers and the Electricity and Cogeneration Regulatory Authority (ECRA) on the gradual phase-out of these subsidies. We strongly believe that cost-reflective tariffs will contribute to greater awareness of the true value of electricity and…

Interview

Salient developments: Ali Alhazmi, Governor, Saline Water Conversion Corporation (SWCC), on the reform of the desalination industry
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Interview:Ali Alhazmi What challenges does the efficiency and reliability of Saudi’s desalination network face? ALI ALHAZMI: Although our latest plant at Ras Al Khair (RAK) operates at around 55% efficiency, the majority of our plants have less than 30% efficiency, and some are over 30 years old. As we move towards privatisation, we are working with international consultants to improve our operational excellence and efficiency in desalination plants; over 40% efficiency can be considered…

Analysis

A sustainable future: Developing renewable energy potential is key to the kingdom’s economic ambitions
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Saudi Arabia’s efforts to alter its energy mix should see major investments in renewable sources. At the forefront of recent moves in the sector are solar and wind projects, with Khalid Al Falih, minister of energy, industry and mineral resources, announcing in early 2017 that at least 10 GW would be generated from both energy sources by 2023. The overhaul of the sector will require sizeable investment, perhaps as much as $50bn, according to Al Falih. As a result, renewables represent one…

Interview

Renewed optimism: Thamer Al Sharhan, Managing Director, ACWA Power, on the forthcoming deployment of renewable energy
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Interview:Thamer Al Sharhan What role will renewable energy play in Saudi Arabia’s energy mix in the near future? THAMER AL SHARHAN: There is a renewed sense of optimism surrounding renewable energy in Saudi Arabia. The recent bids launched in the Kingdom for solar photovoltaic (PV) and wind power projects indicate a clear ambition to reach 9.5 GW of renewable energy capacity by 2023, which will then represent a little over 10% of total generation capacity. Achieving this would reflect…

Analysis

Atomic growth: A range of initiatives and investment could see nuclear power generation take root
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Looking forward to 2032, the King Abdullah City for Atomic and Renewable Energy (KACARE) estimates that 13-14% of Saudi Arabia’s power will be generated by nuclear reactors, and an eventual goal has been set of supplying 17.6 GW of power to the national grid. In addition, the Kingdom hopes that this investment will not only help meet growing electricity demand, but also provide a platform for research and development (R&D) growth. The atomic energy industry provides high-value jobs,…