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Thursday, April 24, 2008

ELECTRICAL POWER SYSTEMS (ELP)

Saudi Arabia has one of the highest per capita power consumption in the world.
Demand for power is growing at an average of seven percent annually, and the SAG is barely keeping up with this growth. Industry experts believe that the government has to add 50,000 MW of generating power over the next 23 years. The SAG is planning to invest $30 billion to increase electrical capacity by 20,000 MW by 2010. Private investors are also expected to invest and participate fully in this growth. With the stalling of the Gas Initiative, planned private power investment is on hold and the SAG is actively pushing new state-led power projects. By 2005, new capacity will come on stream with the completion and commissioning of the Ghazlan plant, Shuaiba plant, and expansion of Tabuk.

In line with its privatization efforts, the SAG brought about a merger between the Saline Water Conversion Corp. (SWCC) and Saudi Electricity Co. (SEC) to carry out independent water and power project (IWPPs) in partnership with developers. Reform in the electricity sector is advancing slowly in the need to re-price services, establish quality control standards, promote private investments, and protect consumer rights.

In May 2001, the SAG approved the formation of the Gulf Interconnection Authority (GCIA), which will be responsible for connecting the national grids of the Gulf Cooperation Council (GCC) states, which include Saudi Arabia, Kuwait, Bahrain, Qatar, Oman, and the United Arab Emirates. The company will develop the scheme on a build-operate-transfer (BOT) basis. The initial phase of the grid connecting the Northern Gulf region, including Bahrain, Kuwait and Saudi Arabia, will stretch some 1,200 kilometers and is expected to come on stream in 2008.

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