GCC power demand increaces 100,000 megawatts

Dec 22, 2007 - Bahrain Tribune

(MENAFN - Bahrain Tribune)The Kingdom's electricity infrastructure was under duress given the spiralling demand, even as it awaited a $26 billion upgrade of its power grid.

All the energy-rich countries of the Gulf share a similar predicament - providing sufficient electricity for their booming economies. The World Energy Council estimates that the six countries of the Gulf Cooperation Council (GCC) - Bahrain, Saudi Arabia, Qatar, Oman, Kuwait and the United Arab Emirates - will require 100,000 megawatts of additional power over the next 10 years to meet the surging demand.

And the GCC countries have already committed investments of some $100 billion to the power sector.

Bahrain needed an additional 1200 MW of capacity by the year 2010 at a cost of $900 million, its neighbour Saudi Arabia a staggering 20,000 MW ($15 billion), United Arab Emirates 6600 MW ($5.1 billion), Kuwait 3,400 MW ($2.5 billion), Oman 1,100 MW ($900 million) while Qatar is to add an additional capacity of 800 MW at a cost of $600 million, the Middle East Economic Digest said.

In 2006, the Middle East's 5.7 per cent economic growth rate was almost twice that of the world's advanced economies. But powering that growth is placing an enormous strain on its electricity infrastructure.

According to BP's 2007 Statistical Review of World Energy, electricity production in the Middle East grew 8.9 per cent between 2005 and 2006, faster than the growth recorded in any other region, including Asia Pacific, which grew by 8.5 per cent. Yet, power production was to scale up to the soaring demand.

"More importantly from the global perspective as Mid East power production rises to meet surging demand, more hydrocarbons that might once have been exported are instead being burned to create electricity for local consumption. And that means less oil and natural gas will reach the global market," the report said.

The creation of the GCC Power Grid, a multi-billion-dollar project that will link the six GCC countries with an integrated electricity grid by 2010 is expected to give a fillip to the power scenario, even as the six nations pump in major investments into the expansion of the national and regional power grids. The eastern power station project was expected to double Bahrain's current capacity between 2009 and 2020 and meanwhile, the kingdom has stated its readiness to buy electricity from Saudi Arabia to meet anticipated shortfalls.

In United Arab Emirates, the government plans to expand its 9,500 MW of installed capacity by over 50 per cent over the next 10 years while Kuwait with one of the world's highest per capita rates for electricity consumption needs investment of $4 billion to expand capacity over the next 10 years. Here, electricity demand is expected to rise at around 7 to 9 percent per year over coming years. In Oman, power consumption was increasing at 5 per cent per year and the government estimates electricity demand in 2015 will be 75 per cent higher than it is today. Oman's three new power plants - Al Kamil Power, AES Barka, and Dhofar Power - were a part of the effort that will boost the country's capacity from 2,544 MW in 2006 to 4,634 MW by 2013.

The other major project is the Saudi-Egyptian Power Grid. In September, Egypt confirmed the technical feasibility of the electrical interconnectivity of the Saudi and Egyptian power grids. These two grids are seen as the nucleus of a Middle East pan-Arab power grid that will eventually link to the world's largest electrical interconnection scheme, the Mediterranean Ring.