INVESTMENTS IN POWER SECTOR
FOR ECONOMIC GROWTH
Saudi Economic Forum
1-2 March 2011
Riyadh
GROWTH (2000 – 2009)
No of
DATA customer
( Million)
Peak
load
(MW)
Available Transmis
Energy
generation
sion (GWH)
(MW)
(KM)
2000
3.6
22000
23000
30000
114000
2010
5.7
45000
48000
49000
198000
Increase
2.1
23000
25000
19000
84000
Growth
(%)
58%
104%
108%
63%
73%
2
projects Under Execution
Generation 174 projects
US$18 bln .
Transmission 290 projects
US$14 bln.
Distribution 170 projects
US$ 2.3bln.
Total 634 projects
US$ 34.3bln.
will be in operation 2010-2014
LOAD FORECAST
MW
)4(
FUTURE CAPITAL INVESTMENT
Over the next 10 years:
Generation expansion
US$45 billions
Transmission expansion
US$ 22 billions
Distribution expansion
US$ 13 billions
Total capital investment
US$ 80 billions
Future Generation to meet the demand
Year
Project name
Rabigh Steam Expansion
2010
PP-10 (Steam)
Duba PP (IPP)
Al-Shogaig PP
Al-Jubail / Ras Al Zour
2011
Jeddah South
Al-Shogaig PP
Al-Jubail / Ras Al Zour
2012
Al-Shogaig PP
Duba PP
Jeddah South
6
Capacity (MW)
2,400
990
500
1,200
630
1,200
1,200
1260
800
250
600
Date in Service
2014
2014
2014
2014
2015
2015
2015
2016
2016
2016
2016
Al-Jubail / Ras Al Zour
2013
Al-Ogair / Salwa PP
Jeddah South
Al-Ogair / Salwa PP
Jeddah South
2014
Al-Ogair / Salwa PP
Al-Shogaig PP
2015
2016
Al-Ogair / Salwa PP
Al-Shogaig PP
Al-Jubail / Ras Al Zour
total capacity: 25000 MW
7
630
630
600
1260
600
630
400
1,260
400
1,260
2017
2017
2016
2017
2018
2018
2017
2019
2018
2020
capital Cost : US$ 40bn
380KV future transmission projects
Year
Project
HAIL-ALJOUF-380KV
2010
ASIR_NAJRAN 380KV
GAISOUMAH -ALFADLI 380 KV
BISHA_DAWASIR 380KV
2011
5th 380 KV LINE TO CENTRAK
MADINAH-HAIL
RIYADH-JEDDAH DC line
2012
TABUK-TABARGAL
WEAST _SAUTH 2ND LINE
8
Length KM
Date in Service
300
400
250
500
400
360
800
600
500
2014
2014
2014
2015
2015
2015
2016
2016
2016
IPP PROGRAM
 SEC will Continue to encourage private investors
to build, operate and own power projects .
 30 – 40 % of
Future generation will be IPP .
SEC partnership will be
20%-50% in the equity.
Long term power purchase agreements (20years)
With reasonable return on investment .
9
IPP PLANNED PROJECTS
US $ 15bn TO BUILD 12 GW
NAME OF IPP
PROJECT
CAPACITY
(GW)
INVESTMENT
BlnUS$
PROJECT
COMPLETION
QURAYYAH
1.8
2.3
2014
DHEBA
1.6
2.1
2015
SHUQAIQ
1.6
2.1
2015
ALOGAIR
2.4
2.8
2016
JEDDAH
SOUTH
2.4
2.8
2017
RAS ALZOUR
2.4
2.9
2019
10
Conclusion
The growth of electricity demand will
continue 7-8%.
 Massive investments (80 billion US$).
30% of generation expansion as IPP .
Private sector have the opportunity .
Private sector have responsibility
Infrastructure
Technology and Saudi work force
11
12
Power Industry in Saudi Arabia
 Starts in the 50`s as 100%private utilities .
 Late 70`S consolidated into four major power
companies (SCECO’s).
 Mid 2000 All operating entities merged in one
company :
Saudi Electricity Company (SEC).
 The government involved as shareholder .
13
SAUDI ELECTRICITY COMPANY
 Largest electric utility in the region in terms of
capacity ,market capital and shareholder’s equity.
 Serving the largest economy in middle east and
6million customers in 12000 cities ,towns and villages.
 Owns 85% generation and 100% T&D and retail .
 Total assets over 60 bn US$.
 Annual revenues US$ 6bn with 6% annual growth.
 50 GW installed capacity with 8% growth .
 (AA- ) credit rating
14
Scope of Operations
15
CHALLENGES
 Electricity is the basic infrastructure .
 Power is capital-intensive infrastructure projects.
 High growth in demand ( will continue 7- 8%).
 High consumption for residential use (55%).
 Low average load factor (60%) seasonal.
 Inefficient old of generating units.
WHY IPP?
 Providing Financial Option for Highly Capital
Intensive Generation Projects .
 Helping To Re-Direct Available Funds To T&D
(Monopoly Activities)
 Reallocation Expenditure From CAPEX To
OPEX.
 Avoiding Mismatch Between Medium Term
Financing and Long Life PP Projects.
17
SUCCESSFUL IPP ROJECTS
Two IPP Projects in process:
1. Rabigh Power Plant (Awarded July 2009)
•
•
•
•
1200 MW / HFO
IPCOD APRIL 2012
Investment 2.4 billion US$
IRR 8.5% with 20% for SEC
2. Riyadh Power Plant 11 (awarded last month)
•
•
•
•
18
1800 MW / GAS
IPCOD APRIL 2013
INVESTMENT 2.3 billion US$.
IRR 6.5% with50% for SEC
Year
2013
2014
2015
2016
Project
Tabuk-Tabarjal
Umluj-Wadjh
South-West 2nd line
Jouf-Tabarjal
Al-grayat- Tabarjal
Madinah-Tabuk DCLine
investment of 24 bn US$.
19
Circuit Length KM
300
250
500
150
200
800
Opportunities
 Building more power generation capacity .
 Replace all the old generation units.
 Development of new power plants as an IPP.
 Promote energy conservation initiatives.
 Load management programs (time of use tariff).
 Introduce smart grid and smart meters .
 Encourage and support renewable energy.
Conclusion
The growth of electricity demand will
continue 7-8%.
 Massive investments (80 billion US$).
30% of generation expansion as IPP .
Private sector have the opportunity in these
expansions.
The challenges are great, but the
opportunities are greater
21
SAUDI NATIONAL GRID by 2020
22
Saudi power plans
 First long-term electricity plan developed 1979.
 Between 1980-2000 regional planning by SCECOS.
 2003 SEC issued the first integrated power plan.
 10- year forecast becomes more practical in KSA.
 Near term 5-year plan window used today.
 periodic update of the plan every tow years.