Saudi to pump SR134bn into water, power in 2014

Saudi Arabia is planning to invest nearly SR134 billion in water and electricity projects in 2014 to face a rapid rise in domestic demand, the Gulf kingdom’s water and electricity minister has said.

Abdul Rahman Al Hussein said the investments include SR100 billion for power projects and SR34 billion ($9billion) for water.

He also said the world’s largest oil exporter is pushing ahead with plans to “fragment” the giant government-controlled Saudi electricity company (STC) into four firms to cope with the new projects and the surge in power demand.

“STC has an autonomous budget and we have already allocated SR100 billion for the projects which we will carry out in 2014…they include new power plants, completion of projects under construction and maintenance of existing units,” the minister told the London-based Saudi Arabic language daily Asharqalawsat.

He said the projects are needed to face rapid growth in demand of an average 9% a year, adding that allocations for the water sector cover the execution of new projects, operation and maintenance of desalination plants and sewage networks.

He said the projects would be funded through an interest-free government loan of SR70 billion besides borrowing from local banks and private sector investments, adding that the private sector would be given a share of the projects.

“Next year, we will also see the birth of four power companies within plans to fragment STC to generate three other companies for electricity generation, transmission and distribution…the transmission firm has already been born and become autonomous.”

The paper cited STC figures showing Saudi Arabia, the largest Arab country by area, needs to invest nearly SR500 billion in the power sector in the next 10 years and that around SR150 billion would come from the private sector.

 

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