Business Forum: Opportunities in Water and Electricity - Al-Barrak

BUSINESS OPPORTUNITIES IN SAUDI POWER SECTOR U.S. – Saudi Business Opportunities Forum 5-7 December 2011 Atlanta-U.S.A1

Electricity Industry in Saudi Arabia  Starts in the 50`s 100% private utilities .  Late 70`S consolidated into four major regional power companies (SCECO).  In 2000 All operating entities merged in one company Saudi Electricity Company (SEC).  SEC owns 85% of generation and 100% of transmission and distribution.  The government involved as shareholder and regulator .2

SAUDI power sector TODAY  Largest electricity system in the region.  Assets exceeds US$70 billions.  Over 52,000 MW installed capacity.  48,000 MW peak demand and 250MMWH.  160,000 Miles of transmission& distribution lines  Serving 6 million customers .  Revenues 8.5 US$ bln with 7-8% annual growth .3

GROWTH (2001 – 2011) No of customer Peak load Available Transmission Energy DATA (GWH) ( Million) (MW) generation (MW) (KM) 2001 3.6 23000 24000 30000 114000 2011 6.2 47000 52000 48000 240000 Growth (%) 72% 105% 102% 65% 101%4

CHALLENGES  High growth in demand ( will continue 7- 8%).  High growth in fuel consumption.  Low tariff for domestic (2.2 US cents/kwh) .  Low average load factor (55%) seasonal.  Inefficient old of generating units.  High capital- investment.5

Opportunities  Replace all inefficient generating units.  Build more capacity and more interconnection.  Promote energy conservation initiatives.  Load management programs (time of use tariff).  Introduce smart grid and smart systems .  Encourage and support renewable energy.6

RECORDED & FORECASTED LOADS MW7

FUTURE CAPITAL INVESTMENT Over the next 10 years: Generation expansion US$ 40 billions Transmission expansion US$ 24 billions Distribution expansion US$ 16 billions Total capital investment US$ 80 billions9

major Future Generation projects Year Project name Capacity (MW) Date in Service Jeddah South PP (EPC) steam 2,600 2015 2012 Rabigh 2 PP( IPP) steam 1,200 2015 Dheba PP (IPP) ccpp+steam 1,800 2015 2013 Gizan pp (EPC) steam 2,600 2016 Ras Alkhair pp (IPP) 2,600 2016 2014 Al-Shogaig 2 PP (? ) 1,200 2017 Duba 2 PP ( ? ) 800 2017 2015 Alogair PP 2,600 2018 Ras Abigamis 2,600 2019 Total investment US$40 billions10

Ipp program  Private power production is a partnership .  SEC partnership 20-50 % .  Long term power -off take-purchase agreement.  SEC provides the land and fuel .  30- 40% of future generation will be IPP .  20/80 equity/debt ratio.6

SUCCESSFUL IPP PROJECTS  Three IPP Projects under development: 1. Rabigh Power Plant (Awarded July2009) • 1200 MW / HFO • INVESTMENT US$ 2.5 billion • IRR > 8.45% 2. Riyadh Power Plant 11 (Awarded July 2010) • 1800 MW / CCPP/GAS • INVESTMENT US$2.1billion • IRR > 6% 3. Gorayah IPP (Awarded Sep. 2011) • 4000 MW / CCPP /GAS • INVESTMENT US$ 3.5 billion • IRR > 7.5%15

KINGDOM’S INTERCONNECTION STRATEGIC PLAN11

Future 380KV transmission lines projects Year Project Length Miles Date in Service BISHA_DAWASIR +2 substations 320 2015 2012 5th 380 KV LINE TO CENTRAK 250 2015 MADINAH-HAIL 230 2015 RIYADH-JEDDAH DC line 500 2016 2013 TABUK-TABARGAL +2Substations 380 2016 WEST _SOUTH 2ND LINE 320 2016 2014 MADINAH-TABUK DC Line 380 201712

Future 380KV transmission /contd.. Year Project Length Miles Date in Service Tabuk-Tabarjal +Substations 200 2017 2014 Umluj-Wadjh +Substations 250 2017 South-West 2nd line 300 2018 2014 Jouf-Tabarjal 100 2018 2015 Al-grayat- Tabarjal 160 2019 capital cost US$25 Bln13

BUSINESS OPPORTUNITIES As an EPC contractor. Material and Equipment supply. Local manufacturing and services. Participate in IPP projects . Opportunity in engineering services. Invest in new and renewable energy.16

conclusion  High growth in demand will continue 6-7%.  75-80 billion US$ for capital investment.  Good opportunities for U.S. companies.  Investors have the opportunity . Yes, Big challenge, But great opportunities !!!17

For more information you can visit Saudi Electricity Company web page at : www.se.com.sa18

Generation Capacity generation capacity installed should meet the expected 7% increase in peak demand and a reserve margin. Generation capacity (GW) 100000 90 90000 74 80000 70000 59 60000 50000 41 40000 30000 20000 10000 0 SEC Installed & new capacity IWPP Installed capacity IPP Installed capacity SWCC Installed capacity Peak Load total capacity8

Business Forum: Opportunities in Water and Electricity - Al-Barrak

by Patrick Ryan on Dec 23, 2011

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Business Forum: Opportunities in Water and Electricity - Al-Barrak — Presentation Transcript