Powering Ahead

A 3D Model of the Fujairah II power and desalination plant .

How ADWEA has led the way in PPPs for power and water projects in the Middle East.

The Middle East is engaged in a power struggle. Governments are racing to meet the skyrocketing demand for electricity and water of increasingly urban and industrialized societies, and are always in danger of falling behind.

In 2009 alone, power consumption in Abu Dhabi rose 11 percent to 6.255MW, the emirate’s largest ever annual increase. In 2010, peak power demand is likely to reach around 7.600MW, predicts the Abu Dhabi Water and Electricity Company.

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Other countries are facing a similar mountain to climb. Saudi Arabia, the largest economy in the Middle East, is forecast to have power needs of 65.000MW in 2018.

Last year is was unable to satisfy consumption levels, which at 41.200MW outstripped the kingdom’s power capacity. Abu Dhabi, on the other hand, is meeting its needs comfortably, with an installed capacity of around 10.000MW.

To facilitate the development of the power and desalination sector, governments in the region turned to public private partnerships (PPPs) to finance Independent Water and Power Producers (IWPPs). Abu Dhabi is drawing power and water from eight IWPPs.

The Fujairah II project, which is currently in commission and which will supply both the Northern Emirates and Abu Dhabi, will be the largest in the GCC. Across the region, power and desalination projects are the result of partnerships between the government and private companies.

IWPPs in the Middle East differ from the common definition of a PPP. While the government will typically help out the private company involved in the project with direct or indirect subsidies, it will also hold a stake in the venture. The adaptation of the concept has varied, and different models have emerged.

Oman endorsed the private ownership of its power infrastructure early on, and has gone further down the route of privatisation than any other country in the region, even allowing for 100 percent private ownership.