Saudi power sector needs $59 bln investments in next five years

Saudi Arabia will need to invest $59 billion in its power generation, transmission and distribution network over the next five years to meet rising demand from a growing population and expanding economy, according to a recent report.

Of the $59 billion, the Kingdom will have to spend $36 billion in electricity generation and $23 billion in building the transmission and distribution network, according to the “GCC Power Market” report issued by Middle East Electricity (MEE), an annual international trade event for the power industry.

Overall, the GCC will require $131 billion in combined investment to cope with rising power demand. The United Arab Emirates will have to spend $22 billion in the power generation sector and $13 billion for transmission and distribution.

Despite the region’s current power-generating capacity of 157 Gigawatts (GW), the six states will still require $81 billion investment for another 62GW of increased capacity and $50 billion for additional transmission and distribution.

Meanwhile, the report said that much of the investment is likely to come from public-private partnerships (PPP) if a regulatory framework is introduced to incentivise independent power producers (IPP).