Sectorial Report on

Saudi Arabia Electricity

July 2015

WWW.JEG.ORG.SA

Sectorial Report on Saudi Arabia Electricity, 2015

TABLE OF CONTENTS

Executive Summary 3
Introduction 5
Kingdoms Power Sector Structure Timeline Chronological Events 6
Saudi Arabian Power Generation Sector 7
Fuel Mix Electricity 7
Installed Capacity and Planned Additions Electricity 8
Saudi Arabian Power Consumption 10
Power Consumption Sectorial Analysis 10
Power Consumption Regional Analysis 12
Saudi Arabian Power Transmission Sector 14
Saudi Electricity Company (SEC) 14
Saudi Arabian Electricity Tariff 17
Residential Tariffs 17
Commercial, Government, Agriculture, and Mosques Tariffs 17
Industrial Tariff 18
Global Electricity Price Comparison with the Kingdom 18
Energy Alternatives to Oil and Gas-based Generation Vision 2032 19
Renewable Energy 19
Nuclear Energy 19
Energy Efficiency Measures 20
Regional and Broader Sharing of Power 20
Private Players in the Power Sector of Saudi Arabia 21
Marafiq Private Power and Utility Company for Yanbu and Jubail 21
Yanbu 21
Jubail 21
ACWA Power International 21
Shuaibah Water and Electricity Company 21
Rabigh Arabian Water and Electricity Company 21
Shuqaiq Water and Electricity Company 21
Rabigh Electricity Company 21
Jubail Water Electricity Company 21
Conclusion 22
Glossary 23
References 24

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Executive Summary

Saudi Arabian economy is at a transition point, and this report attempts to realize the potential of
non-oil economy, which if successfully implemented, could help the economy to rebound in
the next 510 years 01

We find that investment in public utilities is the key to recover from the previous slump,
due to over dependency on oil prices
02

The governments spending surge in the infrastructure segment, which will be a boost for
tourism, should continue to accelerate, as investors confidence hardens
03

As per the budgetary allocation, there will be major changes in the rationalization of energy
products, and exploration of clean source of energy will be the primary focus for the next
510 years 04
In this transformation phase, there needs to be participation from all the stakeholders,
including the private sector, foreign investors, and households. The business will need to adapt
a more competitive environment to accompany a more sustainable transition than the oil booms
in the past 05

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 Leading Indicators 2014 Compared to 2013 Saudi Arabian Power Industry

Growth of Consumption to Growth of Total Peak Loads to

274,502 GWH 56,547 MW

5.9% 10.1% 6.4%

6.9% 7.96%

Growth of Installed Capacity to Growth of Transmission Networks to Growth of Consumers to

48,624 MW 59,797 km Circular 7,602,279

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Introduction

Saudi Arabia, with 16% of the total proved oil reserves of the world, remains the leader in the production and export of petroleum liquids for over
a decade. The crude oil industry has propelled the Kingdoms economy to strong growth in recent years, with a real Gross Domestic Product (GDP)
growth, averaging 5.42% from 2011 to 2014. The country has benefited from high oil prices and output until mid-2014.
Kingdoms fuel mix (for electricity) strikes a resemblance to its image of being the largest oil exporter, with around 50% of the Kingdoms electricity
needs being met by fuel oil and diesel, while gas providing the rest. It is estimated that more than 500,000 barrels/day of oil (since 2011) are
burned for power generation, with summer peak demand topping at 900,000 barrels/day.
In regard to electricity, the Kingdom has one of the highest per capita consumption rates in the world [around 8,161 Kilo Watt Hour (kWh)/capita],
which is almost three times more than the worlds average. The demand in correspondence has grown at a much higher pace of around 58%
Compound Annual Growth Rate (CAGR) annually. The peak load has been growing annually at a rate of 7.86 (20132014).

Peak Load
62,260 MW

56,547 MW
52,380 MW

2013 2014 2015

Source: The Electricity & Cogeneration Regulatory Authority (ECRA) May 2014

The residential sector consumes about half of the electricity supply, closely followed by the industrial, commercial/trade, and government facilities
at 19%, 15%, and 13%, respectively. Saudi Arabia is facing a sharp rise in the demand for power, driven primarily by population growth, rapid
expansion of the industrial sector, higher cooling demand during the summer, and low end-user prices.
Kingdoms leadership has been instrumental in pointing out the urgency to expand the current installed capacity and look for alternatives, in terms
of fuel mix for power generation. By 2032, the Kingdom plans to add a considerable amount of capacity through alternative and renewable-based
generation, solar being the most prominent source [41 Gigawatt (GW)], followed by nuclear (17.6 GW) and other renewables (13 GW).

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Kingdoms Power Sector Structure Timeline
Chronological Events
Saudi Arabias electricity industry began its journey as a private entity in the early 1930s, with private entrepreneurs, establishing generation units
for their business needs. With progressing time and the demand for power, the industry has been maturing.

Private Government Agencies Sector Restructuring

19301972 19722000 2000Present

1930 Private entrepreneur establishes 1972 Department of Electricity Services 2000 SEC (2000)
generation units for their business needs.
1974 Industry and Electricity Agency 2002 ECRA
Selling excess
1975 Electricity Affairs Agency 2003 Ministry of Water and Electricity
Small commercial companies
1976 Electricity Corporation 2006 Electricity Law (RD/M56)
1949 first private company in Dammam
to supply to new born oil business, primarily 19761981 Formation of SCECOs (East, Present IPPs coming up, restructuring of
ARAMCO West, South, Central, and North) the sector
1961 Department of Electricity Affairs
(Ministry of Commerce)
Source: ECRA

Currently, the Kingdom has a single vertically integrated electricity company, Saudi Electricity Company (SEC), which owns all the three verticals
of the power industry, including most of the generation, complete transmission, and virtually all distribution capacities, with an exception in
the industrial city of Yanbu, where Marafiq (a private integrated utility company) is responsible for generation, transmission, and distribution of
electricity. However, there are a considerable number of other private generators and Independent Power Producers (IPPs) that produce power and
sell all of their generation to SEC or supply to isolated loads (not connected to the grid). Quite a few Industrial consumers, which are having large
demand, also have internal generation (captive generation), which is used to feed a substantial portion of their own load.
The government has been very considerate to open the electricity market for restructuring. This decision to restructure the market and open it for
competition primarily in the generation space would help the Kingdom in bridging gap between supply and ever increasing demand. Also, with
several IPPs coming up, alternative means of power generation would gain more importance.
Electricity and Cogeneration Regulatory Authority (ECRA) of the Kingdom has prepared a detailed restructuring plan under the banner of Electricity
Industry Restructuring Plan (EIRP). ERIP is primarily divided into three major milestones detailed as follows:
Unbundling SEC from being a vertically integrated monopoly in creating a market for open generation and distribution
Create a separate transmission company, which would operate independently of the generation, distribution, and retail businesses
To encourage the concept of the Parallel Market where large consumers can directly procure electricity from suppliers of their choice at a
mutually agreed price and conditions

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 Saudi Arabian Power Generation Sector

Fuel Mix Electricity

Saudi Arabia, being one of the largest producer and exporter of crude globally, has primarily oil and gas-dominated generation mix. The cheap price
of these fuels as compared to the international market and availability in large volume makes them a first choice for power generation.
Electricity Fuel Mix (2014)
0.9%
14.2%

Diesel
Combined Cycle
50.4% Steam
Gas

34.5%
Source: ECRA Annual Report 2014

Kingdoms electricity generation fuel is entirely dependent on conventional fossil fuels, with natural gas fuelling the first 50%, and oil contributing
to another 50% of the generation. Kingdoms fuel mix presently has no additions through renewable-based sources.

Actual Generating Capacity by Unit Type (MW)

50,000 48,624
45,908

40,000

30,000
24,52724,416

20,000 16,782
14,686
10,000 6,899 6,342
415 464
0
Generating Activity Diesel Combined Cycle Gas Steam

2014 2013
Source: ECRA Annual Report 2013 and 2014

With Kingdoms demand for electricity growing at a pace of 58% CAGR annually, the government in its attempt to resolve the issue is aggressively
trying to switch towards nuclear and renewable-based generation.

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 Installed Capacity and Planned Additions Electricity
The current generation base has been growing at a rate of 56% CAGR annually to cater to the increasing demand. The total installed capacity
stood at 48.6 GW in 2014 when compared to 45.9 GW in 2013, an increase of 5.9% annually, showing the government commitment towards
the same.

Installed Generation Capacity

48,624 MW
45,908 MW

2013 2014
Capacity Additions 20132014

Project Name Technology Capacity (MW)

Rabigh Power Plant Steam Generation 2,100
Qurayyah Power Plant Steam Generation 520
Sharourah Power Plant Gas Generation 128
Source: ECRA Annual Report 2013 and 2014

The current installed capacity of 48.6 GW is well distributed throughout the Kingdom, through a network of more than 50 power generation units
covering all the major areas.
The following Electric Power Generating Stations depicts all the power stations in the Kingdom owned by SEC:

Electric Power Generating Stations

AI-Qurayyat
Gas Generation Station
Ar-Ar
Tubarjal Combined-cycle Station

Diesel Generation Station

Al Jawf Rafha Steam Generation Station
Western Region
Tabuk Solar Generation Station
AI-Qaysumah

Duba Hail Safaniya

Al-Aula
Ghazlan
AI-Wajh
Buraydah Berri Juaymah
Shadqum
Dammam
Qassim Riyadh
Omlaj AI-Qaryah
Khaybar
PP10 PP9
Othmaniah
PP5
Al-Madinah AI-Hanakiya PP7 Faras
Yanbu
Al-Munawara IPP 11 PP8
Mahd-Adhahab PP4
Rabigh

Alkhurmah
Turbah
Central Region
Jeddah
AI-Mukarramah AI-Taif
Ranyan Eastern Region
Ash-Shuaybah
Bishah
Joba
Baha
Aseer

Tihama Southern Region

Sharurah
Najran
Farasan Islands
Jazan

Source: ECRA Annual Report 2014

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 With the ongoing restructuring of the electricity sector in the Kingdom and increasing demand, the government has planned several new additions
to the existing capacity in participation with the private players to address the issue. The planned capacity additions to the present fleet includes
(SEC will buy the complete production of these electricity projects):
Planned Generation Capacity Additions Non-renewable Based

ProductionCapacity Private Sector Investment in

Project Name Date of Completion
Megawatt (MW) the Project Capital

Rabigh-2 project for independent

2,050 50% June 2017
production
Fadhili project for dual production
in cooperation with Saudi Aramco 1,434 40% February 2020
(under construction)
Jazan project for dual production
3,800 40% August 2019
in cooperation with Saudi Aramco

Source: ECRA Annual Report 2014

With these conventional fuel-based projects (7,284 MW) in the implementation phase and others in the discussion phase, the total installed
capacity of the Kingdom is expected to touch more than 120 GW (est.) by 2032. Also, with the ongoing restructuring of power industry, a lot
more of capacity additions are expected to come through IPPs, which is expected to have a mix of both conventional and renewable-based
generation.
ECRA is promoting private investments in all three segments of the power industry. As per a recent study, conducted by ECRA, it is estimated
that the total funding needs of the electricity services until 2020, the total funds required for generation, transmission, and the distribution sector
expansion would be Saudi Riyal (SR) 526 billion. The estimated funding required for implementing electricity projects through 2020 is as follows:
Estimated Funding

Activity Required Funding (SR Billion) Total Funding Required (%)

Generation 335 63.7%

Transmission 121 23%

Distribution 70 13.3%

Source: ECRA

The estimates of the above table are based on the assumptions that by 2020, the peak load will be 71,940 MW and the generation reserve will
be 15%.

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 Saudi Arabian Power Consumption

Power Consumption Sectorial Analysis

The power consumer base has a mix of residential, commercial, industrial, agricultural, desalination, and governmental organizations. Residential
consumers are the segment, which consumes about 50% of the total power generated in the oil rich Kingdom of Saudi Arabia. This is followed
by industrial (18.76%), commercial (15.37%), and governmental segment (13%). Agricultural (1.75%) and desalination (1.01%) (referred to as
others) form a small segment of the overall power consumption pie in the country. The table below represents the comparison between 2013 and
2014 power consumption (percentage) by sector:
Comparative Amount of Power Consumption for 20132014 by Consumption Sectors

Consumption Category 2013 2014

Residential 48.96% 49.51%

Commercial 15.09% 15.37%

Governmental 12.41% 12.99%

Industrial 19.90% 18.76%

Others 3.64% 3.37%

Source: ECRA Annual Report 2013 and 2014

Therefore, it can be inferred that residential consumption will drive the consumption of power in the country by 2015 and beyond. Residential
segment has been driving the power demand in the Kingdom due to:
Increased demand for cooling over the years (average summer temperature +45 C)

Average Temperature (C) for Saudi Arabia* (20002012)

50 44 45
43
45 41 41
40 35 36
35 30
Temperature (C)

29 28 29 28
30 26 26
24
25 20 20 21 21
20 16 15
15 10 9
10 7
5
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Average High Temp Average Low Tempertaure

Source: World weather online *Temperature of Riyadh has been considered.

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 Increasing population increasing number of power consumers

Growth of Electricity Consumers in Saudi Arabia

76,02,279
71,15,733

2013 2014
Source: ECRA Annual Report 2013 and 2014

The cheap availability of power (subsidized by the government in the form of cheap fuel for power generation)
Average subsidization rate 77.3%
Total subsidy as share of GDP 8.3%
Fuel Subsidy (USD Billion)

Fuel 2011 2012 2013

Oil 43.4 46.7 48.1

Electricity 14.6 15.2 14.0

Price (USD/million BTU)

Fuel Type
Paid by the Kingdom's Electricity
International
Producers
Heavy Fuel Oil 0.43 15.43

Gas 0.75 9.04

Diesel 0.67 21.67

Crude Oil 0.73 19.26

Sources: International Energy Agency, ECRA June

Without this fuel subsidy by the government (estimated, in 2013, to be around SR 150 billion), the average electricity unit cost in 2013 would have
been about SR 0.80/kWh as compared to the present value of 0.26 (maximum price).

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 Due to the above-mentioned reasons, the electricity demand has grown tremendously over the years and is expected to follow the same trend.
The peak load has grown by 7.96% Y-o-Y to reach 56.5 GW in 2014 as compared to 52.4 GW in 2013. The government has taken keen steps
to bring down the consumption through the introduction of energy efficiency measures on the demand side and adding new capacities to the
existing fleet on the supply side.
Comparative Amount of Sales for 20132014 by Consumption Sectors
3.64% 3.37%
12.41% 12.99%

19.90% 2013 48.96% 18.76% 2014 49.51%

15.09% 15.37%

Residential Commerical Industrial Government Others

Source: ECRA Annual Report 2013 and 2014

The kingdoms electricity demand and consumption are unique in a way that it is the residential sector that drives the consumption and not the
industrial sector as is the case with the rest of the developed/developing countries globally.
In the early 1970s, industrial segment dominated the Kingdoms power horizon, but with a boom in infrastructure development in the early 1980s
and the modernization of the society, consumption in the non-industrial sector (primarily, the residential segment) grew very rapidly, now covering
50% of the total power generated. Also, with such an extreme weather conditions in the Kingdom, comfortable lifestyle has become the first
priority, thereby pushing up the demand.

Power Consumption Regional Analysis

The regional breakdown of electricity consumption in Saudi Arabia is typically based on the geographical periphery and the type of consumers
bases. The western and the eastern regions score high in consumption pattern, owing to large residential consumer bases in these regions. While
the eastern province with its oil fields have a larger industrial demand, the southern province has, however, a very low consumption, owing to its
majority of the region being covered by the great Arabian Desert, thereby restricting the population as well as the penetration level of grid-based
electricity.

Regional Consumption of Power Comparative Analysis (2013 vs. 2014)

90,000,000 84,265,134
82,318,081 78,655,397 82,359,121 80,193,001
Power Consumed (MWH)

80,000,000 74,282,468
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000 23,556,738 25,559,880
20,000,000
10,000,000
0
Central Eastern Western Southern

2013 2014

Source: ECRA Annual Report 2013 and 2014

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 A closer look into regional consumption of the Kingdom reveals that the consumption rate in the central region is growing at a much higher pace
when compared to other regions, reasons being quite evident presence of cities, like Riyadh, and large population bases in the region.

Distribution of Electricity Consumption by Region (2013)

70% 65%
59%
60%
52%
48%
50%

40%
30%
30%
17% 18% 19%
20% 14% 14%
10% 8% 12%
8% 8%
10% 4% 5% 4% 4%
2%
0%
Eastern Central Western Southern
Industrial Residential Commercial Government Others

Source: ECRA 2013

The high consumption from the residential and commercial segment indicates the relative population densities of the provinces. Riyadh (central
province), being the capital of the Kingdom, explains the large government consumption in the region. Eastern region, which accommodates two
large industrial giants, Saudi Aramco and Saudi Arabian Basic Industries Corporation (SABIC), explains the high industrial consumption of this
sector. Southern being surrounded by the Arabian Desert, attribute to a very low industrial consumption and more residential consumption.
The government estimates that the total demand of the Kingdom would touch a whooping figure of 120 GW by 2032. Residential segment is
expected to dominate with more demand coming from the central, western, and southern provinces of the Kingdom.

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Saudi Arabian Power Transmission Sector

Saudi Electricity Company (SEC)

SEC has 100% monopoly over the transmission industry. The company is responsible for running the electrical system/grid, transmission of power
from the generating sites to consumption centers (wheeling of power), fault clearances, managing transmission congestion, and co-operate with
IPPs to sell/buy their produced power. Saudi Arabia has a well-laid transmission lines linking the entire stretch of the Kingdom with plenty of under
execution and new planned linkages.
Strategic Linking of the Kingdom (380 KV)

Al-Qurayyat Waad al shamal

Ar-Ar
T ubarjal

Al Jawf

AI-Badia
AI-Qaysumah
Tabuk
To Egypt Safaniya
Duba Hail
Buraydah Ghazlan
AI-Wajh Berri Juaymah
Qassim
Al -Aula Sayer Shedgum Dammam
Western Region omlaj PP2
AI-Qurayyah
AI-Madinah PP10 PP9 Faras
AI-Munawara Qassim IPP11 PP5 PPT Uthmaniyah
Salwa
Riyadh PP3
AI-Wadi
Yanbu PP4 IPP12
PP8
Al -Kharj
Rabigh

Makkah Central Region

Jeddah AI-Mukarramah
Eastern Region
Wadi Addawaser
AI-Taif

Ash-Shuaybah Baha
Namera Bishah

Abha Southern Region

AI-Shaqeq Projects in Execution

Najran
Future Projects
Jazan Completes Projects
Farasan Islands
External Links

Source: ECRA Annual Report 2014

The Kingdom boasts of more than 59,000 km circular of transmission network [110/380 Kilo Volt (KV)], which wheels the power across the
terrains of the country. With a Y-o-Y increasing the demand for electricity, SEC has planned several new transmission lines to avoid congestion of
the network.
The National Grid SA (a wholly owned subsidy of SEC) has worked continuously over the years to improve and develop a congestion free
transmission network (110/380 kV) in all the regions of the Kingdom (central, eastern, Western, and Southern provinces). The company added
5,479 km circular of transmission lines in 2014 alone, reflecting a 10.1% growth over the previous year 2013. The National Grid SA launched a
series of new projects in 2014 to enhance the existing network, ease the transmission congestion, and improve the operational efficiency. Some
of the notable projects include:

Ultra High Voltage Projects 230/380 kV

Additions of 12 transmission substations and electric breakers along with 34 transformers
Addition of new overhead and underground transmission network of more than 2,500 km circular

High Voltage Projects 110/132 kV

Addition of 45 transmission substations and 145 transformers
Addition of new overhead and underground transmission network of more than 1,000 km circular
Replacement of six transformers to improve operational efficiency

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 The transmission network is spread across all regions of the Kingdom, with their transmission length in proportion of 34.3%, 28.6%, 24.5%, and
12.6% for the central, eastern, western, and southern regions, respectively.

Relative Distribution of Length of the Transmission Networks

(110/380 kV) 2014
12.6%
34.3%

Central
Eastern
Western
Southern

25.5%

28.6%

Transmission Network Length (110/380 kV)

60000

50000

40000
Kilometre Circular

30000 59,797
54,318
20000

10000

0
2013 2014

Source: ECRA Annual Report 2014

With an aim to improve the operational efficiency of the overall transmission network, 57 new transmission substations and electric breakers
were added to the grid, indicating an increase of 8% in the number of installed substations and breakers. Also, around 325 new transformers
were added, thereby increasing the total transformer transfer energy to 230,908 Mega Volt Ampere (MVA), a Y-o-Y growth rate of 13.7 for 2014
compared to 203,006 MVA in 2013.

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 Additions to Transmission Network Infrastructure (20132014)

230,908

Total Capacity of Power Transmission

Substation Transformers (MVA)
203,006
185,000

190,000

195,000

200,000

205,000

210,000

215,000

220,000

225,000

230,000

235,000
MVA

2013 2014

2,307
Number of Power Transmission Substations
Transformers
1,982

755
Number of Power Transmission Substations
699

500 1,000 1,500 2,000 2,500

2013 2014

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Saudi Arabian Electricity Tariff

Electricity tariffs are controlled and regulated by the governmental agencies, in this case, ECRA being the one. The tariffs designed by ECRA are
made to be cost reflective, fair, affordable to end users, and easy to implement. The tariffs are issued by Council of Ministers Decision (CMD),
which set the prices.
Electricity prices in the Kingdom are among the lowest in the world, with only Uzbekistan being lower than that of the Kingdoms per unit tariff. The
tariffs are revised based on the need, with last tariff revision occurring in 2010 for the government, commercial, and industrial consumers. It was
approved by a decision of ECRAs board, using the authority passed on to it by the Council of Ministers to set tariffs for non-residential consumers,
with an upper cap of 0.26 SR/kWh. The approved tariffs, which are currently applicable in the kingdom, are follows:

Residential Tariffs
Residential Consumption Tariff
Monthly Consumption (kWh) Tariff (SR/kWh)
12,000 0.05
2,0014,000 0.10
4,0015,000 0.12
5,0016,000 0.12
6,0017,000 0.15
7,0018,000 0.20
8,0019,000 0.22
9,00110,000 0.24
>10,000 0.26

Commercial, Government, Agriculture, and Mosques Tariffs

Commercial Consumption Tariff
Monthly Consumption (kWh) Tariff (SR/kWh)
14,000 0.12
4,0018,000 0.2
>8,000 0.26

Government Consumption Tariff

Monthly Consumption (kWh) Tariff (SR/kWh)
Any quantity 0.26

Agricultural, Mosques, and Charitable Societies Tariffs

Monthly Consumption (kWh) Tariff (SR/kWh)
12,000 0.05
2,0015,000 0.1
>10,000 0.12
Source: ECRA

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 Industrial Tariff
I. Tariff from October 1 to April 30

Consumer Type Tariff (SR/kWh)

Small (plant with contracted load not exceeding 1,000 kVA) 0.12

Large (plant with contracted load exceeding 1,000 kVA) 0.14

II. Time of Use Tariff (for industrial consumers using digital meters) Applicable from May 1 to September 30

Consumption Days Consumption Time (Consumption Hours) Tariff (SR/kWh)

00:0008:00 0.10

08:0012:00 0.15
SaturdayThursday
12:0017:00 0.26

17:0024:00 0.15

00:0009:00 0.10
Friday
09:0024:00 0.15

III. Seasonal Tariff (for industrial consumers using electromechanical meters) Applicable from May 1 to September 30

(SR/kWh) 0.15

Source: ECRA

Global Electricity Price Comparison with the Kingdom

Electricity Price Comparison Globally for 2014 (US cents/kWh)
Italy 21.01
Germany 19.21
UK 15.40
Portugal 13.84
Spain 13.64
Belgium 12.68
Slovakia 12.55
France 10.74
Czech Republic 10.47
Poland 10.46
Austria 10.44
Netherlands 10.08
U.S. 10.00
Australia 9.71
South Africa 8.97
Finland 8.59
Canada 8.11
Sweden 7.87
Saudi Arabia 7.00
0 5 10 15 20 25
Sources: ECRA, Statista

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 Energy Alternatives to Oil and Gas-based
Generation Vision 2032
Renewable Energy
With an average increase of the demand by 58% annually, the stress on fossil fuel-based generation has been on all-time high. To meet up
with this ever-increasing demand in a sustainable way, the government aims to switch a considerable part of generation to renewable sources.
Saudi Arabia, by 2032, aims to have around 30% of its fuel mix from renewable sources, of which 16 GW would be through solar Photovoltaic
(PV), 25 GW through Concentrated Solar Power (CSP), 9 through GW wind, 3 GW through waste to energy, and 1 GW through geothermal-based
generations.

Renewable-based Capacity Additions by 2032

30
25
25

20
16
15
GW

10 9

5 3
1
0
Solar PV Solar CSP Wind Waste to Energy Geothermal
Sources: International Energy Agency, The International Renewable Energy Agency, King Abdullah City for Atomic and Renewable Energy (K.A. CARE)

Nuclear Energy
Saudi Arabia has plans to construct 12 nuclear power reactors over the next 15 years at a cost of over USD 80 billion, with the first reactor on line
in 2022, followed by subsequent reactors in 2027 and 2032.
The Kingdom has setup an ambitious target of 17.6 Gigawatt Equivalent (GWe) of nuclear-based generation by 2032 to provide 15% of the power
produced in 2032.

Nuclear Energy Development Road Map 17.6 GW by 2032

Site and Technology First Reactor to be 12 Reactors to be

Selection Connected to Grid Connected to Grid 17.6 GW

2013 2017 2022 2027 2032

Installation Scheduled Seven Reactors to be

to Begin Connected to Grid 9.6 GW
Sources: IRENA, K.A. CARE

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 Energy Efficiency Measures
As per a recent study, the Kingdom electricity demand is expected to grow annually at 58% and at the time the domestic use of oil is expected to
grow at 5% per annum. It is estimated that by 2035, the domestic oil consumption in Saudi Arabia would equal the production, thereby creating a
catastrophic impact on the Kingdoms economy. To avert such situation in the future, the government in conjunction with Saudi Energy Efficiency
Center (SEEC formed 2010), ministries, regulatory authorities, and other major companies launched the Saudi Energy Efficiency Program (SEEP)
in 2012.
The Kingdom through its SEEP program aims to reduce the energy intensity by around 30% until 2030 and half the peak demand growth rate by
2015 compared to 20002005.

Regional and Broader Sharing of Power

At present, Saudi Arabia has a grid connection with the neighboring countries of Kuwait and Qatar through the northern Gulf grid connection, which
allows power sharing on an emergency basis. The governments of these three countries (involved in northern Gulf grid) are in consideration of
enabling the grid usage to more power sharing to utilize the spinning reserves of each other to maintain stability of their grids.
Also, the Kingdom has plans to setup a grid connection with Egypt to take benefit of the daily variances in each other peak demand, the connection
once established is estimated to operate at a level of 3 GW.
Various other ambitious cross nation grid connection plans are on the table, connection between the Turkish and the European grids being one
among them, which will enable these nations to take advantage of the large un-used capacity of Saudi Arabia during the winter months. Such as
system once in place would enable around 10 GW of power transfer, which would be sufficient enough to meet there winter peak demands while
sending back the excessive power to the gulf during the summers when the demand peaks there.

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Private Players in the Power Sector of Saudi
Arabia
Marafiq Private Power and Utility Company Capacity: 900 MW
for Yanbu and Jubail Technology: Steam Turbine
Marafiq is Saudis first private integrated power and water utility, which 
R abigh Arabian Water and Electricity
serves the industrial cities of Jubail and Yanbu of the eastern region. Company
The companys main business focuses on generation, transmission,
and distribution of power, while its other operations include desalination Location: Rabigh City, 120 km North of Jeddah
of seawater cooling and industrial water treatment. In Jubail, the focus Shareholders: Petro Rabigh, ACWA Power, Marubeni Corporation,
is more on water utilities as a SEC supplies power in the region. JGC Corporation, and ITOCHU Corporation
Yanbu Off taker: Petro Rabigh
Currently, the utilitys generation facility at Yanbu industrial city consists Cities Supplied: Rabigh Petrochemical Complex
of nine gas turbines (with a total capacity of 517.6 MW), four steam
turbines (with a total capacity of 512.5 MW), and two diesel-based Capacity: 360 MW
gen-sets (with a total capacity of 4.2 MW). Two steam turbine units are Technology: Steam Turbine
under construction with a total capacity of 500 MW.
Shuqaiq Water and Electricity Company
Marafiq also owns transmission and distribution lines in the industrial
city of Yanbu. The utility has an underground network of 115 kV, 34.5 Location: 140 km north of Jizan, 105 km south west of Abha
kV, and 138.5 kV cables. The T&D network of the Marafiq is also

Shareholders: ACWA Power International, PIF, Gulf Investment
interconnected with 380 kV grid of the Saudi Electric Company through
Corporation, SEC, and Mitsubishi Corporation
a 380 kV interconnection. The utility supplies power to all the segments
of consumer, such as residential, commercial (through 13.8 kV cables), Off taker: Water and Electricity Company
and industrial consumers (through 115 kV cables).
Cities Supplied: Asir Region and Jizan
Total consumer base of Marafiq in Yanbu is about 15,000 power
Capacity: 850 MW
consumers from all the segments, which are growing rapidly at a rate
of 250 consumers/annum. The utility is rated high in its average power Technology: Steam Turbine
service availability index with a present index of 99.985.
Rabigh Electricity Company
Jubail Location: Rabigh City, 120 km North of Jeddah
In the industrial city of Jubail, Marafiq operates the worlds largest
Shareholders: ACWA Power International, KEPCO, and SEC
integrated water and power facility in a joint venture with SEC,
Public investment Fund of the Ministry of Finance (PIF), Suez Energy Off taker: SEC
International, ACWA Power Projects of Saudi Arabia, and Gulf Investment
Cities Supplied: Western Region Grid
Corporation of Kuwait.
Capacity: 1,204 MW (net)
The primary fuel used is natural gas, with high-speed diesel used as
a back-up fuel. The plant operates on a combination of both gas and Technology: Steam Turbine
steam-based turbines, with a total nameplate installed capacity of
2,745 MW. The entire power produced at the plant is supplied to SEC.
Jubail Water Electricity Company*
Location: Jubail Industrial City
ACWA Power International
Shareholders: SEC, PIF, Suez Energy International, ACWA, Marafiq,
ACWA Power International was incorporated in the Kingdom with a
and Gulf Investment Corporation
core business of delivery of power and desalinated water throughout
the Kingdom. Currently, it has presence in more than five countries, Off taker: SEC
including Morocco, Bulgaria, Oman, Jordan, South Africa, and Egypt. It
Cities Supplied: Jubail Industrial City and Eastern Province
currently owns a huge generation portfolio of about 6,050 MW in the
Kingdom through joint ventures and standalone units. The generation Capacity: 2,743 MW
portfolio of ACWA power includes:
Technology: Combined cycle
Shuaibah Water and Electricity Company
Location: 110 km, South of Jeddah
Shareholders: ACWA Power, PIF, MALAKOFF/KHAZANAH/TNB, and
SEC
Off taker: Water and Electricity Company

Sectorial Report on Saudi Arabia Electricity, 2015

21
Conclusion

Saudi Arabia, with more than 48 GW of installed capacity (2014) and its vision to add 68 GW (est.) by 2032 through renewable and nuclear-based
sources, places it among the most power stable countries in the Middle East. Although with regards to the consumption of power, it has one of
the highest per capita consumption rates in the world (around 8,161 kWh/capita), which is almost three times more than the worlds average. The
demand in correspondence has grown at a much higher pace of around 58% annually.

To match up with the current pace of 58% growth in demand annually, government has been instrumental to transit from the present structure
of single vertically integrated power industry to an open market structure. The government has already rolled out a road map for creating an open
market in the Kingdom.

As the Kingdom is bestowed with abundant oil and gas resources, the fuel mix for power generation is predominantly based upon conventional
fossil fuels with natural gas fuelling the first 50%, and oil contributing to another 50% of the generation. Kingdoms fuel mix presently has no
additions through renewable-based sources.

Due to the high cooling demand during the summer, when the temperature reaches beyond 45, consumption from the residential sector exceeds
industrial and commercial segments. Currently, the residential sector consumes about half of the electricity supply, closely followed by the
industrial, commercial/trade, and government facilities at 19%, 15%, and 13%, respectively. Saudi Arabia is facing a sharp rise in the demand
for power, driven primarily by fast population growth, rapid expansion of the industrial sector, higher cooling demand during the summer, and low
end-user prices.

Kingdoms leadership has, however, been instrumental in pointing out the urgency to expand the current installed capacity and look for alternatives,
in terms of fuel mix for power generation. By 2032, the Kingdom plans to add a considerable amount of capacity through renewable-based
generation, solar being the most prominent source (41 GW), followed by nuclear (17.6 GW) and other renewables (10 GW). The Kingdom is also
working upon in reducing the consumption through energy efficiency measures, although the present measures are only confined to commercial
and industrial units.

Electricity prices in the Kingdom are among the lowest in the world, with only Uzbekistan being lower than that of the Kingdoms per unit tariff.
The Council of Ministers has worked continuously to keep the tariffs low, especially for the residential consumers. The upper cap for industrial
and commercial consumer is SR 0.26/kWh, which is still much lower than the worlds average. The cheap availability of fuel and high government
subsidies has kept the tariffs for electricity comparatively low.

With several planned capacity additions in the pipeline and vision of King Salman bin Abdulaziz al-Saud to promote renewables and other
alternative source of generation, Saudis power industry is expected to grow sustainably with an assured stability and security of supply.

Sectorial Report on Saudi Arabia Electricity, 2015

22
Glossary

Acronym Expansion

BTU British Thermal Unit

CAGR Compound Annual Growth Rate

CMD Council of Ministers Decision

CSP Concentrated Solar Power

ECRA Electricity and Cogeneration Regulatory Authority

EIRP Electricity Industry Restructuring Plan

GDP Gross Domestic Product

GW Gigawatt

GWe Gigawatt Equivalent

IPP Independent Power Producer

K.A. CARE King Abdullah City for Atomic and Renewable Energy

kV Kilo Volt

kVA Kilo Volt Ampere

kWh Kilo Watt Hour

MVA Mega Volt Ampere

MW Megawatt

PIF Public Investment Fund of the Ministry of Finance

PV Photovoltaic

SABIC Saudi Arabian Basic Industries Corporation

SCECO Saudi Consolidated Electric Company

SEC Saudi Electricity Company

SEEC Saudi Energy Efficiency Center

SEEP Saudi Energy Efficiency Program

SR Saudi Riyal

USD United States Dollar

Sectorial Report on Saudi Arabia Electricity, 2015

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References

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2. http://www.iea.org/newsroomandevents/news/2014/august/summer-demand-taxes-saudi-power-sector-but-kingdom-is-working-on-solutions.html
3. http://data.worldbank.org/indicator/EG.USE.ELEC.KH.PC
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to-energy.pdf
13. http://www.ecra.gov.sa/EventsDetail.aspx?ID=47
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15. http://www.ecra.gov.sa/GCSC/en/reports.htm
16. http://www.ecra.gov.sa/GCSC/pdf/Approved%20GCSC%202011%20Annual%20Report%20annexure.pdf
17. http://www.mowe.gov.sa/English/electricitysectorstats.aspx
18. http://www.mowe.gov.sa/files/forms/%D8%A7%D9%84%D9%83%D9%87%D8%B1%D8%A8%D8%A7%D8%A1%20
%D9%86%D9%85%D9%88%D9%87%D8%A7%20%D9%88%D8%AA%D8%B7%D9%88%D8%B1%D9%87%D8%A7.Pdf
19. http://www.mowe.gov.sa/files/forms/%D8%A7%D9%84%D8%AA%D9%82%D8%B1%D9%8A%D8%B1%20%D8%A7%D9%84%D8%B3%D9%86%D9%8
8%D9%8A%2027-28.pdf
20. http://ecra.gov.sa/tariff170.aspx#.Vay0_6Sqqko
21. http://ecra.gov.sa/31_22_1.aspx#.Vay0_qSqqko
22. http://ecra.gov.sa/tariffhistory.aspx#.Vay0_aSqqko
23. http://ecra.gov.sa/tariffInGeneral.aspx#.Vax1kqSqqko
24. http://ecra.gov.sa/home.aspx
25. http://arabspring-news.com/electricity-tariff-in-saudi-arabia-at-least-in-the-world/
26. http://www.mowe.gov.sa/English/electricitysectorstats110.aspx
27. http://www.world-nuclear.org/info/Country-Profiles/Countries-O-S/Saudi-Arabia/
28. https://www.se.com.sa/en-us/Pages/AnnualReports.aspx
29. http://www.sauditem.com/13stem/download/ABSTRACT17.pdf
30. http://www.erranet.org/AboutUs/Members/Profiles/SaudiArabia
31. http://www.ijesd.org/vol7/739-A0053.pdf
32. http://www.geni.org/globalenergy/research/saudi-arabia-beyond-oil/Saudi-Arabia-Beyond-Oil-Based-Economy-Alkoblan-Yousef-Feb-2015.pdf
33. http://www.kaust.edu.sa/assets/downloads/kicp-annual-strategic-study-appraisal-and-evaluation-of-energy-utilization-and-efficiency-in-the-ksa%202014-
volume1.pdf
34. http://www.ecra.gov.sa/pdf/longtermgenerationplanningforsaudielectricitysectorstudy.pdf
35. http://www.usaee.org/usaee2012/submissions/Presentations/Austin_USAEE2012_Lantz_Farnoosh_v2.pdf

Sectorial Report on Saudi Arabia Electricity, 2015

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 36. http://www.systemdynamics.org/conferences/2013/proceed/papers/P1326.pdf
37. http://www.iea.org/newsroomandevents/news/2014/august/summer-demand-taxes-saudi-power-sector-but-kingdom-is-working-on-solutions.html
38. http://www.ecra.gov.sa/EventDetails.aspx?ID=44#.Vac_waSqqkp
39. http://www.ecra.gov.sa/upload/presentation2.pdf
40. http://www.ecra.gov.sa/upload/CEM%20Roadmap-%20Workshop-distribution.pdf
41. http://www.ecra.gov.sa/EventDetails.aspx?ID=45#.Vac_wKSqqkp
42. http://www.ecra.gov.sa/events.aspx#.Vac_wKSqqkq
43. http://www.ecra.gov.sa/reports.aspx
44. http://www.mowe.gov.sa/English/electricityResearches.aspx
45. https://www.se.com.sa/en-us/business/Pages/default.aspx
46. http://www.onlyelevenpercent.com/energy-efficiency-saudi-arabia/
47. http://www.strategic-analysis.org/wp-content/uploads/2013/03/Saudi-Electricity-Market.pdf
48. http://www.ijera.com/papers/Vol4_issue9/Version%205/AD4905171174.pdf
49. http://www.rtcc.org/2015/05/28/saudi-arabia-solar-power-exports-absolutely-realistic/
50. https://www.irena.org/DocumentDownloads/masdar/Abdulrahman%20Al%20Ghabban%20Presentation.pdf
51. http://irena.org/remap/IRENA_REmap_RE_targets_table_2014.pdf
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53. http://www.irena.org/DocumentDownloads/Publications/IRENA_Pan-Arab_Strategy_June%202014.pdf
54. http://www.marafiq.com.sa/en/operations/opr_iwppjub.aspx
55. http://www.marafiq.com.sa/en/operations/opr_dispatch.aspx
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59. http://www.acwapower.com/about-us.html
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About Jeddah Chamber

The Jeddah Chamber of Commerce & Industry is one of the oldest business
and service organizations in the kingdom. It was established by a royal
decree, dated Safar 1365 H \ January 1946 G. Since then, with the efforts of
20 sessions of the Board of Directors and experience extending more than
60 years, the chamber has been serving the national economy and business
community, contributing to its development and progress.

The Jeddah Chamber has a strategic location, next to the Ministry of Trade
& Industry and the Ministry of Culture & Information, overlooking the Jeddah
Islamic Port. This location gives it a significant economic dimension, makes
it one of the significant landmarks of the Bride of the Red.

The chamber strives to take care of its members interests and provide
distinguished services to them to contribute to the development of the
western provinces economy. A number of administrative and organizational
developments have been devised to enhance the services provided to the
members. Among the most, the chamber now has branches in provinces
different governorates, like Al Qunfidhah, Al Lith, and Rabigh, to provide
services to the business community.

From this standpoint, the chamber launched the Jeddah Economic Gateway (JEG), which is an economic online reference point
that collects and classifies various economic and investment information under one roof. JEG includes more than 2,400 reports
and studies, 65,000 statistical tables, in addition to more than 51,000 tenders and investment opportunities, and much more. JEG
provides the business community in Jeddah in particular, and KSA in general, with the best information services and it empowers
the decision-making process through the wealth of information that it provides.

For more information, please visit www.jeg.org.sa

26
 WWW.JEG.ORG.SA

JEDDAH CHAMBER

Address: P.O. Box 1264

Jeddah 21431
Kingdom of Saudi Arabia

www.jcci.org.sa