Present State, Challenges, and Future of Power Generation in Saudi Arabia

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IEEE Energy2030 Atlanta, GA USA 17-18 November, 2008

Present State, Challenges, and Future of Power Generation in Saudi Arabia Ramzy R. Obaid and Anwar H. Mufti
Electrical and Computer Engineering Department King Abdul Aziz University Jeddah, Saudi Arabia Tel: 966-2-640-2000 ext. 68129 Fax: 966-2-695-6826 Email: rrobaid@kau.edu.sa

Abstract – Electricity consumption rates in Saudi Arabia have been steadily on the rise over the past three decades. While the population of about 26 million is growing at a high rate of 3%, the growth in total number of power utility customers is increasing at a higher rate of 5%. Between 2006 and 2007, the Saudi Electric Company, SEC reported an 11.9% growth in total peak loads, which reached 34,953 MW in 2007. Studies show that power demand in Saudi Arabia is expected to continue its rapid increase to reach 60,000 MW over the coming 15 years. In addition to the high rate of population growth, the expanding in industrialization and development plans is among the factors contributing to the rapid increase in power demand in Saudi Arabia. Therefore, major steps need be taken to prepare for the expected future increase in power demand. This paper addresses the actions already taken to increase power generation and availability in Saudi Arabia, and presents recommendations for other actions needed, including the importance of shifting towards renewable energy.

reasons, power demand in Saudi Arabia is expected to grow higher to reach about double its current size over the coming 15 years [3], and major steps should be taken to meet this huge demand. This paper analyzes the history and current state of power generation in Saudi Arabia, along with the rapidly increasing power demand and its causes. It addresses the actions already taken to prepare for the expected future increase in power demand, such as expanding and upgrading existing power plants, constructing new plants, and encouraging private investments in power generation. This paper also presents recommendations for other actions needed, including the shift towards renewable energy. II. HISTORY OF ELECTRICITY SERVICES IN SAUDI ARABIA Prior to the mid 1970s, electricity services in Saudi Arabia were confined to major cities and towns only, and were run by private businesses, municipalities and cooperative societies. Each electricity company charged different tariffs according to the local conditions and attainment of satisfactory revenue. Over the period from 1976 to 1981, almost all of the numerous independent electricity companies in the Kingdom were consolidated into four major regional companies, the so-called Saudi Consolidated Electrical Companies or SCECOs (Eastern, Western, Central, and Southern). Isolated pockets of remote areas in the Country continued to be served by small companies. In November 1998, the government decreed the merger of the four regional SCECOs as well as the ten companies and projects of the General Electricity Corporation into a single joint stock, independent, and self-supported company, known as the Saudi Electricity Company, or SEC. Formed in 2002, and capitalized at over $11Billion, SEC is 74.3% government owned. The Decision also included a defined tariff and stipulated that an independent electricity regulatory authority be established to review the cost of electricity and the electricity tariff. In 2001, the Saudi Electricity Regulatory Authority SERA was formed; and in July 2004, additional responsibility of regulating the Co-generation products of electricity, desalinated water, and steam, were assigned to the

I. INTRODUCTION Since the adoption of the first five-year development plan for the Kingdom in the early 1970s, power demand in Saudi Arabia has been rapidly increasing. The peak load today is more than 120 times higher than what it was 35 years ago, and the number of power utility customers is 15 times higher [1, 2]. The rapidly burgeoning population, high economic growth, and low...
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