Forming the foundation pillars upon which the economic development of the country is based, The Power and Water desalination Industry in the GCC nations is characterized by a limited source of supply struggling to cater to the escalating demand fuelled by increasing population and improved standards of living. Spurred by a buoyant economy and population growth, over US$ 300 billion will be invested in the GCC water and desalination projects, between 2012 – 2022 periods. Subsequent to its revolutionary discovery of hydrocarbons about three decades back, the GCC economies have come a long way into establishing themselves as a fast developing region boasting modern amenities and facilitating high standards of living. In an ardent quest to remove the tarnished image of an impoverished desert with limited prospects for economic development, the governments across the GCC have increased spending on job creation and infrastructure expansion and are opening up utilities to greater private sector involvement.
Whilst Privatization occupies centre stage in the overhauling process of the Power and Water sector, the initiatives towards alternative energy sources in the form of Solar and Nuclear power, as alternatives to the heavy dependence on the hydrocarbons sector, particularly to replace natural gas as a primary fuel in power generation, has been considered a highlight of the regional power reforms. The emergence of alternative power sources will enable GCC nations to successfully diversify their economic growth from a predominantly oil based economy thus bracing themselves against future adversities arising from oil fluctuations.
Renewable energies are about to capture a considerable segment of the global energy mix. This segment is only likely to grow given rising demand for energy, supply worries with regard to fossil fuels and environmental concerns. In particular solar energy offer huge potential for the GCC countries. Rising domestic energy needs for power generation and desalination, favourable conditions for solar energy production and interest in acquiring technological know-how make a perfect argument for renewable energy in the Gulf. In spite of their heavy dependence on hydrocarbon fuels, the GCC countries have access to one of the world’s most abundant solar resources. All six nations of the GCC have either embarked upon or committed to investments in solar projects, with projects split between solar photovoltaic and solar thermal applications.
The GCC region also has considerable wind resources, even though these vary widely across the countries and wind installations are at a less developed stage than their solar counterparts. Other potential sources of alternative energy include bio fuels, geothermal, and nuclear power. Through initiatives like the UAE’s biodiesel plant in Al Ain Industrial City and the Qatar Advanced Bio fuel Platform (QABP), the GCC countries are looking to the prospective of biomass-derived alternatives to fossil transportation fuels. While the region boasts substantial geothermal potential, this resource has been comparatively unexploited; the drilling of two geothermal wells in the United Arab Emirates’ (UAE) Masdar city represents the principal progress in this field. Following approval of the civilian nuclear cooperation between the United States and the UAE, and the latter’s award of contracts for the construction of four nuclear reactors to a South Korean consortium, the UAE looks likely become the first country in the Middle East with a civilian nuclear energy program of significant scale. However, several other countries in the region have expressed serious interest in nuclear power to meet growing electricity demand and to initiate their transition to low-carbon development
Renewable energies can extend the lifeline of the GCC’s oil and gas exports, and in some decades from now, they even have the potential to expand into a major pillar of the economy. Energy created from renewable could gradually substitute oil as the GCC’s major export item. An essential precondition for this would be a wholehearted grip of the renewable energy trend by the GCC countries and their development into technological leaders in the field. They should consider renewable not as unwanted competition to their oil and gas production, but rather as a welcome addition to tight global energy markets.
The fervent efforts of the GCC Governments in enforcing legislations to conserve water in addition to their avid focus on desalination and waste water treatment, highlights the significance given by these economies to meet the demand for water. Faced with the inherent disadvantage of extreme scarcity of ground water, the GCC nations are doing everything within their power to conserve and improve the supply of water through desalination and waste water treatments. As part of its overhauling measures, the regional governments are also educating the masses on conserving this valuable resource in addition to plans on introducing marginal pricing relative to the increasing usage to deter increase in demand as well as to manage the costs of production.
On the basis of years of tracking both power and water sector development, and maintenance projects, the team at Ventures Middle East aims to explore the dynamics surrounding the GCC power and water desalination industry in this study. The study in particular provides a regional perspective on the size and value of Power and Water sector covering the vital statistics on the installed capacity, production and demand for power and water besides providing an analysis of the contractor awards and construction spends in the power and water sector. The study also provides a strategic assessment of the Industry landscape by providing an analysis of the Political, Economic, Social, Technological, Legislative and the Environmental trends impacting this high growth Industry.
This study provides a comprehensive understanding of the complete market dynamics of the Power and Water sector to assist players interested in assessing the market opportunities in this robust and dynamic market.
