Developers line up for Dubai private power project

11 May 2011

Around 16 companies respond and bids are scheduled to be invited by mid-May

Developers have responded to Dubai Electricity & Water Authority’s (Dewa) request for qualification (RFQ) to build the emirate’s first independent power project (IPP).

According to a source at Dewa, about 16 developers submitted RFQs out of the 28 companies that submitted expressions of interest earlier this year.

Dewa’s advisers, a UK consortium comprising bank HSBC, engineering firm Mott MacDonald and law firm Clifford Chance, are evaluating submissions and a list of prequalified companies is expected within the next week.

Dewa’s bid schedule states that bids are to be invited on 16 May. Dewa has said that it is still on-schedule.

The IPP at Hassyan was previously to be developed as an independent water and power project (IWPP), but the desalination element was subsequently dropped. According to a source at Dewa, the decision to adjust the project plan was taken following a revised water demand forecast. While power continues to increase at a steady rate, meeting water needs in coming years will be less difficult.

The Hassyan 1 project will be constructed on a build-own-operate (BOO) basis. When complete, it will generate 1,400-1,600MW and is to use natural gas/distillate fuel. The project is expected to be commissioned in 2014. Dewa will buy all of the power produced by the project.

The chosen developer will take a 51 per cent stake in the Hassyan 1 IPP. It will be responsible for the development, financing, design engineering, procurement, manufacture, construction, permitting, commissioning, operation and maintenance of the power plant and associated facilities, as well as fuel.

The Hassyan 1 IPP is expected to be followed by five or six similar independent projects as part of Dewa’s private power programme. The project was originally planned to be built on an engineering, procurement and construction (EPC) basis.

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