Kuwait has long struggled to meet rising domestic demand for electricity
A lack of power-producing capacity has frequently led to black- and brown-outs during the summer months, when demand peaks in Kuwait.
The Ministry of Electricity and Water (MEW) is responsible for the construction of new power plants in the emirate and plans to spend about $10bn on power schemes by 2015. In 2009, the ministry awarded a $2.7bn contract to a consortium of the US’ GE and South Korea’s Hyundai Heavy Industries for the construction and management of a 2,000MW plant for seven years after commencing operations. The plant was commissioned in early 2011 and should hit full capacity by the end of the year.
Building on this success, the ministry had planned to award a series of new power schemes using the independent water and power project (IWPP) model, working alongside the Partnerships Technical Bureau (PTB). However, after preferred bidders for the new 1,500MW Al-Zour North power plant were selected in February 2012, the Kuwaiti parliament voted to cancel the project, which had been planned since 2009. Other schemes have been shelved while the ministry deals with the political issues with passing the Al-Zour North deal. Contractors hoping to bid on such deals have found the process frustrating and expensive, as they have not been compensated for the cost of taking part in multiple bid rounds. However, given the promise of about $7.3bn of new schemes under development, they are likely to hold out for a positive outcome.
Kuwait has also decreed that future power projects with a capacity of more than 500MW will be developed by the PTB, rather than the ministry, under the IWPP model. In March, the PTB issued a request for proposal to consultants to advise on the development of an IWPP at Khiran. The thermal power plant was initially under the remit of the MEW, but was transferred to the PTB when the scope was expanded. Located to the south of the existing Al-Zour South power and water project, the plant will have a capacity of 2,500MW of power and 125 million gallons a day of water.
Mohamed Boshehri, director of planning at the Ministry of Electricity and Water
Tel: (+965) 2 537 1000
You might also like...
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.