The initiation of proceedings for Saudi Arabia’s first independent water project (IWP) is just what regional and international developers have been waiting for.

The last time Riyadh tendered a major desalination project through a public-private partnership (PPP) model was for a cogeneration independent water and power project (IWPP) in 2007. This will the the first standalone IWP opened to bidders in Saudi Arabia.

After a flurry of major IWPP awards between 2005 and 2007, Saudi Arabia’s desalination provider Saline Water Conversion Corporation (SWCC) began to favour standard EPC contracts as the oil price rose to over $100 a barrel. However, with the price of the kingdom’s most lucrative export falling sharply and the government pushing ahead with significant economic reforms, the switch back to the private developer model is the sensible, and some would say the only, move to make.

With a number of power and water projects set to be opened to the private sector, Saudi Arabia will re-emerge as the region’s key utilities market for the world’s largest developers and banks.

The other interesting aspect of the first IWP is that it will be powered by solar technology. This fits into the new renewable energy targets set in the Vision 2030?, and will further boost the the appeal of the kingdom’s utilities sector to international companies. While pilot solar-powered desalination schemes have been developed in Abu Dhabi, Saudi Arabia is aiming to put the technology into utility-scale projects.

With much uncertainty about planned utility projects in the kingdom having emerged in recent months, developers can begin to get excited about the region’s largest utilities market once again.

Andrew Roscoe