Sanaa’s plans to develop Yemen’s first three independent power projects (IPPs) are still on hold having failed to see any progress in over a year.

The Electricity & Energy Ministry launched the IPP scheme in 2009 and attracted interest from 40 companies. The process of prequalification for the deals was expected to follow by the end of 2009.

This has not happened. According to sources close to the scheme, the lack of progress is the result of ongoing discussions over the level of financial support that the government is prepared to give the scheme.

Sanaa was to select developers to build a 150MW plant at Aden in the south, another 150MW plant at Hodeidah in the west, and a third plant with capacity of 75MW at Al-Mukalla, east of Aden, on a build-own-operate-transfer basis.

The plants would use heavy fuel oil as feedstock and sell power to the state-owned Public Electricity Company.

The US’ K&M Engineering & Consulting, the UK’s Norton Rose with the local Al-Suwaidi & Luqman, and London-headquartered PricewaterhouseCoopers are the respective technical, legal and accounting advisers on the project.

But with little sign of progress, the pilot plants are increasingly unlikely to be built.