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Investment
in Arriyadh
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Water and Energy for Arriyadh
Two challenges facing Saudi Arabia are water and electricity.
Power cuts are few and very far between and there is no
shortage of water. However, even as the supply of both
water and electricity expands, demand is expanding faster.
The government accepts that the current demand growth
is unsustainable. The state oil company Saudi Aramco, has
warned that on current trends, within the next five years the
country could be using fully a quarter of its 12 million barrels
a day oil production to fuel its own power stations and motor
vehicles. Pushing out the demand trend to 2028, fully eight
million barrels a day will be required just to keep the lights
on, the air-conditioning working and vehicles moving on the
highways.
Another telling way of expressing the challenge is that with
its 30 million people, the Kingdom is the 44th largest country
in population terms. However it is the world’s 13th largest
consumer of energy.
The economic boom has undoubtedly spurred demand but
far too much energy is wasted and water too. Given that
the majority of the Kingdom’s water is provided by energy-
intensive desalination, the squandering of water also boosts
the needless consumption of power. It is an astonishing
statistic that at periods of peak demand in Gulf Cooperation
Council countries, including Saudi Arabia, fully 70 percent
of the available power is consumed by air-conditioning, at an
estimated annual cost of around $20 billion.
Arriyadh receives 50 percent of its drinking water by pipe
from desalination plants on the East Coast at Jubail. The
rest is drawn from local artesian wells. Within the city, the
piped water distribution network reaches 96 percent of the
population, with the remaining gaps being filled by bowser
deliveries.
A significant part of the challenge is that people living and
working in Saudi are used to paying so little for their water
and electricity. The price hardly covers the cost of billing and
collecting payments, let alone the expense of producing and
distributing both commodities. Put another way, while the
international market price of oil continues to hold around the
$70-mark, consumers of water, power and fuel are paying the
equivalent of $5 a barrel.
The New Focus on Renewables
The Kingdom is now working hard on alternatives to the
ubiquitous air-conditioning and to power generation. Arriyadh
is pioneering much of this research and the new King Abdullah
Petroleum Studies and Research Center will pioneer developments
in this field. The King Abdullah Financial District is set to become
one of the most environmentally advanced districts in the world,
using solar power and water recycling and energy conservation to
sharply cut down its impact on precious resources.
There are also plans for ‘District Cooling’ in dense urban
areas. Commercial and residential properties will share a central
cooling facility that pumps chilled water through a network of
underground pipes.
One study has estimated that, despite the high initial capital
cost, by 2030 such systems could be supplying 30 percent of the
anticipated cooling needs for the GCC, with a power saving of
20,000 MW, the output of ten large power stations consuming
the equivalent of 200,000 barrels of oil every day. Of equal
importance, the low-energy ‘District Cooling’ systems, in which
the water is recycled, would mean that the region’s power-
generation emissions of carbon dioxide would be cut by some 31
million tons a year.
Since 2010, Arriyadh has been home to the King Abdullah City
for Nuclear and Renewable Energy. This center of excellence is
leading the drive to bring both solar and nuclear power to the
Kingdom. For renewable energy alone it has an annual budget
some SR 500 million ($133 million). Studies on both the siting and
the technology to be used for nuclear power began in 2012, with
security being a crucial consideration. However, work on the first
nuclear power station could still be at least a decade away.
On the other hand, large solar arrays are likely to become a
reality far sooner. New large-scale test installations are now under
development in the Saudi capital and herald the likely development
of some of the world’s largest solar generating installations. The
time, it seems, is not far off when the often ferocious power of
the Saudi sun will be harnessed to provide power to industry and
households.
Locally generated solar power is also likely soon to power the
driverless carriages operating on the six new lines of the King
Abdulaziz Project for Public Transport in Arriyadh which will
whisk people quietly, conveniently and in comfort and safety
around the huge urban area of the capital.