GCC states to sign power swap deal |
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Officials from Gulf oil producers will meet in Saudi Arabia this week to sign an agreement on the exchange of power supplies in the event of shortage or disruption within a planned power grid.
The Dammam-based GCC Interconnection Authority (GCCIA)GCC Interconnection Authority (GCCIA)
, which is carrying out the landmark electricity grid, will sign the deal with the six members of the Gulf Co-operation CouncilGulf Co-operation Council (GCCGCC
) in Khobar on Tuesday. "This agreement is for the exchange of commercial power supplies among GCCGCC countries as part of their project to connect their electricity networks in a single grid," said Yousuf Ganahi, GCCIAGCCIA's Chairman."The agreement will include the terms and conditions of such an exchange. It is the second agreement to be signed by GCCGCC
members as the first one included general terms and technical relations within the power grid," he said.Quoted by Saudi newspapers yesterday, Ganahi said Tuesday's deal will allow GCCGCC
states to supply each other with electricity from their own grids.GCCGCC
states are expected to launch the power grid late this year or in early 2010 after the first two phases are completed. Officials said earlier this year the third and final stage is nearing completion, which involves connecting all individual grids. The UAE and neighbouring Oman completed their common electricity network last year, while another project involving four other members of the organisation was finished this year, according to the GCCIAGCCIA
.Officials put the cost of the project at more than $1 billion (Dh3.67bn) but said it will pay off in economic and conservation terms.
"For example, a GCCGCC
state that suffers from a shortage or sudden disruption of its electricity supplies could get such supplies from another member. Another thing is that one member with surplus supplies could lease part of its network to another with a deficit or sudden shortage," the GCCIAGCCIA said in a recent statement."The project will also save funds because it means member countries will construct fewer power stations in the future."
GCCIAGCCIA
said the project was needed due to a rapid growth in power consumption in the GCCGCC as a result of steady economic expansion and high population growth. It estimates electricity growth at between eight and 10 per cent annually - one of the highest rates in the world.The project was launched nearly seven years after it was approved by GCCGCC
heads of state in the mid- 90s. GCCIAGCCIA is overseeing the project, which officials expect to result in a 50 per cent reduction in operational reserve and slash costs of power projects in the region in the long term.The process
The first phase includes the interconnection of Kuwait, Saudi Arabia , Bahrain and Qatar, which is known as the GCC North Grid.
The second phase includes the introduction of independent systems in the UAE and Oman, named the South Grid, which the GCCIAGCCIA
is not involved in. The third phase includes the interconnection of the South and North Grid, which completes the interconnection of all six GCCGCC
countries.Supplies will be shared proportionately by the six members. For the UAE it is 900 MW, for Saudi Arabia 1,200 MW, for Oman 400MW, for Qatar 750 MW and for Kuwait 1,200MW, according to the GCCIAGCCIA
.The UAE owns 15.4 of the project while 31.6 per cent is controlled by Saudi Arabia, 26.7 per cent by Kuwait, 11.7 per cent by Qatar, nine per cent by Bahrain and 5.6 per cent by Oman.
In a recent statement, the GCCGCC
secretariat said the grid will slash power costs by reducing the level of reserves needed by each member.By Nadim Kawach
© Emirates Business 24/7 2009
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