"The situation of electricity in Yemen is complicated and citizens are not aware of how the electricity reaches their house," says Minister of Electricity and Energy- Awadh Al-Suqatari.
In a friendly meeting with many concerned journalists, considered a transparent move by a minister for the first time in the history of electricity, minister Al-Suqatari revealed the real situation of electricity in Yemen and the problems facing this vital sector in the country.
The country depends on old power stations which are in a poor condition
Yemen depends on old power stations, established in the early 1990s, which today are in a poor state and are virtually without any upgrading ever since their establishment. The whole energy output the country depends on, is only 1150 megawatts. 650 megawatts are generated by the old power stations forming the National Electric Network (NEN) in 11 governorates, 300 megawatts are generated by individual power stations in isolated areas like Hadramout and Al-Mahra, and 200 megawatts are called bought from Agrreko Company, which started providing its services in the country in 2006, to boost NEN power in six governorates.
"No single electric station has been constructed since 1990s to cope-up with the increasing demand."
No law to organize work of electric sector
Since its establishment until the present, there is no law in place to organize the work of the Ministry of Electricity and Energy and control the wide spread corruption in electric sector "Absence of a law is one of the main issues hindering the work of the Ministry to reform the electric sector."
Recently however, such a law has been issued. The law gives the ministry wider powers and clearly defines its responsibilities. Based on the new law, the private sector will join electricity sector in order to help the government to overcome the electricity shortage in the country.
Under the new law, three corporations will be created to organize the work in electric sector, namely": the generating corporation, the distributing corporation and the transferring corporation.
Growing demand, little work
However, the efforts will contribute to only 3% out of the 9% growing demand for electricity. Last summer the shortage reached 300 megawatts, the greatest shortage experienced in the history of the country. The expected shortage for 2010 summer is between 550 to 600 megawatts. With the Mareb Power Station working on gas or Mareb 1 buying 130 megawatt of power from the private sector and entering to provide the service, the shortage will be reduced to 184 megawatts. The output of Mareb 1 is 341 megawatts; 80 megawatt will be used to replace a part of the bought energy from Agrreko (200 megawatts).
The Private sector will carry out two projects in Aden and Hudeidah to help fill the gap of demand. Two stations will be constructed with an output of 60 megawatts each, in the two governorates.
Constructing electric stations is not an easy task. To construct a station working on gas, similar to Mareb 1, needs no less than 24 months in the best conditions (i.e.if there are no tribal and other social or geographical obstacles). An additional six month time period is again needed for trial operations and yet another to check the national network.
Problems over Agrreko
Agrekko Company entered to provide services in Yemen in May 2006 with small generators to light Hodaida city for the 15th Yemen Reunification anniversary celebrations held in Al-Hodaida, in an effort by the Ministry of Electricity and Energy to supply the city with enough light for the occasion since supplying enough light was a direct order from the countrys' leadership.
In the absence of a enough time for the ministry to study the project (of supplying the city with enough power), the ministry invited quick tenders for the purpose and Agrreko won the bid as it gave the suitable offer. The company bought generators from England and supplied the city with electricity for the purpose.
In response to increasing power shortage in major cities, the company expanded its services to include other five six cities, including Sana'a and Aden, supplying them with the power. It bought many additional generators, each with one or two megawatt outputs, which were linked to the National Electric Network.
With the expansion of services by Agrreko, the demand for diesel (fuel for these generators) increased and so did the debts of the ministry (the company sells the energy to the ministry for higher prices and the contract signed between the ministry and Agrreko says that the ministry has to pay a fine in case of delays in supplying diesel to Agrreko.)
The ministry and the General Electric Corporation found themselves unable to pay the claims of the company, which led to differences between the two and in some instances to Agrreko closing down its generators temporarily.
"We could not keep our commitments to Agrreko." The ministry is now planning to dispense off a part of the services provided by Agrreko service, mostly 80 megawatts, once Mareb 1 enters to provide services.
Challenges facing constructing and operating Mareb 1
Mareb Electric Station, which operates on gas, or Mareb 1, has being facing challenges since the onset of the project in 2005. The station has experienced many problems including technical problems and problems with tribes and land owners in the Mareb governorate.
The construction of the station had to be completed by the end of 2007 and the station ready to enter the service in early 2008. However, there was a delay by the Iranian Persian Company, which was constructing transferring stations needed for distributing the electricity coming from Mareb 1, unwillingly. The blockade imposed on Iran forced the company to import its equipments from Europe, though Iran able to provide the company with them.
While problems caused by tribes have been solved , the great technical problem faced by the operating the station still remains. The problem is that the gas supplied by Safer Company contains impurities and great quantities of diesel, a mistake on the parts of Safer Companies for Oil and Gas, which provides the station with gas as fuel and the German Siemens Company, which has constructed the station.
Differences erupted between the two companies over the problem. Siemens claims that the gas it received from Safer, as a fuel sample for the station, before construction, was different from the one which is given now and that the first was clean and the second is full of impurities and quantities of diesel.
But Safer says that the gas sample handed to Siemens before, was of the same type as the one which is going to be used as the fuel. The ministry interrogated Safer, went into clashes with it over the problem and in the end returned to Siemens asking for help.
Considering the high cost quoted by German Siemens Company to repaire the mistake , a special committee has been set up to study the problem and provide solutions. The Committee is chaired by the Prime Minister and comprises of other concerned bodies as members.
The committee suggested three "sources" (solutions) to operate Mareb 1, the first source, tested during the past three months, has failed. Now the committee is using the second source. This "source" consists of extending a pipeline from the Yemeni Company for Liquefied and Natural Gas or Yemen LNG to Mareb1.
Tests are going on for operating the station by the gas coming from Yemen LNG, which has got a certificate of approval saying that it is clean and dry and suitable to the station. This, 8-inch diameter pipeline from Yemen LNG was extended to the station as the second source of solving operation problem, following several unsuccessful attempts made by safer to clean the gas.
"Impurities in gas have not caused great effects on the equipments of the station because the problem has been discovered early and this is an advantage of the trial operation." The third "source" or solution is still not revealed, but is still 'in hand' if need arises.
Based on these solutions, the second trial operation of the station will start in January and with this the 341- megawatts station will enter the service in April.
Corruption in electric sector
Corruption exists in every public intuition, and the Ministry of Electricity is no exception. Besides administrative corruption, corruption in electric sector goes deeper and has entered in tenders, in collecting the cost of electricity and other things.
"Specialized bodies, like the Central Organization for Control and Audit and The Supreme National Authority for Combating Corruption, have to do their duties in dealing with corruption related to tenders." Another form of corruption, is that sheikhs and other influential people evade from paying the price of electricity and some employees are colluding with them.
The ministry and the General Electric Corporation have started interrogating corrupt managers in an attempt to reduce corruption.
Promising vision
The ministry has plans to utilize renewable energy. Given that Yemen is rich in natural forms of energy such as wind, sun, heat or steam and nuclear energy, the future will witness carrying out a number of projects using these resources.
Nearly 1000 solar panels, which produce electricity from the sun, will be distributed to rural areas characterized by remote and scattered houses on hilltops.
The Government, World Bank and Islamic Bank for Development will finance this project, which will costs USD 9 million. This kind of energy is costly but it is also safe.
Producing energy from winds is the cheapest and the most relevant. The ministry has prepared a study on constructing a power station working on wind energy with output of 60 megawatts in Bab al-Mandab and Mocha area. This project will be funded by Donors, World Bank and Islamic Bank for Development.
Furthermore, there are plans to construct another station working on wind. This project will be carried out by the private sector and will be announced once the ministry reaches an agreement with the investors.
Steam energy is also being studied; there is coordination with concerned parities to dig a well in Jabal Allessi in Dhamar to measure the available quantity of the steam and identify ways to harness this source of energy.
Shortsighted vision
Though the government approved 15 years strategy for electribity predicts that the real demand for electricity by 2025 will be only 5,000 megawatt, this is an unrealistic figure. If the demand for electricity is estimated at 1600 megawatts in 2009 and demand increases by 9-10 megawatts annually, it shows that the strategy is shortsighted.
"This power will not be enough to cover the consumption; the country has to work hard during the forthcoming years to solve this problem."
Future projects
The government announcement to support electricity with YR 113 billion from its budget, reflects political will to improve this vital sector which affects the daily life of the people.
The Ministry of Electricity and Energy has many projects planned to start this year. It plans to use all the funds collected from the government and the donor community to establish new projects in field of electricity to fill the gap in the demand. The projects of constructing two power stations operating on gas in Mareb - Mareb 2 and Mareb 3 that will generate 900 megawatts are also scheduled for this year.
The ministry also has a plan to set up stations operating on mazot because mazot is cheaper than diesel. The real price of the one litter of diesel is YR 100-200 but it is subsidized by the government both for electricity and other private projects.
Besides these public projects, tenders have been approved for private energy projects to supply the national network with 450 megawatts energy and lessen the energy shortage. These projects will start next year.
Rural areas will witness more electric projects as well.
Role of the private sector
One of the merits of the new law for the ministry is that it includes the private sector to help the government to overcome the power problem. No country can do without the private sector to overcome the electricity problems, as electricity is a basic need.
The law visualizes the private sector to play a role either as investors or in managing electrical projects. "Including private sector in electricity is a positive move to help the ministry overcome challenges it faces."
Even rich countries, like Saudi Arabia need the help of private sector. The kingdom recently announced a strategic power project with output of 3000 megawatts to be carried out by the private sector.
Besides electric projects which will be carried out by the government, the Ministry of Electricity has a plan with the private sector according to which the private sector will to construct power stations and the ministry will buy the electricity from it to sell to the citizens.
The agreement is that the private sector will provide the country with 200 megawatts as an interim solution, and in the future, this sector will raise the level of energy it sells to the ministry to 400 megawatts.
The energy provided by the private sector is called bought energy. This kind of energy is considered an interim solution to bridge the wide gap of power shortage. Tenders have been recently opened for this and the Egyptian Al-Ahram Company won the bid to supply 50 megawatts of energy for Al-Hodaida, Al-Saqr company won a bid to supply Aden with 20 megawatts of energy, in addition to another company which will supply Hadramout with 40 megawatts.
Updating electric service
In its efforts to improve this vital sector and to do away with faults and power stealing, the ministry has installed 130 prepaid meters in the past and this service will be improved in the future. But this system is still not used extensively in many countries, indicating that it is not appropriate to apply this system to the 1.5 million consumers.
The ministry is carrying out a study on ways to reduce electricity losses. It has a plan to reduce electric losses from 26 to 20 percent before 2013.
In rural areas ,which face problems of power cut because of the differences over the payment of electricity, a new system will be applied. The ministry is planning to install central meters to overcome this issue and will use the private sector to organize the projects in rural areas.
Social beliefs: part of electricity problems
People in Yemen, especially in tribal areas, use electricity illegally. While some do not pay the price of electricity, others get access to it randomly from the nearby towers.
These problems are a result of ignorance of citizens and the connivance of some employees in the ministry or in the electricity department. "Citizens believe that they have the right to get electricity free of charge."
Random access to electricity causes many dangers and affects the national economy. Fire incidents, damaging home and loss of electricity are few of the problems resulting from illegal access to electricity.
Important Statistics
USD 1.1 billion, the government support to electricity sector in 2008.
YR 90 billions, expected revenues of electricity for 2009.
YR 67 billion, electricity revenues for 2008.
YR 22 billions, due debts for General Electric Corporation.
USD 80 millions, annual revenues of the bought energy.
USD 25 million, debt of GEC to Agrekko.
USD 18 million, costs of technical faults of Mareb 1
More than USD 3 million as daily cost of diesel.
YR 700 million, cost to improve electricity in Aden, Abyan and Lahj for hosting Gulf 20 championship.
By Mahmoud Assamiee
© Yemen Times 2010
