Gulf grid project to be up and running by 2010

Six Gulf Cooperation Council (GCC) states are set to be connected to a regional transmission grid by 2010, according to a recent report by the GCC Interconnection Authority.

The first phase of the project, due for completion by 2008, will see Qatar, Bahrain, Saudi Arabia and Kuwait connected. The second phase, due for completion in 2008, will connect the UAE and Oman – the two sections will be linked in 2010.

The project is estimated to cost $1.1bn, with a total of $994.7m to be invested from 2006-2008. Tendering for the first section has already been completed.

The project is expected to foster additional generation in the region, with International Energy Agency forecasts predicting the need for an additional 269 GW of capacity in the region, requiring an investment of some $458bn. The bulk of this development is expected to be focussed on Saudi Arabia and the UAE.

Private players prepare to enter South African power market

South Africa has issued a request for proposals (RFP) for two simple cycle gas turbine generation stations, a move which will introduce the private sector to the country’s power sector for the first time.

Establishing the framework for Independent Power Producer (IPP) projects in the region will allow the government to meet growing power demand through a combination of private and public endeavour, with the private sector expected to deliver some 30 per cent of new capacity.

According to estimates from the Department of Minerals and Energy (DME), R107bn ($14.7bn) will be needed between 2005 and 2009 to meet South Africa’s growing energy needs. State-owned Eskom will invest R84bn over the next five years with the balance of R23bn reserved for IPPs.

PB Power has advised the DME since the start of the programme in 2004 on establishing a competitive tendering process.

Ethiopia moves forward on 1870 MW hydro development

State-owned national utility the Ethiopian Electric Power Corporation (EEPCO) has signed an agreement with Italy’s Salini Costruttori for the development of the 1870 MW Gilgel Gibe III hydro project.

The ETB15bn ($1.72bn) project is to be developed in the northwest of the country in the Omo-Gibe river basin and will be the largest such plant in Ethiopia. The plant is expected to be operational by 2011 and an associated 550 km-long, 400 kV transmission project is expected to push the total figure for development costs to some $2bn.

EEPCO is currently developing a number of hydro projects including the 420 MW Gilgel Gibe II. The 184 MW Gilgel Gibe I project is already operational. Collectively, the projects will enable Ethiopia to generate some 40 per cent of its electricity demand.

SE deflects blame for high energy prices on to Slovakian distributors

Amidst moves by the newly elected government to renationalise strategic assets in the energy sector, Slovenske Elektrarne (SE) Slovakia’s largest generator, has reportedly rejected suggestions from the government that it should reduce electricity tariffs, instead pointing to the profits of foreign-owned distribution companies.

SE, itself 66 per cent owned by Italian utility Enel, has apparently been the focus of a buy back move by the government, though Enel has reportedly rejected the offer having pledged to invest heavily in the utility.

The discord erupts as neighbouring Slovenia moves to create a competitive energy market with the privatization of state-owned HSE, the setting up of a second generation company Gen Energija, and the hiving off of a number of hydro plants. Several companies are reported to be evaluating the assets.

Riga capacity boost from GE

GE Energy is supplying a Frame 9FB gas fired turbine-generator for the expansion of Riga Thermal Power Plant II, the largest thermal plant in Latvia.

The expansion will increase the plant’s output by approximately 420 MWe and some 270 MWth.

The equipment will be shipped in December 2006, with commercial operation planned for June 2008.

The lead contractor for the expansion is Iberdrola Ingenieria y Construcción.

UES unveils investment plans

Russia’s UES has released details of a five-year Rb2.1tn ($78.6bn) investment plan.

The programme is expected to deliver some 20.9 GW of new generation capacity, with some Rb1.1tn of investment on the country’s transmission grid.

Thermal generation will account for around Rb650bn of the total investment fund with the majority of the remaining figure going on hydroelectric developments.

News digest

Algeria: SNC-Lavalin is to build a 1227 MW gas fired power station in Algeria’s Tipaza Province. The project is due to begin operations in 2008. SNC has also signed a separate 20-year maintenance contract in a pair of deals worth $1.2bn.

Bahrain: With the operation of the country’s first IPP, Bahrain now produces excess electricity. The 470 MW first phase of Al Ezzel development is complete with the second due by next May.

Bulgaria: Enel has set its sights on acquiring energy assets in Bulgaria, Romania and Russia amid concerns that its ambitions to acquire sufficient bulk to compete with the other European power majors remain unfulfilled.

Bulgaria: The Bulgarian Competition Commission has approved the acquisition of the 1260 MW coal fired power station at Varna by CEZ.

Iran: A 7 km, 230 kV transmission line between Iran and Azerbaijan has begun operations. The line, which can deliver a maximum of 50 MW, will supply Iran in summer and Azerbaijan in winter.

Lithuania: Poland has been invited to participate in the construction of a third reactor at Lithuania’s Ignalina nuclear station. Lithuania, Estonia and Latvia have already come to a provisional agreement to develop the unit.

Romania: Hidroelectrica plans to privatize 51 small hydro plants this year as part of accession negotiations with the European Union.

Russia: Wärtsilä is to develop a 17 MW CHP plant at the city of Eisk in Southern Russia. The plant will consist of two gas engine gensets in a contract worth over €10m ($12.7m).

South Africa: ABB has won a $30m contract for 275 kV and 400 kV circuit breakers and medium voltage 400 kV surge arrestors for South African utility Eskom.

South Africa: Honeywell has won a $41.4m, three-year contract from South African utility Eskom to provide a distributed control system for six generation units at the Grootvlei power station.

Tanzania: Wärtsilä is to construct a 100 MW gas fired power plant in Tanzania in a contract worth €57m ($72.4m). The 12 engine plant, will be located at Ubungo in Dar es Salaam.

Uganda: Four companies, including a local group, have submitted bids to build, own and operate a 50 MW thermal plant to be located in Mutundwe, Kampala.

Zambia: National utility Zesco has contracted Kalpatura Power Transmission of India to develop a 330 kV transmission line 72 km from Kansanshi to Lumwana. The project is expected to cost €8.5m ($10.8m).