“The biggest challenge is meeting demand,” said Amer Alswaha, chairman of the IPP unit of Saudi Electricity Co, who added that the kingdom’s electricity demand was doubling every 10 years.
Bander Allaf of ACWA Power explained that Saudi’s electricity consumption was 2.7 times the world average – “the equivalent of burning two million barrels of oil per day”.
They were speaking at a panel discussion at POWER-GEN Middle East in Qatar’s capital Doha. Also on the panel was Ian French, vice-president of business development in the Lower Gulf region for Siemens, who said that “life is tough for contractors in the GCC”, not least because of the number of firms competing for business.
He said as well as EPC giants such as Siemens (NYSE: SI) and Alstom, there were also contractors from the US, Turkey, Spain and Greece trying to break into the market.
“More and more people are chasing less and less business,” he said, adding that it was very much a buyers’ market.
He added the picture was equally bleak for developers: “The good days have gone.” He said the one country in the Middle East apart from Saudi offering strong opportunities was Iraq, but that was a country for “the brave developer”.
However he hoped the sector had “reached the bottom” and said he believed “we are in a recovery cycle – these markets will come back”.
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