GCC shared electricity grid deal signed



GCC countries signed a deal on the exchange of power supplies in the event of shortage or disruption within a planned power grid with the six members of the GCC.

The deal will allow GCC states to supply each other with electricity from their own grids.

The project is being carried out by the Dammam-based GCC Interconnection Authority (GCCIA).

The countries 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 Oman completed their common electricity network last year, while another project involving four other members of the GCC was finished this year.

Officials put the cost of the project at more than $1 billion (Dh3.67bn).

The project will be carried out in three phases. 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. The third phase includes the interconnection of the South and North Grid, which completes the interconnection of all six GCC states.

6 July 2009



Analysis and forecast (↓ decreasing risk)

The GCC has one of the highest electricity demand growths in the world, estimated at an average of almost 10%. The rapid development in the past decade has outpaced development of electricity resources and there have often been cases of power cuts, particularly in the summer months, as demand for cooling soars. Individual GCC countries have been looking at various options to increase power production, including nuclear power. However, the connection of the GCC grids will undoubtedly fill any immediate gaps, particularly for locations that no immediate increase of power generation plans are available.

Electricity shortages have already been reported this year in Bahrain and Saudi Arabia, and Kuwait’s failed to secure additional power requested from Qatar.

The grid will also play an important future role whereby countries with no plans for significant increase in power generation will be able to tap into projected surplus electricity from other countries.

The figure below shows the expected contribution of the individual GCC state to the connected grid.