meed-logo

line1 line2 line3
SIGN IN / REGISTER

Region plans vital big grid connections

29 May 2023

 

The mantra “there will be no transition without transmission” dominated this year’s World Utility Congress, which was organised by Abu Dhabi National Energy Company (Taqa) and held in the UAE capital on 8-10 May.

“There will be no transition without interconnectivity with our neighbours. If we are not interconnected, we are not using the full capacity of our [electricity] network,” UAE Energy and Infrastructure Minister Suhail bin Mohamed al-Mazrouei said at the congress.

For the GCC states in particular, their ability to procure affordable and large-scale solar energy capacity, and the wide discrepancy in peak demands between the winter and summer months, which often results in substantial idle capacity, make it imperative to connect to other states or regions.

“Links to other GCC states and Central Asia will enable our electricity system to run more efficiently. Some have access to wind, others to solar or hydropower. We also have different peak hours,” Al-Mazrouei said. “We need to consider [these opportunities] and make the investments.”

Boosting transmission

In recent years, there has been a flurry of projects to build or enhance electricity transmission links within the GCC states, as well as with neighbouring countries such as Iraq and Jordan.

Contracts were awarded this year for the construction of overhead transmission lines connecting the GCC grid to Iraq via Kuwait, as well as a link between Iraq and Jordan.

Other projects in the early stages include a second connection between Saudi Arabia and Iraq, Saudi Arabia and the UAE, and the UAE and Oman.

Beyond the GCC, a $1.8bn electricity link between Saudi Arabia and Egypt is under construction. The project will facilitate the exchange of 3,000MW of electricity between the two countries through overhead transmission lines as well as high-voltage, direct current (HVDC) subsea cables.

The most ambitious plans include projects that will pipe electricity from Egypt, Tunisia and Morocco to European countries including Greece, Italy and the UK.

Some have access to wind, others to solar or hydropower. We also have different peak hours … we need to consider [these opportunities] and make the investments
UAE Energy and Infrastructure Minister Suhail bin Mohamed al-Mazrouie 

Shifting peaks

Energy security has spurred investments to interconnect electricity grids between national borders and time zones. The pace of development is reminiscent of the advent of data interconnectivity two decades earlier.

Grid interconnections are also critical for the integration and optimisation of renewable energy, according to Jessica Obeid, a partner at New Energy Consult.

“Grid interconnections enable efficient management and mitigations of stability challenges linked to the integration of variable renewable energy such as wind and solar into the grid,” she says.

These interconnections enable the deployment of renewable energy where land is vast and resources are abundant, to be dispatched in energy load centres.

More importantly, they reduce the curtailment of renewable energy systems through electricity exchange, balancing supply and demand at various periods.

UK startup Xlinks aims to connect Morocco to the UK via four HVDC subsea cables stretching 3,800 kilometres across the Atlantic. “Long distance interconnectors solve the intermittency of renewables as the sun is always shining or wind is always blowing elsewhere,” says Simon Morrish, Xlinks’ CEO. 

“The idea is to generate clean energy and then move it to meet demand, which is much more economic than relying solely on domestic capacity.”

Xlinks aims to generate 10.5GW through solar and wind farms in Guelmin Oued Noun and pipe about 40 per cent of that energy through subsea cables that will have to pass through Spain, Portugal and France. The UK will receive 3.6GW of clean, affordable energy – equivalent to 8 per cent of its electricity needs – by 2030.

Soaring data demand drives boom

Desertec’s long shadow

The scale of Xlinks’ ambition draws comparison with an earlier project, the Desertec Industrial Initiative (Dii), which launched in 2009, but ironically has yet to see the light of day.

Dii had planned to build renewable energy plants globally, including in Morocco, and supply up to 15 per cent of Europe’s power demand by 2050.

Xlinks’ proponents expect to succeed where Desertec failed, however. “Generation costs are more than 90 per cent lower than they were then, which makes the project economically – as well as politically – attractive,” Morrish says.

Xlinks’ point-to-point design with an exclusive energy supply for the UK is expected to eliminate challenges associated with trying to use third-party transmission networks.

Although the technologies are all mature, Morrish says iterations have led to a much lower levelised cost of transmission over these distances. There is also more expertise for the HVDC system beyond the original equipment manufacturers.

Average electricity prices in Europe have increased significantly over the past 10 years and power delivered from the Middle East and North Africa (Mena) region is competitive with other reliable low-carbon solutions, according to Morrish.

The existence of clear renewable targets in Europe could also benefit Xlinks’ project, as well as similar schemes, such as the EuroAfrica Interconnector, which aims to link Egypt to Cyprus and Greece, and the Elmed Mediterranean project that links Tunisia to Italy.

Morocco’s renewable energy leadership, which includes having implemented legislation designed to facilitate the export of renewable energy, is another positive factor.

“Previous projects have typically focused on the recipient jurisdiction, such as Europe, rather than understanding the drivers for the generation country,” says Morrish. “By focusing on the benefits to the Mena region, in this case Morocco, Xlinks has obtained support from both Morocco and the UK.”

The 13-year gap between Desertec and Xlinks has not necessarily changed the mindset of some industry players, who are just beginning to grasp the complexities involved in other decarbonisation technologies such as green hydrogen and carbon capture and storage.

“It is an excellent concept, but it will be exceptionally difficult, if not impossible, to execute given the high demand for HVDC cables, financing and political considerations,” says a Dubai-based contractor.

Unlike the more reasonably- structured interconnections between the GCC or Mena states, the scale and scope of Xlinks’ scheme and other similar projects will require export credit and multilateral development agency support in combination with project finance debt. Experts say this is critical, but not entirely unprecedented.

For instance, Taqa’s decision to contribute $31m in the startup’s early funding round, which also includes $6.2m from UK-headquartered Octopus Energy, appears to signify investor appetite for the project. The scheme is expected to boost foreign direct investment and create thousands of jobs in Morocco during its construction phase.

Electricity demand is increasing at alarming rates, in direct relation to the impact of climate change and the increases in temperatures, cooling and water demand, which reduces the available supply for exports
Jessica Obeid, New Energy Consult

Political undertones

In December 2022, Saudi Investment Minister Khalid al-Falih said the kingdom is keen to join an agreement between four countries to export clean electricity from Azerbaijan to Europe.

He was referring to an accord signed by Azerbaijan, Georgia, Romania and Hungary to build an undersea cable in the Black Sea transmitting energy from Caspian Sea wind farms to Europe.

The agreement involves a 1,100-kilometre, 1GW cable running from Azerbaijan to Romania. It is part of broader EU efforts to diversify energy resources away from Russia amid the Ukraine war.

This provides an alternative to Saudi Arabia’s grid expansion plans, and to the Saudi-Egypt link, as Egypt itself is involved in negotiations to link its electricity grid to Italy, Cyprus and Greece.

Beyond financing, there are other challenges for both intra-Mena and intercontinental grid connections.

An efficient electricity exchange market is necessary, notes Obeid. Another key issue is the unsustainable increase in demand in Mena states. 

Figure1: Saudi-Egypt interconnector route

“Electricity demand is rising alarmingly, in direct relation to the impact of climate change and the increases in temperatures, cooling and water demand, which reduces the available supply for exports,” she says.

Plans to interconnect with Iraq, which has been heavily reliant on Iran for energy imports, can also be tricky. “The incentive is mostly political. Many countries have expressed interest in connecting their grids to Iraq’s, but none of these projects have yet materialised,” says Obeid.

“Linking Iraq to the Saudi grid is bound to be more viable and cheaper for Iraq compared to alternative options such as electricity exports from Jordan. But that is pending a political decision and would get Saudi Arabia and the GCC political and economic influence in Iraq.” 

https://image.digitalinsightresearch.in/uploads/NewsArticle/10842129/main.gif
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Riyadh qualifies five groups for One-Stop Stations PPP

    2 February 2026

    Saudi Arabia’s Roads General Authority (RGA), in collaboration with the National Centre for Privatisation & Public-Private Partnership (NCP), has qualified five groups for a contract to develop the kingdom’s One-Stop Station project on a public-private partnership (PPP) basis.

    The groups include:

    • Al-Ayuni Investment & Contracting Company / Al-Jeri
    • IC Ictas / Algihaz Holding / Al-Drees
    • TechTrade Global / Al-Habbas / Fuelax / Markabat / Naqleen Company
    • Petromin / Red Sea Housing
    • Asyad / Sasco

    The project includes the development of facilities at several locations across the RGA’s 73,600-kilometre intercity road network.

    The facilities include refuelling stations, commercial outlets, parking lots, driver rest areas, vehicle maintenance centres and other hospitality amenities.

    The project will be implemented under a 30-year design, build, finance, operate and maintain (DBFOM) contract, and will be tendered in three waves comprising six packages.

    The first wave will include the initial package, the second wave will encompass the second and third packages, and the third wave will cover the remaining three packages.

    In August last year, 49 Saudi and international firms expressed interest in the contract to develop the kingdom’s One-Stop Station project, as MEED reported.

    In January, Saudi Arabia launched a National Privatisation Strategy, which aims to mobilise $64bn in private sector capital by 2030.

    The strategy was approved by Saudi Arabia’s Minister of Finance and chairman of the National Centre for Privatisation (NCP), Mohammed Bin Abdullah Al-Jadaan.

    The strategy builds on the privatisation programme, which was first introduced in 2018. It will focus on unlocking state-owned assets for private investment and privatising selected government services.

    The value of PPP contracts in Saudi Arabia has risen sharply over the past few years as the government seeks to develop projects through the private sector and diversify funding sources

    PPPs have been used in Saudi Arabia and the wider GCC region for over two decades, but have primarily been limited to power generation and water desalination projects, where developers benefit from guaranteed take-or-pay power purchase agreements that eliminate demand risk.

    As capital expenditure continues to increase, the NCP is expected to add dozens more PPPs to its future pipeline to reduce the state’s financial burden and stimulate private sector involvement in the local projects market.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15551647/main.jpg
    Yasir Iqbal
  • Jordan allows phosphate rail line bidders more time

    30 January 2026

     

    Abu Dhabi’s National Infrastructure Construction Company (NICC), a subsidiary of Etihad Rail, has allowed contractors until 15 February to submit their proposals for a contract to build the second section of the phosphate railway line that will run from Ghor Al-Safi to Aqaba in Jordan.

    The tender was issued on 27 December, with an initial bid submission deadline of the end of January.

    The scope of work for the railway includes civil engineering, tunnel construction, and mechanical, electrical and plumbing (MEP) works.

    Tendering is also ongoing for the first section of the line. NICC is preparing to award the contract for the first section of the railway line, stretching from Al-Shidiya to Aqaba.

    MEED understands that the evaluation is in its final stages and that the contract will be awarded soon.

    In April last year, a French-Swiss joint venture of Egis and Arx was awarded the design consultancy contract for the project.

    Etihad Rail announced in September 2024 that it had signed a memorandum of understanding (MoU) worth $2.3bn with Jordan’s Transport Ministry and local companies to develop the phosphate railway line.

    In an official statement, Etihad Rail said it had signed an agreement with Jordan to build, operate and maintain the project.

    The statement added that additional MoUs were signed with Jordan Phosphate Mines Company and Arab Potash Company to transport 16 million tonnes a year of phosphate and potash from mining sites to the Port of Aqaba via the Jordanian railway network.

    The MoUs also cover the manufacture and supply of rolling stock; the construction of terminals in Aqaba, Ghor Al-Safi and Shidiya; and the maintenance, repair and operation of the railway line. 

    Project history

    In 2015, Jordan’s Transport Ministry tendered a contract to construct the Shidiya rail link, intended to transport 6 million tonnes a year of phosphate from mines in Shidiya to Wadi Al-Yutum, near Aqaba.

    In November of that year, a joint venture of China Communications Construction Company and the local contractor Masar United was confirmed as the lowest bidder. It was awaiting the formal award to build the 21-kilometre spur line.

    The project was subsequently put on hold due to funding issues.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15541534/main.jpg
    Yasir Iqbal
  • Acwa Power to develop $200m solar plant in Philippines

    30 January 2026

    Saudi Arabia’s Acwa Power is investing $200m to build a large-scale solar photovoltaic (PV) plant in the Philippines.

    The renewables developer finalised the agreement with the Philippine government-owned Bases Conversion & Development Authority (BCDA) on the sidelines of the World Economic Forum in Davos last week.

    Under the reservation agreement, a 500-hectare site has been selected within the New Clark City Special Economic Zone in Tarlac province, north of Manila.

    The project must undergo a pre-feasibility study, technical assessments and regulatory approvals before any final investment decision is made.

    The collaboration will also explore “potential battery energy storage system (Bess) integration,” Acwa Power said in a statement. 

    No details were provided on the project’s potential power generation capacity.

    The reservation agreement follows a memorandum of understanding (MoU) signed between Acwa Power and BCDA in Riyadh last November.

    Since then, the partners have evaluated multiple locations in New Clark City and shortlisted the 500-hectare site for further technical and commercial evaluation.

    Acwa Power said it is targeting a threefold increase in its global assets under management to $250bn by 2030.

    The company currently has a global renewables portfolio of 52GW, accounting for 56% of its total power capacity, and plans to deploy 5.6GWh of battery energy storage capacity.

    As part of its foreign investment plans, the company also recently signed major agreements for large-scale renewable energy projects in Uzbekistan.

    This comprised $1.8bn in financing for the Samarkand solar and battery energy storage project, Uzbekistan’s biggest solar development.

    The project is being developed in partnership with Japan’s Sumitomo Corporation, Chubu Electric Power and Shikoku Electric Power.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15541146/main.jpg
    Mark Dowdall
  • Algeria plans Constantine tramway extension

    30 January 2026

     

    Algeria is planning another extension of its Constantine tramway network, which currently runs from Ben Abdelmalek Stadium in the city centre to the Ali Mendjeli area.

    The project client, Algiers Metro Company (EMA), received bids on 14 December last year from consultants for a tender to undertake feasibility and detailed preliminary design studies for the project.

    The client had tendered the contract in October.

    The current tramway network spans approximately 19.3 kilometres (km).

    The tramway is owned by EMA and operated by Societe d’Exploitation des Tramways (Setram), a joint venture of EMA and French firm RATP Group.

    The first route of the tramway, with a length of 9km, was commissioned in July 2013, according to GlobalData’s sister company, Railway Technology.

    The expansion phase began in July 2015 and was completed in June 2019, increasing total ridership to over 30,000 passengers a day.

    The initial 9km-long section of the Constantine tramway system runs from the Zouaghi terminal to the Ben-Abdelmalek Stadium station through the old town and the university area.

    The route includes 11 stations, three of which are multimodal, two viaducts measuring 465m and 114m long, and an underpass.

    A 65,000-square-metre ground-level depot serves the fleet for maintenance and train parking.

    The Ben-Abdelmalek Stadium was renovated as part of the project to accommodate the line's passage.

    Contractors involved 

    EMA awarded a contract for the tramway line extension to France’s Alstom and the local firm Cosider Travaux Publics consortium in July 2015.

    Spanish firm Idom was awarded the detailed design and construction works management, while US-based engineering firm Aecom was responsible for civil engineering and urban planning.

    Cital, a joint venture of EMA, Spain’s Ferrovial and Alstom, delivered 24 trainsets to open the first phase of the extension in 2019.

    The company also maintains 51 trainsets and the infrastructure of the Constantine tramway.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15540773/main.jpg
    Yasir Iqbal
  • Dewa desalination plans offer timely boost

    30 January 2026

    Commentary
    Mark Dowdall
    Power & water editor

    Dubai Electricity & Water Authority (Dewa) is taking early steps towards procuring its second independent water producer (IWP) project, a signal that the utility may be further expanding its role from service provider to long-term utility asset developer.

    Consultancy bids were received this week for a pre-feasibility study that will assess capacity and location requirements for a planned seawater reverse osmosis (SWRO) desalination plant.

    The project, being pursued with Etihad Water & Electricity (EtihadWE), would build on the 180-million-imperial-gallons-a-day Hassyan IWP, awarded to Saudi Arabia’s Acwa Power in 2024.

    It would also align with Dewa’s wider objective to lift Dubai’s desalination capacity to 750 million imperial gallons a day by 2030, from around 495 million today. Achieving that target may require a further pipeline of privately developed water assets between now and then.

    A useful point of comparison lies in Saudi Arabia’s power sector. Saudi Electricity Company has increasingly relied on independent power producers over the past decade to accelerate capacity expansion, ease pressure on public capital spending and deepen the project finance ecosystem.

    For regional developers, competition in Saudi Arabia’s water market continues to intensify. In December, Saudi Water Partnership Company (SWPC) prequalified 50 developers to bid for five upcoming IWPs and 63 developers for independent sewage treatment plant (ISTP) projects.

    Unlike Saudi Arabia, the UAE entered 2026 with limited visible momentum in desalination. EtihadWE’s $400m Fujairah SWRO IWP is the only large desalination plant expected to be tendered this year.

    In a crowded market, increased activity by Dubai’s utility would provide a welcome boost.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15540724/main.jpg
    Mark Dowdall