Hitachi Energy rides HVDC boom
12 November 2024
The GCC region’s strong drive to decarbonise electricity generation, distribution and consumption has led to an increased demand for renewable energy and electric mobility, which in turn require strong, secure and reliable grids.
“The key issue [among stakeholders] is how to stabilise the grid and maintain its resilience to ensure safety and security of supply,” Bruno Melles, global managing director for the Transformers Business Unit at Zurich-headquartered Hitachi Energy, tells MEED.
Options to address this issue include offshore and onshore interconnections, particularly through high-voltage direct current (HVDC) networks, as well as the deployment of battery energy storage systems.
HVDCs are broadly considered more environment-friendly compared to their alternating current predecessors by allowing electricity transmission over long distances with minimal losses.
Several HVDC networks are under construction across the GCC states. The region’s first subsea power transmission network in Abu Dhabi replaces existing offshore gas turbine generators catering to Adnoc’s offshore operations with more sustainable power sources available in Abu Dhabi’s onshore power network.
The Saudi-Egypt interconnection is also underway. Once completed, it will enable the daily exchange of up to 3,000MW of electricity, opening up potential energy trade between the GCC and other countries in the Gulf, Africa and Europe.
Saudi Arabia also recently awarded a $5.3bn contract to interconnect its western, central and southern regions through an on-land HVDC network.
In addition, in May this year, Hitachi Energy signed agreements with Enowa, the utility arm of Saudi gigaproject developer Neom, to supply three HVDC transmission systems with a total capacity to transmit up to 9,000MW of electricity.
Discussions are under way for more of these types of projects, notes Melles, who says these projects reflect the need to integrate and secure the grid, particularly as more countries consider cross-border links and connecting their existing grids to remote renewable energy plants.
As interconnection investments grow, the need for digitalisation will also grow as utilities and transmission system operators seek more precise ways to manage their electrical loads and avoid waste.
Large users
The presence of industries with high power demands such as refining has been a distinguishing feature of most GCC states' power systems.
Most recently, the drive to deploy AI-based applications has spurred a boom in data centre construction particularly in the UAE and Saudi Arabia.
“We’re seeing plans to build data centres with load capacities of up to 1,000MW,” explains Melles, who points out that these facilities are fast becoming a major power utilisation point similar to other large industries.
The International Energy Agency estimates that data centres represent roughly 2% of global power consumption in 2022 and this is expected to more than double to 5% to 6%, according to various projections.
An increase in the large power user base, even as electrification increases, reinforces the need for more resilient grids that can deal with varying loads and distances and energy sources, according to Melles.
Meeting demand
Globally, transmission and distribution infrastructure buildout is expected to catch up with prolific investments to expand generation capacity as power and decarbonisation demands increase.
Across the GCC, an estimated 49,000MW of conventional and renewable energy power generation plants are under construction as of October this year. The project pipeline remains robust, with key jurisdictions such as Saudi Arabia and Abu Dhabi aiming for renewable sources to meet up to 50% of their electricity demand by the end of the decade.
The GCC region’s power transmission and distribution sector is also set to experience its best year in terms of the value of awarded contracts.
According to data from regional projects-tracking service MEED Projects, the total value of awarded contracts for substations, control centres, overhead lines and cables across the six GCC states reached an estimated $13.8bn between January and September 2024.
This figure already exceeds by 81% the total value of contracts awarded in the preceding full year.
To meet demand, Hitachi Energy, which supplies solutions ranging from large transformers, communication networks, cooling systems and cybersecurity to cable accessories, recently launched a $1.5bn programme to boost its transformer production capacity between 2024 and 2027.
“We need to scale up capacity and availability, and we are committing with our parts suppliers… to be able to supply [transformers] to the industry,” explains Melles.
Hitachi Energy is also, more crucially, investing in human resources as it expands its production capacity and presence globally. "We are investing in people across all skill levels in our company not just in our factories… because we believe resource constraints will be more serious than steel or copper constraints."
The executive notes that in addition to driving power demand, AI is a key development that suppliers like Hitachi Energy are following closely due to its potential to transform industries over time.
Current AI applications enable predictive maintenance and reliability, where they can analyse data from sensors and maintenance records to predict when equipment may fail.
The next stage, which Melles expects will cause widespread disruption, is when AI is applied to industrial process and engineering optimisation, which experts say may lead to increased efficiency, reduced resources and improved product quality, among others.
“AI offers a great opportunity if used properly,” the executive concludes.
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GCC presses ahead with tourism projects
29 June 2026
> This package also includes: Dubai eyes tourism sector recovery
Hotel and resort construction in the GCC has proven to be more resilient than many would have predicted. According to regional project tracker MEED Projects, the value of hotel and resort construction contracts awarded in the region has so far reached $5.3bn in 2026, already surpassing the full-year total of $3.2bn recorded in 2025.
The 2026 figure is already the highest since 2024, when $6.1bn in contracts were awarded, and sits above every year from 2020 to 2023, despite the disruption to visitor flows since conflict broke out on 28 February.
Last year’s total was the weakest in the post-pandemic period, suggesting that the awards now coming through may partly reflect delayed commitments that were held back during a period of elevated construction cost inflation before being released into the market as conditions stabilised.
Future pipeline
The near-term outlook for new project commitments is uncertain, with developers and investors watching the conflict’s trajectory and its effect on visitor demand before finalising capital allocation. While there is caution, governments have signalled a firm commitment to their tourism ambitions.
The clearest signal came in late May, when Alec Engineering & Contracting received a letter of award for the construction of the Sphere Abu Dhabi, a $1.7bn immersive entertainment venue to be built on Yas Island. That Abu Dhabi was prepared to formalise a contract of this scale during an active regional conflict carries its own significance: sovereign-backed tourism infrastructure programmes are not being paused.
In Dubai, another major contract award is approaching. Dubai Holding is preparing to appoint a contractor for the Jumeirah Asora Bay Hotel in the La Mer area, developed alongside the Jumeirah Residences Asora Bay in partnership with Meraas. The proximity of the contract award to the conflict period indicates the same institutional logic: Dubai’s long-term tourism infrastructure programme continues to advance on its own timeline, independent of near-term demand conditions.
Upgrade cycle
If governments are pressing ahead with new tourism infrastructure, operators of existing properties are turning the reduced footfall to their own advantage. A wave of hotel refurbishments has gained pace in Dubai in recent months, with several properties having closed or partially closed for renovation work that, in many cases, had been planned well before the conflict began. The reduction in visitor numbers has created an opportune window to carry out disruptive works without sacrificing commercial performance.
The most prominent examples are the Jumeirah Burj Al-Arab, which has closed for an 18-month restoration programme, and the Armani Hotel Dubai, which occupies floors within the Burj Khalifa and has also closed for a full overhaul, with a planned reopening in the last quarter of 2026.
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Dubai eyes tourism sector recovery
29 June 2026
Dubai’s tourism sector was in a position of strength when the regional conflict began on 28 February.
Full-year figures published by the Dubai Department of Economy & Tourism (DET) in February confirmed that the emirate welcomed 19.59 million international overnight visitors in 2025, a 5% increase on the 18.72 million recorded in 2024, and a third consecutive year of record-setting arrivals. The city received more than 2 million visitors in a single calendar month when December 2025 closed with 2.04 million arrivals, 6% ahead of the same period in 2024.
Average hotel occupancy in Dubai’s 827 properties reached 80.7% in 2025, up from 78.2% in 2024. Revenue per available room rose 11% year-on-year to AED467 ($127), while the average daily rate increased 8% to AED579 ($158).
By the end of December, the city’s hotel room inventory stood at 154,264, ahead of cities including Bangkok, New York, Paris and Singapore.
Western Europe remained the largest source market, contributing 4.1 million arrivals and accounting for 21% of total visitors, while the GCC and Middle East and North Africa regions together represented 26% , with 2.99 million and 2.17 million arrivals, respectively. South Asia, the CIS and Eastern Europe each contributed 2.89 million visitors.
The regional context was similarly buoyant. According to the World Travel & Tourism Council’s (WTTC) 2026 Economic Impact Research, Middle East travel and tourism GDP expanded 5.3% in 2025, outpacing the global sector average of 4.1%.
The UAE’s travel and tourism sector reached $68.5bn in GDP contribution in 2025, with international visitor spending of $56.9bn. Pre-conflict, WTTC had forecast $207bn in international visitor spending across the Middle East for 2026.
Sudden shock
The outbreak of conflict on 28 February produced a swift and serious impact across the regional tourism ecosystem. Within days, the WTTC estimated losses of at least $600m a day in international visitor spending across the Middle East, as air travel was disrupted, traveller confidence weakened and regional connectivity fractured.
The major Gulf aviation hubs including Dubai, Abu Dhabi, Doha and Bahrain, which together process about 526,000 passengers daily, experienced closures and operational disruption. On the day the conflict began, the EU Aviation Safety Agency issued a bulletin on the dangers of flying in the airspace of 11 countries, including the UAE, Saudi Arabia, Bahrain, Qatar, Oman and Kuwait.
The data for the first quarter of 2026 reflects the scale of the disruption. According to UN Tourism’s latest World Tourism Barometer, international arrivals across the Middle East fell 14% in the first quarter of 2026, with hotel occupancy in the region declining sharply to 48% in March from 75% in January, against a global average of 64%.
International air traffic among Middle Eastern carriers fell 61% in March, measured in revenue passenger-kilometres, according to the International Air Transport Association (Iata), dragging overall global international traffic into modest contraction for the month.
The conflict also introduced structural complications that extended beyond the immediate decline in arrivals. Several major source markets, including the UK, issued advisories against all but essential travel to the UAE. The UK’s Foreign, Commonwealth & Development Office (FCDO) guidance cited the risk of renewed strikes on civilian infrastructure, including ports, hotels, roads and airports, and advised residents to consider departing if their presence was not essential.
The divergence from Dubai’s own official position, which characterised the emirate as stable and operationally normal, created a coverage gap that complicated conventional travel insurance provision and suppressed bookings from key markets.
On 18 June, the UK updated its position, removing the advisory against all but essential travel to the UAE and noting that commercial flight routes to depart the region remain available. The change marks a significant shift in the formal risk landscape for one of Dubai’s most important source markets, removing a barrier that had complicated both insurance provision and leisure booking decisions across the UK market for nearly four months.
Emirates and Etihad Airways both moved to address the insurance gap directly ahead of the FCDO change. On 17 June, Emirates launched a comprehensive travel cover product developed in partnership with insurance provider Travel Guard, offering medical cover for conflict-related incidents, trip cancellation cover, compensation for baggage delay or loss, and unlimited medical expense and emergency evacuation cover worldwide. The product is available across 27 markets.
Emirates also committed to rebooking disrupted customers at no additional cost where flights have been cancelled due to conflict-related disruption, including itineraries connecting on other carriers.
Arrivals data
Data from UK-based analytics firm GlobalData illustrates both the scale of the expected contraction and the strength of the projected recovery. UAE international arrivals, which reached approximately 30 million in 2025, are forecast to fall to about 26.4 million in 2026 – a decline of roughly 12% – before rebounding sharply to 32.1 million in 2027.
GlobalData’s projections then show continued growth to about 33.5 million in 2028, 35.1 million in 2029 and 36.6 million by 2030.
On that trajectory, arrivals would exceed pre-conflict levels within a single year of recovery and surpass 2025 figures by more than 7% in 2027 alone.
The GlobalData numbers place the 2026 contraction in a longer historical context. UAE arrivals grew almost uninterrupted from 8.4 million in 2009 to 25.6 million in 2019, before collapsing to 8.4 million in 2020 at the height of the Covid-19 pandemic. The subsequent recovery was among the fastest recorded for any major destination: arrivals reached 22 million in 2022, crossed 26.3 million in 2023 and climbed to 28.7 million in 2024 before the 2025 peak.
That precedent – a two-thirds collapse followed by full recovery within three years – underpins the confidence embedded in GlobalData’s post-conflict forecast, which projects a return to growth momentum by 2027 and a trajectory that would deliver 36.6 million arrivals by 2030.
The near-term contraction nevertheless remains substantial. A decline from approximately 30 million to 26.4 million in a single year represents the sharpest drop in UAE arrivals outside the pandemic, and it comes at a point when the sector had been tracking well ahead of pre-pandemic levels.
Past experience
Historical precedent from comparable disruptions points to a consistent pattern: recovery shape is determined less by the severity of the initial decline than by the duration of the disrupting event and the speed at which the perception of the source market resets.
Single-event incidents with clear endpoints and no sustained security overhang have historically produced the fastest recoveries, with arrivals returning to trend within 12 months. Sustained conflicts or events that trigger prolonged travel advisory regimes produce more extended recovery arcs, with source market confidence rather than operational conditions defining the timeline.
The Egypt Metrojet bombing in 2015 remains the most instructive cautionary example for the Gulf: Russian airspace restrictions imposed after the incident kept a major source market out of the Egyptian market for more than five years, with arrivals recovery lagging the resolution of the underlying security concern by a significant margin.
The UAE’s own Covid recovery offers a relevant local reference point. The GlobalData numbers show arrivals collapsed from 25.6 million in 2019 to 8.4 million in 2020, before recovering to 21.9 million in 2022 and surpassing pre-pandemic levels by 2023. The post-conflict recovery forecast of a bounce back to above 2025 levels by 2027 is less aggressive than the post-Covid rebound, reflecting both the more moderate scale of the 2026 contraction and the more complex advisory and perception dynamics involved in a conflict resolution scenario.
The DET’s response is structured around three priorities: operational continuity, sector support and market confidence. The government announced a AED2.5bn ($612.7m) support package targeting the tourism, hospitality and entertainment sectors, structured to protect business continuity, preserve employment and maintain visitor experience standards. Dubai is doing all it can, but much depends on how quickly perceptions shift.
Pilgrimages drive Saudi tourism
More than 1.7 million pilgrims performed Hajj in 2026, according to official data published by Saudi Arabia’s General Authority for Statistics, underscoring the continued centrality of religious tourism to the kingdom’s visitor economy.
The total of 1,707,301 pilgrims comprised 1,546,655 from outside the kingdom and 160,646 internal pilgrims, which includes Saudi citizens and residents.
The vast majority of international pilgrims arrived by air, with 1,485,729 using this mode of transport. A further 54,429 arrived overland and 6,497 by sea. Pilgrims represented 165 nationalities, reflecting the global reach of the event.
The scale of the logistical operation accompanying Hajj is equally significant. Supporting the pilgrimage required 441,049 workers and 26,701 volunteers. Saudi Arabia’s pre-clearance programme, which processes travel documentation at the point of departure to streamline entry to the kingdom for participants from select countries, was used by 388,694 pilgrims.
Hajj is a structural pillar of Saudi religious tourism, which alongside Umrah, draws tens of millions of visitors to Mecca and Medina each year. The sector sits at the core of Vision 2030’s tourism diversification strategy, which targets 150 million visits a year by the end of the decade.
Continued investment in transport infrastructure, including the expanded King Abdulaziz International airport and Haramain high-speed railway capacity, will help Riyadh achieve this target.
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Sharakat extends bid deadline for Riyadh East treatment plant
29 June 2026
State water offtaker Sharakat has extended bidding for the contract to develop the $150m Riyadh East independent sewage treatment plant (ISTP).
The bid submission deadline has been moved from 30 June to 11 August, a source told MEED.
The plant will have a treatment capacity of 200,000 cubic metres a day (cm/d) in its first phase, expanding to 500,000 cm/d in the second phase.
In May, MEED exclusively reported that at least six consortiums were preparing to submit bids for the project, which will be developed under a build‑own‑operate‑transfer model with a 25‑year concession term.
These include:
- Suez (France) / Civil Works Company (Saudi Arabia) / Alwael (Saudi Arabia)
- Saur (France) / Samsung E&A (South Korea) / Al-Bawani (Saudi Arabia) / Nesma (Saudi Arabia)
- Alkhorayef (Saudi Arabia) / GS Inima (Spain)
- EtihadWE (UAE) / Metito (UAE)
- Veolia (France) / AlJomaih Energy & Water (Saudi Arabia)
- Miahona (Saudi Arabia) / Marafiq (Saudi Arabia)
In December 2025, a group comprising Metito, EtihadWE and SkyBridge was selected as the preferred bidder for the Hadda ISTP project. The Miahona, Marafiq Company and Buhur for Investment group was selected as the reserved bidder.
That same month, the Miahona-led consortium was selected as the preferred bidder for the Arana ISTP and the Metito-led consortium was selected as the reserved bidder. Both projects have yet to reach financial close.
In 2024, Sharakat prequalified 53 companies to bid for the Riyadh East ISTP, one of seven planned ISTP projects it said it would procure between 2024 and 2026. The request for proposals was issued last October.
WSP is the technical adviser, and KPMG Middle East is the lead and financial adviser on the project.
The targeted commercial operation date for the facility is 2029.
ISTP plans
According to Sharakat’s recent seven-year statement, it has identified six additional large ISTPs in the development pipeline.
These are:
- Kharj (75,000 cm/d)
- Abu Arish (50,000 cm/d)
- Hafar Al-Batin (100,000 cm/d)
- Riyadh North (TBD)
- Najran South (50,000 cm/d)
- Khamis Mushait (50,000 cm/d)
The company is also pursuing a nationwide small sewage treatment plant programme covering about 139 smaller ISTPs grouped into seven clusters.
These are designed to add about 521,450 cm/d of additional treatment capacity across the kingdom.
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Chinese contractor wins Qiddiya Northwest transport hub
29 June 2026
Saudi gigaproject developer Qiddiya Investment Company (QIC) has awarded a contract to build a new transport hub in the entertainment city of Qiddiya on the outskirts of Riyadh.
The contract was awarded to Beijing-headquartered China State Construction Engineering Corporation.
The project is located within the resort core zone of the development.
MEED understands that its scope covers the construction of a parking structure for up to 2,000 vehicles; a transport hub consisting of a passenger flow system, ticketing and transit-related activities; retail, food and beverage, and hospitality facilities; mechanical, electrical and plumbing systems; and soft and hard landscaping works.
Earlier this year, MEED exclusively reported that QIC had tendered a contract to build a new transport hub.
Local firm Ammico Contracting undertook the site enabling works.
QIC is accelerating plans to develop additional assets at Qiddiya City.
Last week, MEED reported that QIC had invited contractors to prequalify for a contract to build an indoor sports arena within its Qiddiya entertainment city project.
The multipurpose arena is designed to International Olympic Committee standards.
It will be located in District 18, in the Uptown South area of Qiddiya.
Once completed, the indoor arena will be capable of hosting a wide range of sports, cultural and entertainment events.
The arena will feature numerous sports courts for basketball, handball, futsal, volleyball, tennis, boxing and gymnastics.
It will have a seating capacity of 18,000 spectators.
QIC’s other major projects include an e-sports arena, the National Tennis Centre, Prince Mohammed Bin Salman Stadium, a motorsports track, a racecourse, the Dragon Ball and Six Flags theme parks, and Aquarabia.
QIC opened the Six Flags theme park to the public in December last year.
The park covers 320,000 square metres and features 28 rides and attractions, including 10 thrill rides and 18 aimed at families and young children.
The Qiddiya project is a key part of Riyadh’s strategy to boost leisure tourism in the kingdom.
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Saudi’s WTCO considers equity model for water schemes
29 June 2026
Saudi Arabia’s Water Transmission Company (WTCO) is understood to be considering changes to the delivery model for the flagship Jubail-Buraidah and Ras Mohaisen-Baha-Mecca independent water transmission system (IWTS) projects.
According to a source familiar with the plans, WTCO is in ongoing discussions with potential partners to establish a special purpose vehicle (SPV) that would take equity stakes in the two projects.
The proposed changes could push procurement for the project into 2027, the source said.
The schemes will have a combined water capacity of almost 1.4 billion cubic metres a day (cm/d). The Jubail-Buraidah IWTS comprises an approximately 348-kilometre-long greenfield water transmission system with a capacity of 840,650 cm/d, delivering water from the Ashmasiah reservoirs to cities and towns in Al-Qassim province.
The Ras Mohaisen-Baha-Mecca IWTS involves constructing an approximately 325km-long greenfield IWTS with a capacity of 542,000 cm/d, delivering water from Ras Mohaisen to the Adham and Aradhiyah regions.
The Jubail-Buraidah project is large by WTCO standards. The company’s second phase of the Khobar-Hofuf system, completed in 2024, was 140km in length and had a capacity exceeding 530,000 cm/d.
Bidding for both schemes has been extended several times since tendered last September under the public-private partnership model.
Most recently, the bid submission deadline was moved to 2 August for the Jubail-Buraidah IWTS and to 9 August for the Ras Mohaisen-Baha-Mecca IWTS.
As previously reported, local firms Alkhorayef Water & Power Technologies, Mutlaq Damook Al-Ghowairi Contracting, Saudi Services for Electro Mechanic Works and Al-Rawaf Trading & Contracting, among other companies, were expected to submit bids for the main contract.
Under the revised structure, the SPV would appoint the engineering, procurement and construction (EPC) contractor directly.
WTCO was established in 2020 as part of Saudi Arabia’s water sector restructuring to develop and operate water transmission infrastructure on a more commercial basis, with a greater emphasis on private-sector participation and alternative financing models.
There are also plans to tender a contract for phase two of the Ras Mohaisen water transmission system project. This includes laying water transmission pipelines 408km in length with a capacity of 400,000 cm/d. This project is estimated to cost about $600m.
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