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Power and water assets face strategic risk amid Iran attacks

4 March 2026

 

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Recent attacks on energy infrastructure across the GCC have drawn renewed attention to the strategic importance of the region’s power and water sector.

On 2 March, Qatar’s Ministry of Defence announced that the country had come under two drone attacks launched from Iran.

One drone targeted a water tank owned by Mesaieed Power Plant, while another targeted a power facility in Ras Laffan Industrial City.

Elsewhere in the region, Saudi Aramco shut down its Ras Tanura refinery following a drone strike, while US cloud provider Amazon Web Services reported service outages after incidents at two data centres in the UAE.

Desalination reliance

Across the GCC, desalination now provides the majority of drinking water. In both Kuwait and the UAE, over 90% of potable water comes from desalination plants while in Saudi Arabia and Oman the figure is about 70% and 86%, respectively. While the geopolitical narrative tends to be dominated by oil, it is power and water infrastructure that is perhaps most critical to everyday life.

For instance, the Ras Al-Khair desalination plant in Saudi Arabia is among the largest operational facilities of its kind. According to MEED Projects, the plant produces about 1.1 million cubic metres a day (cm/d) of desalinated water.

Using a typical domestic water consumption benchmark of roughly 250 litres per person per day, that output is sufficient to supply potable water for around four million people.

Other large projects operate on a similar scale. The Yanbu phase 3 desalination plant produces roughly 550,000 cm/d, while the Shuaibah 3 independent water project (IWP), commissioned near Jeddah last year, has a capacity of 600,000 cm/d. Facilities of this scale can supply drinking water to populations of between two million and four million people.

The region’s reliance on large coastal desalination facilities also creates structural vulnerabilities, as most plants are located along the Gulf coastline to allow seawater intake.

Many are also integrated with thermal power plants, producing electricity and desalinated water at the same site. This configuration offers operational efficiencies, but concentrates critical infrastructure in a limited number of locations.

In February, Kuwait signed a 25-year energy conversion and water purchase agreement for the Al-Zour North independent water and power plant (IWPP) phases two and three. Once completed, the facility will add 2,700MW of power and 545,000 cm/d of desalinated water to Kuwait’s supply network

Separately, Kuwait’s Council of Ministers recently approved plans for the Kuwait Authority for Partnership Projects (Kapp) to tender the first phase of the Nuwaiseeb power and water desalination plant as an IWPP project. The first phase of the scheme will have an estimated power generation capacity of 3,600MW and a desalination capacity of 341,000 cm/d.

While several GCC states maintain strategic water storage reserves, these typically cover only a limited number of days of consumption in major cities. This makes water infrastructure one of the most sensitive categories of critical assets in the region.

Electricity infrastructure

Standalone electricity infrastructure is equally central to the functioning of GCC economies. Power generation supports residential demand, large industrial complexes, transport networks and digital infrastructure.

One example is the UAE’s Barakah nuclear power plant in Abu Dhabi, which has a total capacity of 5.6GW across four reactors. According to Emirates Nuclear Energy Corporation (Enec), the plant’s four APR1400 reactors produce 40TWh annually, which is equivalent to around 25% of the UAE’s electricity needs.

At the same time, Gulf electricity systems are becoming increasingly interconnected. The GCC Interconnection Authority grid links the national networks of member states and enables countries to exchange electricity during periods of peak demand or supply disruption.

As noted by WorldBank studies, desalination plants typically operate continuously because water storage capacity is limited relative to demand. Similarly, power grids must balance supply and demand in real time.

Amid ongoing missile and drone attacks on GCC states, Iran said on Monday that it was closing off the Strait of Hormuz, a critical maritime route. GCC countries import roughly 85% of their food, much of it transported by sea, while the strait handles about a fifth of global oil supply. Disruptions to power and water infrastructure across the region could have even more immediate consequences.

READ THE MARCH 2026 MEED BUSINESS REVIEW – click here to view PDF

Riyadh urges private sector to take greater role; Chemical players look to spend rationally; Economic uptick lends confidence to Cairo’s reforms.

Distributed to senior decision-makers in the region and around the world, the March 2026 edition of MEED Business Review includes:
To see previous issues of MEED Business Review, please click here
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Mark Dowdall

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