Warming erodes Kuwait’s power and water reserves
14 August 2023
More on Kuwait’s power and water sector:
> IWPP: Firms respond to Kuwait independent utilities request
> POWER: Local firm wins 250MW Subiya package
> PRIVATISATION: Kuwait thermal plant privatisation to go ahead
The temperature in Kuwait soared to 51 degrees Celsius on 1 August, sending its electricity load index up to 16,940MW. This breached its maximum expected load this year of 16,830MW by 0.7 per cent.
This year’s projected maximum load is already 4 per cent higher than the previous year's recorded maximum load. It leaves only roughly 8 per cent of reserve capacity against an available capacity understood to stand at 18,250MW.
Similarly, water consumption across the Gulf state on 2 August, when the temperature decreased to 50 degrees, exceeded production by 29 million gallons, prompting the state utility to access its strategic water reserve capacity to plug the shortfall.
The electricity consumption spike reportedly caused two feeders at the country’s main substation south of Surra in the capital to trip, which led to power outages in some parts of Zahra, a district in Kuwait’s Hawalli governorate.
Kuwait’s Electricity & Renewable Energy Ministry (MEWRE) assured the public that the maximum capacity available in the country’s electricity network during the current summer is 18,250MW, as earlier cited, and that it could safely provide up to 17,660MW.
Persistent delays
The following week MEWRE – through the Kuwait Authority for Partnership Projects (Kapp) – received prequalification applications for the contracts to develop Kuwait’s next two independent water and power producer (IWPP) projects.
The two schemes – Al-Zour North 2 & 3 and Al-Khiran 1 – will have a total combined power generation capacity of 4,500MW and a water desalination capacity of over 150 million imperial gallons a day (MIGD), which will go a long way to address Kuwait’s precarious electricity and water supply situation.
Ironically, these two schemes have been in the planning and early procurement stages since 2017 and have suffered significant delays in the intervening period.
It is the second time developers have submitted statements of qualification (SOQs) for the contracts over the preceding 11 months.
The delays have caused major frustration for some developers and contractors. One utility developer that submitted an SOQ in September last year told MEED they did not participate in the latest attempt to start the prequalification process for the IWPP schemes, without elaborating.
Others expect the country’s stakeholders to eventually approve and expedite the procurement process for the integrated power and desalination facilities.
“I’m not very optimistic, but we submitted an SOQ anyway,” another source tells MEED.
EPC projects motoring ahead
The ministry’s conventional power plant projects have been moving at a relatively faster pace. In June this year, the local company Heavy Engineering Industries & Shipbuilding (Heisco) won a contract for the phase 2 upgrade of the Subiya power plant complex in Kuwait.
Heisco saw off competition from two local companies, Alghanim International and Al-Zain United General Trading & Contracting, for the KD114.28m ($372m) contract.
The project aims to convert an existing 250MW simple-cycle plant into a combined-cycle gas-turbine plant.
In April, a consortium comprising Heisco and Japan’s Mitsubishi Power was also awarded a contract to retrofit the main thermal power generation plant at the power complex.
The contract is understood to be valued at KD90.9m. It entails the upgrade of eight steam turbines and electric generators at the Subiya power plant, which is expected to reach a capacity of 2,400MW once the project is complete.
The existing plant at the Subiya power complex was commissioned between 1998 and 2002. This implies that the steam turbines and generators in commercial operation for nearly 20 years require upgrades to continue operating and improve their performance.
Two steps forward
While the country has pledged to become carbon neutral by 2060, the state utility has yet to make any remarkable progress in procuring new renewable energy capacity.
The recent political deadlock has hampered the procurement of the next phases of the Shagaya Renewable Energy Programme (SREP), despite the award 12 months previously of the project’s transaction advisory contract to a team led by London-headquartered consultancy firm EY.
At the time, the advisory contract was understood to cover the Al-Dibdibah solar project, which will comprise SREP’s second phase, and a third phase expected to include a 720MW solar photovoltaic (PV) plant, a 1,150MW concentrated solar power (CSP) facility and a wind power farm.
Notably, two state-backed downstream operators – Kuwait National Petroleum Company and Kuwait Integrated Petroleum Industries Company (Kipic) – have launched a tender for a contract to undertake a pre-feasibility study identifying opportunities to use renewable energy in their operations.
Kuwait is also expected to make some progress on its first utility privatisation scheme, which forms part of the initiative to strengthen private sector participation in the sector.
In December last year, it was revealed that UK-headquartered Deloitte had submitted a low bid of KD1.2m ($3.9m) for the transaction advisory contract in line with the planned privatisation of the $1.26bn North Shuaiba power and water plant in Kuwait.
GCC grid
While working to boost its electricity reserves and make its electricity systems greener, Kuwait stands to benefit from the ongoing upgrade of the GCC electricity grid, through which other GCC states, such as the UAE, may decide to transmit excess clean energy.
The Al-Fadhili high-voltage direct current (HVDC) converter station upgrade in Saudi Arabia is expected to enable the exchange of 1,800MW of electricity between the six states once complete.
In October last year, the GCC Interconnection Authority (GCCIA) awarded India-based KEC International a contract for an overhead transmission line project linking the substations in Wafra in Kuwait and Fadhili in Saudi Arabia.
The estimated $120m project extends an existing double-circuit 400kV line from Al-Zour in Kuwait to Ghunan in Saudi Arabia. The line has an intermediate interconnection at Fadhili, with associated substations completed in 2009 as part of the first phase of the GCCIA network. The new project is expected to complete in 2025.
This month’s special report on Kuwait also includes:
> ECONOMY: Stakeholders hope Kuwait can execute spending plans
> ENERGY: Kuwait’s $300bn energy target is a big test
> BANKING: Kuwaiti banks enter bounce-back mode
> INTERVIEW: Kuwait’s Gulf Centre United sets course for expansion
Exclusive from Meed
-
Syria makes progress towards reunification
24 April 2025
-
Gulf markets slide as US tariff shockwaves hit
24 April 2025
-
Market awaits Kuwait’s Shagaya solar tender
24 April 2025
-
Morocco starts tender process for LNG terminal
24 April 2025
-
Bahrain sets May deadline for Madinat Salman residences
24 April 2025
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends

Related Articles
-
Syria makes progress towards reunification
24 April 2025
Following the ousting of Bashar Al-Assad in late 2024, President Ahmed Al-Sharaa has rapidly consolidated power in Syria. He has transitioned from a militant and political outsider into a credible leader increasingly recognised in the region and on the world stage.
Within Syria, Al-Sharaa faces political, economic, military and civil challenges in pulling the country back together again. In recent weeks, a prominent focus has been the reunification of Syria’s fractured security landscape through the negotiated dissolution and integration of smaller rebel factions into a centralised military structure under the Ministry of Defence.
Rebel disbandment
Most recently, the new government brokered the dissolution of the Eighth Brigade, a 3,000-strong rebel group based in the southern city of Daraa that had waged an insurgency against the government of Bashar Al-Assad since 2018.
That outcome proved a relief to the government after its trustworthiness in talks was thrown into doubt by the chaos that erupted in Syria’s coastal region on 6 March as Islamist groups committed massacres against Alawite civilians in revenge over attacks by Assad loyalists.
On 9 March, Al-Sharaa appointed a committee to report on the violence, determine its perpetrators and theoretically hold them to account. That move caused some murmurings within his own ranks, but externally it showed the president’s commitment, in principle, to justice.
It also appeared to serve the political imperatives of the moment. Just a day later, on 10 March, the reassured Kurdish- led Syrian Democratic Forces (SDF) – representing tens of thousands of trained soldiers – signed a deal to integrate its forces into the national army.
The deal marked perhaps the most significant step towards national reunification so far, promising to restore to government control a swathe of northeastern Syria and its oil fields that has been largely lost to Damascus since the 2014 invasion by the Islamic State.
The integration of the SDF into the national military also appears to have been accepted by the US, which had been supporting the SDF military as an independent force in the northeast of the country, but has now announced the planned staggered withdrawal of its stationed troops.
Al-Sharaa has been making his rounds of the region in a diplomatic blitz aimed at shoring up regional support for his new government
Broader priorities
Alongside reconsolidating and restructuring the country’s military and security apparatus, Al-Sharaa’s main priorities are foreign affairs and economic policy. These two areas go hand in hand, given that removing international sanctions is key to reviving Syria’s economy.
In late March, Al-Sharaa entrenched his authority by enacting a new constitutional declaration, announcing a new transitional government and granting himself sweeping executive powers, including the right to appoint a third of the legislature and select judges for the constitutional court.
The cabinet was also broadened and reshuffled to address concerns over the lack of representation from minority communities. Individuals from the Alawite, Druze and Christian communities, as well as one woman, were appointed to ministerial positions.
The move further witnessed the replacement of the formerly appointed justice minister Shadi Al-Waisi, whose elevation embarrassed the government after 2015 videos surfaced of him presiding over street executions by morality police as part of the then Nusra Front. His removal was another reassuring step for observers that the government is attuned and reactive to constructive criticism.
With the right signals sent, Al-Sharaa has been making his rounds of the region in a diplomatic blitz aimed at shoring up regional support for his new government. He is likely also aiming to put the right words in the right ears, in the hope that they filter through the Gulf’s power lobbying system to the US.
Already on 30 January, just a day after Al-Sharaa became president, Qatar’s Emir Sheikh Tamim Bin Hamad Al-Thani flew to greet the man who displaced Al-Assad – a goal also long pursued by Doha. On 2 February, Al-Sharaa then took his first trip abroad to meet Saudi Crown Prince Mohammed bin Salman.
Some other regional governments have been more reticent to launch into renewed relations, but have increasingly come on board.
This includes Iraq, which, hesitant over Al-Sharaa’s past militant activity against Baghdad, only arranged a meeting between the Syrian president and Prime Minister Mohammed Shia Al-Sudani on 17 April in Doha – ultimately driven by shared security imperatives. Al-Sudani also invited Al-Sharaa to attend the upcoming Arab summit in Baghdad in May.
On 14 April, the equally green Lebanese Prime Minister Nawaf Salam also met with Al-Sharaa in Damascus – no doubt keen to address the recent border clashes between the two countries. A day earlier, Al-Sharaa was in Abu Dhabi to meet Sheikh Mohamed Bin Zayed Al-Nahyan, rounding out his visits to the key power brokers and budget holders in the Gulf.
Between all of these meetings, Al-Sharaa appears to have ingratiated himself with the region’s other leaders with remarkable rapidity and ease. A year after the Arab League reaccepted him in May 2023, Al-Assad had made little comparable progress.
For world leaders weary from years of dithering by Al-Assad’s government, which was unable or unwilling to even acquiesce to the Gulf’s most basic request – to stem the flow of the drug captagon from within Syria’s borders – Al-Sharaa is at least a partner who can do that and achieve far more besides.
For years, it has been the case that a reunified Syria and a rebuilt Syrian economy would lift the entire Levant region and any Gulf investors with it. The appetite in the region to see it succeed has been there. All that has been missing is a suitable partner in Damascus to move forward with.
https://image.digitalinsightresearch.in/uploads/NewsArticle/13747658/main.gif -
Gulf markets slide as US tariff shockwaves hit
24 April 2025
This package also includes:
> GCC shelters from the trade wars
> Lower oil prices raise Gulf’s fiscal pressure
> Gulf utility projects unbothered by Trump tariffs so far
Gulf markets fell sharply after the US announced a new tariff regime on 2 April, triggering declines as trading resumed after Eid. The 10% baseline import duty and levies on aluminium and industrial metals led to selloffs across regional indices.
Almost all major Gulf indices were dragged down by the tariff shock and began the week on Sunday 6 April with losses: Kuwait’s market dropped 5.7% and Qatar’s fell 4.2%, while the Muscat Securities Market Index declined 2.1% and Bahrain’s All Share Index fell approximately 2.5%.
Saudi Arabia’s Tadawul All Share Index (Tasi) fell 6.1% at the start of trading on 6 April, marking its steepest single-day decline since March 2020 and wiping out over SR500bn ($133.3bn) in value. The index partially recovered, rebounding 0.7% on 7 April and rising 3.7% on 10 April after the US announced a 90-day tariff suspension, its largest daily gain in nearly five years.
Almost all major Gulf indices were dragged down by the tariff shock
The Abu Dhabi Securities Exchange and Dubai Financial Market followed similar trajectories as trading resumed on Monday 7 April. Dubai’s DFM index dropped 3.1%, led by a 5.7% fall in Dubai Islamic Bank. Abu Dhabi’s main index slipped 2.6%, with Adnoc Gas down nearly 5%.
Both indices began recovering on 10 April. By 14 April, Dubai’s index had risen 1.8%, led by a 4.7% gain in Emirates NBD and a 3.2% rise in Dubai Islamic Bank, while Abu Dhabi’s index climbed 0.9%.
Equities dropped sharply across the region on 6 and 7 April, with blue-chip and sector-leading stocks in banking, real estate and energy posting heavy losses. The UAE’s Emaar Properties fell nearly 9% during intraday trading before closing 2.5% lower.
The aluminium sector came under scrutiny following the reinstatement of the 25% US import duty. However, the impact was limited, as Gulf aluminium exports, particularly from Bahrain and the UAE, represent a modest share of total output.
Oil price drop
The energy sector was not immune to the volatility. Brent crude dropped nearly 15% to around $64 a barrel – one of its steepest weekly declines in over a year. This slide is significant, given that fiscal breakeven oil prices are estimated at $90.9 for Saudi Arabia and $124.9 for Bahrain. Saudi Aramco lost over SR340bn in market value on 6 April before recovering 1% the next day.
Gulf petrochemicals producers also came under pressure. Saudi-based petrochemicals manufacturer Sabic is forecast to report a 47% year-on-year decline in Q1 earnings, according to a Riyad Capital report. The report cited softer product pricing and weaker demand from key markets including China and the US as the main cause.
Oil, energy and most petrochemicals products are exempt from US tariffs. While Gulf trade exposure to the US remains modest, the wider effects were felt through sentiment, capital flows and commodity pricing, and the deeper threat lies in reduced global demand, prolonged oil price weakness and weakened investor appetite.
https://image.digitalinsightresearch.in/uploads/NewsArticle/13732791/main.png -
Market awaits Kuwait’s Shagaya solar tender
24 April 2025
Kuwait’s Ministry of Electricity, Water & Renewable Energy (MEWRE), through the Kuwait Authority for Partnership Projects (Kapp), could issue the request for proposals (RFPs) for a contract to develop the Gulf state’s first utility-scale solar photovoltaic (PV) plant project before the summer.
According to an industry source, the independent power project (IPP) tender documents are awaiting final approval before they are released to the market.
MEWRE prequalified six consortiums and companies that can bid for the contract, MEED reported in August last year.
The Al-Dibdibah power and Al-Shagaya renewable energy phase three, zone one project is understood to have a capacity of 1,100MW.
The consortiums and companies prequalified to bid for the contract are:
- Acwa Power (Saudi Arabia) / Alternative Energy Projects Company (local)
- Trung Nam Construction (Vietnam)
- EDF Renewables (France) / Abdullah Al-Hamad Al-Sagar & Brothers Company (local) / Korean Western Power Company (Kowepo, South Korea)
- Jinko Power (Hong Kong) / Jera (Japan)
- Abu Dhabi Future Energy Company (Masdar, UAE) / Fouad Alghanim & Sons General Trading Contracting Company (local)
- TotalEnergies Renewables (France)
The 1,100MW solar PV IPP project is located in the Jahra governorate, about 100 kilometres from the capital, Kuwait City.
Kapp issued the request for qualifications for the contract in January 2024.
The package to be tendered comprises the Al-Dibdibah and Shagaya renewable energy phase three, zone one project, Kapp said when it issued the request for qualifications to interested bidders.
In August 2022, a team led by London-headquartered consultancy firm EY won the transaction advisory contract for the next phases of Kuwait’s renewable energy programme.
London-headquartered DLA Piper is the legal adviser, while Norwegian engineering services firm DNV is the client’s technical and environmental adviser.
2030-50 strategy
Kuwait aims to have a renewable energy installed capacity of 22,100MW by 2030 as part of the 20-year strategy that was announced in March and which ends in 2050.
Minister of Electricity, Water & Renewable Energy, Salem Falah Al-Hajraf, confirmed that the strategy also involves installing distributed or rooftop solar farms, with the state procuring the energy output from solar PV farms.
Kuwait aims to reach net-zero carbon emissions by 2060.
https://image.digitalinsightresearch.in/uploads/NewsArticle/13746421/main3315.jpg -
Morocco starts tender process for LNG terminal
24 April 2025
Morocco has issued a request for expressions of interest from contractors for its planned liquefied natural gas (LNG) import terminal at the Nador West Med Port.
Minister of Energy Leila Benali announced that the request had been issued during a conference in the Moroccan city of Ouarzazate.
During the event, Benali also said that a gas pipeline network will be built to connect the new terminal to the Maghreb Europe Gas Pipeline.
The network will supply existing and future power plants operated by the National Office for Electricity and Drinking Water, as well as industrial zones extending to Kenitra and Mohammedia.
It will be later linked to future LNG terminals on Morocco’s Atlantic coast and to the ongoing Nigeria-Morocco Atlantic Gas Pipeline project.
Benali said that the project is part of Morocco’s efforts to boost the country’s energy security and expand regional partnerships.
The project to develop the floating LNG Import Terminal in Nador West Med Port has an estimated value of $200m, according to the regional project-tracking service MEED Projects.
The scope of the project includes:
- Construction of a floating storage and regasification unit
- Construction of LNG storage tanks
- Construction of a natural gas liquids extraction unit
- Construction of a regasification terminal
- Marine facilities
- Installation of safety systems and other related infrastructural facilities
- Associated facilities
The client on the project is the Moroccan Agency for Sustainable Energy.
https://image.digitalinsightresearch.in/uploads/NewsArticle/13746393/main.jpg -
Bahrain sets May deadline for Madinat Salman residences
24 April 2025
Bahrain’s Ministry of Housing & Urban Planning has set 21 May as the deadline for a contract to construct 512 residential apartments on plots 15, 18 and 19 on Madinat Salman Island 12.
The tender notice was issued on 28 January this year.
Madinat Salman is a group of reclaimed islands located off the north coast of Bahrain.
The client also received bids for the project management consultancy contract in March.
The project is part of several schemes being developed by Bahrain’s Ministry of Housing & Urban Planning to address the kingdom’s housing demand.
Earlier this month, MEED reported that the client is seeking consultants to bid for a contract covering contract management and site supervision services for 507 villas in Madinat Al-Hidd – Village A2 and A3.
The tender notice was issued on 10 April, and the bid submission date is 4 June.
According to the official notice, the project is funded through the Kuwaiti grant under the GCC Development Programme to the Kingdom of Bahrain.
The economic output of Bahrain’s construction industry is expected to grow by 3.5% in real terms in 2025, supported by public and private sector investments in industrial, commercial and energy construction projects, coupled with a rise in the value of tenders awarded, according to a recently published report by GlobalData.
The total value of tenders awarded grew by 145.2% year-on-year in 2024, preceded by an annual growth of 114.1% in 2023, according to the Tender Board of Bahrain. However, high wage costs and declining construction loans are expected to pose significant downside risk to the industry’s outlook in 2025.
According to regional projects tracker MEED Projects, there were $2.8bn of contract awards in 2024 across all sectors, which includes construction, transport, oil and gas and power and water.
According to the Central Bank of Bahrain, the average value of outstanding loans and advances to the construction and real estate sector fell by 2.3% in the first 11 months of 2024.
In the remainder of the forecast period, the construction industry is expected to record an annual average growth of 4.9% in 2026-29, supported by investments in transport infrastructure and renewable energy projects aligned with Bahrain’s Economic Vision 2030.
Vision 2030 includes the BD11.3bn ($30bn) Strategic Projects Plan, unveiled in October 2021, which encompasses 22 national infrastructure projects. Developments include the creation of five new cities by 2030: Fasht Al-Jarm, Suhaila Island, Fasht Al-Azem, Bahrain Bay and Hawar Islands.
Growth in the forecast period will also be driven by investments under the National Renewable Energy Action Plan, which targets a 30% reduction in carbon emissions by 2035, compared to 2015 levels, and aims to achieve net-zero emissions by 2060.
https://image.digitalinsightresearch.in/uploads/NewsArticle/13746244/main.gif