SEWA power plans revealed

The state-owned Sharjah Electricity and Water Authority (SEWA) has announced plans to raise at least US $2.72 billion (AED10 billion) to increase power supplies within the Emirate.

SEWA director-general Al Waleed Khaleed bin Khadem explained that the financing is needed to meet expected increases in power demands of up to 9% per annum within the Emirate. SEWA plans to expand a 400MW power plant by more than six-fold to a capacity of 2,580MW by 2014 to meet these demands.

"There is a lot of growth and we have to prepare now to meet the [future] demands," stated bin Khadem. A number of options are being considered for the financing, including the sale of bonds or use of Sukuk, asset-backed Islamic bonds that pay holders a dividend rather than interest.

The power plant will be expanded in phases and also involve increasing the desalination capacity to over 545,000m3/day. Bidding for contracts to construct the project will close on 18 November. The project financing will be evaluated by SEWA following negotiations with the contractors.

Demand for power and water has risen sharply across the Gulf region following a boom in the economy and the related construction activity. The population of Sharjah has further expanded due to a commuting population working in the neighbouring Dubai.

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