Dubai Electricity & Water Authority, the government-run
utility, requested bids from international companies to build the emirate’s
first power plant with private investment, an adviser on the project said.
The 1,500-megawatt power station and water-desalination
facility would begin operations in 2015 at Hassyan on Dubai’s border with Abu
Dhabi, according to HSBC Holdings, which is advising the bidders.
“The request for proposals has just been released a couple
of days ago, and we should see bids in by October,” Jonathan Robinson, HSBC’s
Middle East head of project finance, said in an interview Wednesday. “The project
will be approximately $1.5bn.”
Dubai, the second-largest sheikhdom in the United Arab
Emirates after Abu Dhabi, is seeking to ensure its long-term energy supply by
encouraging investment and diversifying sources of electricity to include clean
coal, solar and nuclear power. While the UAE is the fourth-largest crude
producer in OPEC, Dubai produces less than four percent of the country’s oil.
Demand for electricity in the six-nation Gulf Cooperation
Council, which includes the UAE and Saudi Arabia, is likely to more than double
to 230,000 megawatts by 2030, Abdullah al- Shehri, the governor of Saudi
Arabia’s Electricity and Co- Generation Regulatory Authority, said last month.
“This is actually a turning point for the government of
Dubai and other governments that have in the past procured all of their power,
water, roads and rail through standard government procurement, and now we are
looking at a situation that’s not sustainable anymore,” Robinson said.
“If they need to continue to build that infrastructure,
which they do, and they don’t have the budgetary flexibility to do it as they
have done it in the past, they will have to do it differently.”
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