Exclusive: Sharjah's utility provider targets electricity self-sufficiency by 2021

Sharjah Electricity and Water Authority (Sewa) - the utilities provider for the northern emirate targets power self-sufficiency by 2021, as it looks to build domestic capacity, plug water leakages and privatise parts of its business, the agency's chairman said.

“The growth rate in this country, especially Sharjah has reached five per cent last year and we’re expecting the same in 2018 and in 2020 because of the Expo’s [2020] impact on us,” said Mr Rashid Alleem in an interview with The National.

Sharjah needs power self-sufficiency to keep up with a growing population that is set to reach almost two million by 2020, making it the second-most populous emirate. It’s current population stands at 1.4 million and is overwhelmingly expatriate - most of whom employed in neighbouring Dubai but live in Sharjah because of its relatively low cost of living. The emirate is also diversifying its sources of gas supply to meet power generation requirements. State-owned Sharjah National Oil Company plans to deploy a floating storage and regasification unit (FSRU) by 2019, which is also set to meet Sewa’s demands for power generation.

“When it comes to the generation-side, the electricity, we’re planning to improve the generation by 1.5GW, which is 1500MW and that will be done in Hamriyah power plant in three stages, and hopefully, stage one will be ready in 2019 followed by stage two in 2020 and [by] 2021, we’ll have all three stages commissioned and that will meet the whole demand," said Mr Alleem. “At the moment, we’re importing the energy part of it from the national grid, which is about 700MW to 1200MW that is what we’re importing at the moment, depending on the season and the need.”

The independent power plant will be developed on the basis of build own operate transfer model, he added.

“We’re planning to buy from them SNOC, there’s an agreement already signed between us and them and this will again diversify and ensure the longterm gas supply,” said Mr Alleem.

The utilities provider is now targeting a complete revamp of its water transmission network. It plans to optimise the Hamriyah RO [reverse osmosis] plant, which is designed to produce about 20 million gallons a day. It currently yields 17 million gallons daily. Sewa can make up the shortfall by improving the efficiency of the operation and retrofit parts of the plant, Mr Alleem said. The agency has a plan in place and consultants have carried out an assessment, he said.

Sewa is also looking at plugging non-revenue water, which is unseen water that is lost underground because of an ageing network and pipes leak.

"The main transmission pipes need to be totally replaced with new ones. That will take us about three to five years because it’s more than 3,000 km length of network,” Mr Alleem said.

The Sharjah-based operator is also mulling privatising segments of its business, while balancing the needs and sensibilities of a very price-conscious largely middle class customer base.

“It has to be a mix, privatisation has to be there," he said, adding "midstream and downstream is outsourced and we’re getting the private sector to be part of it."

In August, the authority awarded its first build-operate-transfer contract for development of a two million gallon-per-day seawater RO plant in Sharjah’s eastern region of Kalba as part of its efforts to engage the private sector in its development programmes. In 2011, it enlisted five private companies to provide natural cooking gas to households in Sharjah.

However, Sewa says it has no plans to list any segments of the business for now.

“No, not at this time, no. It’s premature to talk about these things,” he said.

While neighbouring Dubai has planned to add 44 per cent of its electricity from renewable energy by 2050 and is developing the world’s largest solar power park, Sharjah’s utility provider would rather consumers developed their own “mini-grids” to make their own savings on their bills.

“Most of the investment goes to the PVs [photovoltaics] now, and the concentrated solar power companies went bankrupt because investors are not willing to put money there, so that’s why we took it easier to see what kind of competitive price we can get,” said Mr Alleem.

“Second, this is still under a lot research in this part of the world because we have two factors - sand and humidity - and when they combine, it’s disastrous for the panels. The efficiency will drop so fast, so we need to find a way to overcome this."