Saudi hires generators to beat power shortage

Aggreko, the British temporary power supplier, has signed a contract to provide 100 megawatts of power for about three months.

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The Saudi Electric Company (SEC) is hiring generators to help it overcome summer electricity shortages affecting the Gulf's biggest oil exporter. Aggreko, the British temporary power supplier, has signed a contract to provide 100 megawatts of power to the Saudi utility for three months, bringing to more than 170Mw the total generating capacity it supplies in Saudi Arabia. The firm said its international power division was providing electricity to utilities, government installations, armed forces and major industrial users at six locations in the Qassim region, north of Riyadh. Summer power shortages were common, it said. The announcement came as a group of Saudi businessmen and industrialists reportedly said they were planning to sue Saudi Electricity for failing to fulfil its commitment to provide an uninterrupted power supply. "We will file a lawsuit against SEC for its dereliction of duty," said Hamoud al Hajla, the group's lawyer, according to a local media report. Several Saudi cities and regions have suffered power disruptions in recent weeks. Last week, power cuts caused problems at industrial sites in Jeddah, the kingdom's second-biggest city. Frequent power supply interruptions were creating "huge setbacks" for Jeddah's manufacturing industry and some factories might shut down, according to Sameer Murad, the head of the factory committee at the Jeddah Chamber of Commerce and Industry. Despite having the world's biggest proved oil reserves and significant gas deposits - both of which it taps to fuel power plants - Saudi Arabia has failed to develop enough generating capacity to meet its electricity needs during the summer peak. The seasonal shortages have emerged over the past few years as the Saudi economy boomed during a seven-year bull run in oil prices that spurred the government to launch industrial developments aimed at economic diversification. In the medium term, the kingdom is seeking to alleviate its electricity problems by linking its power grid to those of other Gulf states, in a move that would allow power supplies to be optimised across a broader region. It is also exploring a proposed hook-up with Egypt's grid. In addition, the national petroleum company Saudi Aramco has recently said it was switching its development focus to gas from oil to help raise domestic gas supplies to its power and petrochemical sectors.