GCC power construction contracts to record 41% increase in 2018
By Staff Report
Published: Tue 9 Jan 2018, 4:27 PM
Last updated: Tue 9 Jan 2018, 8:15 PM
The value of power construction contracts awarded throughout the GCC in 2018 will reach $23.6 billion, according to a report by Middle East Electricity (MEE), the region's leading annual international trade event for the power industry.
The figure represents a substantial 41 per cent increase on 2017. The report highlights that Saudi Arabia will lead the awards ranking, accounting for 59 per cent of contract value, followed by the UAE and Kuwait.
"This upsurge in the value of contracts reflects the vibrancy of the region's power sector where governments are looking to meet spiraling demand - between 7 to 8 per cent a year," explained Anita Mathews, group director - Industrial Portfolio at Informa Exhibitions, which organises the event.
Citing research by the multilateral development bank Apicorp, the report - 'GCC Power Market Report ' - says the GCC will require a spend of approximately $81 billion for generating capacity, transmission and distribution over the next five years with that investment likely to be prioritised despite any prevailing economic headwinds.
"While GCC governments have registered budget deficits and tightened expenditure due to fluctuating oil prices, power sector investments are expected to remain unaffected and given importance," says the report.
The massive surge in investment has piqued interest in MEE 2018, which will run at Dubai World Trade Centre (DWTC) from March 6-8, with Informa expanding the event to cater to shifting sector dynamics. The 2018 show will feature a new dedicated Energy Storage & Management Solutions sector, while Informa will also debut the thought-leading Global Smart Energy Summit (GSES) alongside the mega exhibition.
"We are experiencing strong demand for the show's 2018 edition with more than 1,000 companies from 66 countries already committed to exhibiting," said Mathews. "These will be supported by 24 dedicated country pavilions. This strong commitment appears to be a resounding vote of confidence in the sector and in the ongoing short and medium-term commitment of GCC governments to invest in this segment and seek alternative financing vehicles. This interest covers the entire value chain of products, systems and services, which has led us to create five specific sectors, each devoted to a critical area of the power eco-system."