(MENAFN - Arab News) Like most countries in the Gulf region, Saudi Arabia is developing extremely fast. The population and the infrastructure are growing at a very high rate. Analysts estimate that power requirements will continue to grow by 7-8 percent each year, according to Dr. Michael Suess, CEO Siemens Energy Sector.
"We are covering the entire energy spectrum in the Kingdom from generation, transmission to distribution. Together with our partners, E. A. Juffali & Brothers, we will continue to invest in developing local manufacturing facilities in the Kingdom," Suess told Arab News in an exclusive interview.
"Our manufacturing facility in Dammam for turbines will be operational by the end of 2014," said the CEO.
"We have recently expanded our Low and Medium Voltage (LMV) manufacturing facility in Jeddah. Our service facility for generators and turbines has been in operation for more than 30 years and we are expanding it to new technologies," he said.
Siemens highlighted the Kingdom's future challenges in a recent study. Saudi Arabia's power demand is set to more than double by 2030. About half of today's power is being generated in oil-fired power plants, the rest in gas power plants. If this power mix were to remain unchanged, the country would have to import crude within just three decades, as it would no longer be able to produce enough oil for its own consumption.
To counter this long-term trend, Saudi Arabia is pushing to exploit renewable energy sources on a larger scale and is building more gas power plants, he said on the eve of Saudi Water & Power Forum (SWPF)in Jeddah.
SWPF has evolved to provide the energy community a platform to meet with the government organizations as well as local and international companies, he said, adding that Siemens has been the sponsor for this event for the last 7 years, early from the beginning.
"It is an opportunity for Siemens to showcase the latest trends in the energy sector, especially its extraordinary achievements in energy efficiency. One highlight is our H class gas turbine. With this innovative technology, we achieved the world record in efficiency of more than 60 percent in combined cycle operations," Suess said.
Siemens Energy is committed to provide answers to key challenges in order to ensure the sustainable future of the power and water sectors in the Kingdom. "The topics of the SWPF Exhibition match perfectly with our portfolio, for example, highly efficient combined cycle power plants or wind turbine solutions for the extreme temperature in the Kingdom, in addition to power transmission and smart grid solutions," he added.
Saudi Arabia's energy demand has been growing at around 7 percent per year which, Suess said, will gradually erode the exportable oil surplus. Oil is more valuable for export than for power generation. To date 10 percent of Saudi oil production is 'wasted' for power generation. Efficient utilization of fossil fuel is the key requirement of the energy sector in Saudi Arabia. "Siemens offers highly efficient combined cycle power plants with a record efficiency of over 60 percent. We continue to invest in our technologies in order to provide cutting edge solutions to our customers in the Kingdom," Suess said.
In order to address the rising demand for power generation and preserve oil reserves for economically lucrative export, one challenge is to diversify the Kingdom's power generation mix. Most of the power is currently produced by inefficient oil-fired power plants. Various Saudi institutions like the scientific think tank K.A.CARE have introduced plans aimed at increasing the share of non-fossil power generation plants within this decade. For example, the integration of wind power will help to further reduce oil and gas consumption and secure long-term power generation. With an amortization time of 4-6 years, onshore wind is quite an interesting option (solar Photovoltaic large scale: 8-10 years), he added.
One of today's biggest challenges is to meet soaring worldwide power demand without compromising the reliability, efficiency, and environmental compatibility of the increasingly complex energy system. The Power Matrix represents Siemens' unparalleled understanding of the global power landscape a perspective that enables trendsetting solutions paving the way to the future of energy. Highly efficient combined cycle power plants and the associated service are part of Siemens' environmental portfolio. "Around 43 percent of its total revenue stems from green products and solutions. That makes Siemens one of the world's major providers of eco-friendly technology. We will continue to invest in developing local manufacturing facilities in the Kingdom," he said.
Asked about Siemens' prospective contribution to Riyadh Metro project and how he saw the public transportation future in the Kingdom, he said: "The public transportation has a huge potential in the Kingdom considering the fact that hardly 4 percent of the population use the public transport in the major cities. Riyadh metro will not only help in conserving the energy but also improve the traffic congestion. Siemens has signed contracts for the main metro lines in Riyadh, providing trains, complete signaling, and electrification and communications equipment."
Listing Saudi Arabia's greatest challenges in terms of sustainability, Suess said he was positive about overcoming them.
"Saudi Arabia presents many challenges and opportunities with regard to sustainability," said the CEO.
"The country is undergoing a period of rapid population and industrial growth, both of which bring sustainability challenges, and there is also increasing pressure for the more efficient management of the country's resources. Technology exists and is always being improved to both assist with these issues and mitigate their effects, and this also raises the need for exemplary education," said Suess.
"A growing population requiring more and more advanced technology needs a skilled and localized work force, and this is an opportunity for companies like Siemens to build on long-established relationships by contributing to the development," he said.
Asked what should be done to ensure that future power needs of the Kingdom are met without increasing the pressure on natural resources and the environment further, Suess said: "One answer is that we need to improve energy efficiency. Boosting efficiencies in existing infrastructure such as power plants as well as industrial plants and even buildings can go a long way toward reducing the impact of energy use on the environment and saving natural resources."
He added: "Whether we are confronting the challenges of climate change or the problems posed by the growing scarcity of commodities such as carbon fuels, metals and technologies that boost efficiency have never been as important as they are today," Suess said. "Enhanced efficiency saves not only raw materials and energy but also loads of money. Siemens has developed and implemented some of the most innovative technologies to take energy efficiency to a new level, putting the company into a unique position to tackle some of today's most pressing questions."