RIYADH, 12 November — Saudi Arabia’s Supreme Economic Council yesterday approved the establishment of an authority to regulate electricity services in the Kingdom, another major step toward restructuring the country’s power sector.
A SEC meeting, chaired by Crown Prince Abdullah, deputy premier and commander of the National Guard, also decided to impose a higher customs tariff of 12 percent on 176 foreign products to protect national industries.
Dr. Abdul Rahman Al-Tuwaijeri, secretary-general of the SEC, said the meeting approved the rules and regulations of the Authority for Industrial Cities and Technological Regions.
The new electricity authority will “regulate in the interest of consumers, operators and investors”, in a sector that has been undergoing restructuring since the formation of the Saudi Electricity Company (SEC) last year.
Industry and Electricity Minister Hashem Yamani said last week that the formation of a regulator would complete the restructuring of the power sector in the Kingdom.He estimated that the power sector would require investments of more than $90 billion until the year 2023, with $26 billion in the next five years.
The decision is also expected to attract more foreign investment into the power generation sector, and then into the transmission field. Yamani said the electricity company was ready to negotiate with local and foreign investors about joint power projects in which they would build new stations or participate in the rehabilitation of old plants.
In October last year, the Kingdom doubled the average electricity tariff rates for residents. The SEC is planning to impose a new special tariff for peak hours, especially during summer.
