Abstract
The new Kuwait Power Report from BMI forecasts that the country will by 2013
account for 3.82% of
Middle East and Africa (MEA) regional power
generation. BMI’s MEA power generation estimate for
2008 is 1,174
terawatt hours (TWh), representing an increase of 5.1% over the previous year.
We are
forecasting an increase in regional generation to 1,609TWh by 2013,
representing a rise of 44% between
2007 and the end of the period.
Thermal power generation in 2008 is estimated by BMI at 1,096TWh, accounting
for 93.4% of the total
electricity supplied in the region. Our forecast
for 2013 is 1,486TWh, implying 43% growth that reduces
slightly the market
share of thermal generation to 92.4% – thanks in part to environmental
concerns that
should be promoting renewables, hydro-electricity and
nuclear generation. Kuwait’s thermal generation in
2007 was 42TWh,
or 3.98% of the regional total. By 2013, the country is expected to account
for 4.14%
of thermal generation.
For Kuwait, oil was in 2007 the
dominant fuel, accounting for 55.3% of primary energy demand (PED),
followed by gas at 44.7%. Regional energy demand is forecast to reach 902mn
tonnes of oil equivalent
(toe) by 2013, representing 31.76% growth over
the period since 2007. Kuwait’s 2007 market share of
3.70% is set to
climb to 5.03% by 2013.
Kuwait is now ranked last, behind even Algeria, in
BMI’s updated Power Business Environment rating,
thanks largely to
its modest market size, state control of the power sector and particularly low
proportion
of renewables use. The power sector is not competitive, with no
appreciable progress towards
privatisation. The regulatory environment is
unattractive. Kuwait has slipped just one point behind
Algeria, so is
likely to continue jockeying for position with the North African state over
the next several
quarters.
BMI is now forecasting real GDP growth
averaging 5.13% per annum between 2007 and 2013, with the
2008 estimate
being 7.20%. Population is expected to expand from 3.40mn to 3.88mn over the
period,
with GDP per capita forecast to rise by 29% and power consumption
per capita expected to increase by
27% from an already high base. The
country’s power consumption is expected to increase from an
estimated 45.2TWh in 2007 to 65.3TWh by the end of the forecast period,
resulting in a broadly balanced
market that, at times of peak demand, will
struggle to provide adequate supply without imports –
assuming 6.3%
annual growth in electricity generation.
Between 2007 and 2018, we are
forecasting an increase in Kuwaiti electricity generation of 100.1%,
which
is almost mid-range for the MEA region. This equates to 35.1% in the 2013-2018
period, down
from 48.1% in 2007-2013. PED growth is set to decrease from
78.6% in 2007-2013 to 46.9%,
representing 162.5% for the entire forecast
period. Thermal power generation is forecast to rise by
100.1% between
2007 and 2018. More details of the longer-term BMI power forecasts can be
found in
the Appendix of this report.
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