Abstract
The new Kuwait Power Report from BMI forecasts that by 2013 the country will
account for 4.20% of
Middle East and Africa (MEA) regional power
generation. BMI’s MEA power generation estimate for
2008 is 1,200
terawatt hours (TWh), representing an increase of 6.1% over the previous year.
We are
forecasting an increase in regional generation to 1,566TWh by 2013,
representing a rise of 30.5%
between 2008 and the end of the period.
MEA thermal power generation in 2008 is estimated by BMI at 1,135TWh,
accounting for 94.6% of the
total electricity supplied in the region. Our
forecast for 2013 is 1,460TWh, implying 38.3% growth that
reduces slightly
the market share of thermal generation to 93.2% – thanks in part to
environmental
concerns that should be promoting renewables,
hydro-electricity and nuclear generation. Kuwait’s
thermal
generation in 2008 was an estimated 52TWh, or 4.59% of the regional total. By
2013, the country
is expected to account for 4.50% of thermal
generation.
For Kuwait, in 2008 oil was the dominant fuel, accounting for
57.0% of primary energy demand (PED),
followed by gas at 43.0%. Regional
energy demand is forecast to reach 871.0mn tonnes of oil equivalent
(toe)
by 2013, representing 18.5% growth over the period since 2008. Kuwait’s
2008 market share of
3.64% is set to climb to 4.12% by 2013.
Kuwait
now shares last place with Algeria in BMI’s updated Power Business
Environment rating, thanks
largely to its modest market size, state
control of the power sector and a particularly low proportion of
renewables use. The power sector is not competitive, with no appreciable
progress towards privatisation.
The regulatory environment is
unattractive. Kuwait is 12 points behind Iran, so is unlikely to challenge
the larger Gulf state over the next few quarters.
BMI is now forecasting
real GDP growth averaging 2.83% per annum between 2008 and 2013, with the
2009 estimate being a decline of 1.00%. Population is expected to expand from
3.31mn to 3.40mn over
the period, with GDP per capita forecast to rise by
9% and power consumption per capita expected to
increase by 14% from an
already high base. The country’s power consumption is expected to
increase
from an estimated 45.3TWh in 2008 to 53.1TWh 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 4.9% annual growth in electricity generation.
Between
2008 and 2018 we are forecasting an increase in Kuwaiti electricity generation
of 63.5%, which
is among the highest in the MEA region. This equates to
29.5% in the 2013-2018 period, up from 26.3%
in 2008-2013. PED growth is
set to icrnease from 33.8% in 2008-2013 to 36.4%, representing 82.4% for
the entire forecast period. Thermal power generation is forecast to rise 63.5%
between 2008 and 2018.
More details of the longer-term BMI power forecasts
can be found at the end of this report.
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