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Saudi Energy Minister Prince Abdulaziz bin Salman said today, Nov. 16, the reform and restructuring of the local electricity sector will help achieve future goals.
Addressing a press conference on the latest structural and financial reforms in the power sector, the minister said the Electricity & Cogeneration Regulatory Authority (ECRA) will work with other competent authorities to track the performance indicators and efficiency targets, to regularly improve the quality of services in line with the international best practices.
The reforms will contribute to enhancing the efficiency and sustainability of the Kingdom’s electricity sector, he said, adding that they will also boost the sector’s performance through increasing the power generation efficiency, reducing the use of liquid fuel, enhancing environmental compliance and boosting the power transmission network’s reliability.
The ministerial restructuring committee will monitor the implementation of priority projects in the sector and complete the sector restructuring.
Accordingly, Saudi Arabia will be able to produce power from renewable energy resources to achieve the targets that include optimum energy mix, improved distribution networks and better service quality, Prince Abdulaziz added.
The Saudi government will pay Saudi Electricity Co.’s (SEC) dues to increase its financial and operating sustainability.
The government authorities will also adhere, through an agreed mechanism, to pay SEC dues under estimated budgets, sufficient to cover their annual electricity invoices.
Moreover, a corrective mechanism will be used to monitor this budget, which will be used until the first quarter of the following the fiscal year.
The utility provider’s revenues will be regulated under a new mechanism that will help it operate efficiently to redeem service costs and realize a balanced return on investment costs at 6%, in line with other power sectors worldwide.
The reforms witnessed in the electricity sector are part of the Kingdom’s development, the Saudi minister added.
SEC said today that new financial and regulatory reforms in the electricity sector, including the reclassification of its financial government liabilities, were approved.
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