UAE boosts water capacity

UAE boosts water capacity
Jebel Ali Power Plant and Water Desalination complex _ UMEDubai United Arab Emirates April 29 2019 Photo by Mohammad Adel RashidITP Images
Published: 2 January 2020 - 7:29 p.m.
By: Baset Asaba

The Middle East remains one of the most water-stressed regions in the world where seawater desalination contributes more than 90% of all daily water requirements.

But high demand for water continues to put pressure on the existing supply capacity as the population increases along with the growing industrialisation levels, prompting government utilities to step up their investments in new water desalination capacities.

In October, Emirates Water and Electricity Company, EWEC, a subsidiary of Abu Dhabi Power Corporation, and ACWA Power, the Saudi-based developer, investor and operator of power generation and desalinated water plants, confirmed the successful financial closing of the world’s largest reverse osmosis desalination plant.

The new plant will be located at the Taweelah power and water desalination complex in Abu Dhabi, with completion expected in 2022. A partnership of Abu Dhabi Power Corporation and Mubadala Investment Company holds a 60 percent equity interest in the Taweelah project with the remaining 40 percent held by ACWA Power.

The project is to cost Dh3.19bn, with funding sourced from a combination of senior project finance loans worth a total of Dh2.71bn, in addition to equity contributions from shareholders and operating cash flow from pre-operations.

The Taweelah plant’s loan structure is a "Soft Mini Perm", with an expected refinancing period of a maximum three years starting after the commencement of the Taweelah project’s commercial operations.

Loans (including conventional and Islamic tranches) have been arranged by a group of local and international banks including Emirates NBD, Natixis, Mizuho Bank, Siemens Bank, Bank Boubyan and The Norinchukin Bank. Natixis is the Agent Bank.

This plant redefines efficiency benchmarks with record low energy consumption of less than 3kWh per cubic meter. The contribution from around 50 MW of onsite solar generation will further boost the plants green credentials.

Othman Al Ali, CEO of EWEC says that the reverse osmosis desalination plant will support the UAE’s vision in reducing carbon dioxide emissions, while significantly reducing gas consumption by decoupling power and water production for the winter and summer seasons.

“This initiative will help us meet future water demand for the UAE. The choice of Reverse Osmosis sea water desalination technology will play a critical part in significantly reducing water production costs, contributing to our goals to build a more sustainable and efficient water and energy sector in the UAE. The project will also help save material fuel costs across the sector, given the flexibility that the technology provides,” says Al Ali.

The Taweelah plant will set new benchmarks for its size, efficiency and cost of water produced. Supplying 909,200 m3/day, it will be 44 percent larger than the world’s current largest reverse osmosis plant of 624,000 m3/day.

The desalination facility is sufficient to meet the water demand for over 350,000 households. A major driver for the adoption of reverse osmosis instead of thermal desalination is the higher energy efficiency it offers.

The deal will enable the development of over 900,000 cubic meters per day desalination facility in Taweelah – sufficient to meet the demand of water for over 350,000 households. Approximately 45 KM north of Abu Dhabi city, the project will use reverse osmosis technology to desalinate seawater and will be one of the largest, most cost and energy efficient plants in the world.

The plant will be 44% larger than the world’s current largest reverse osmosis plant of 624,000m3/day. A major driver for the adoption of reverse osmosis instead of thermal desalination is the higher energy efficiency it offers.

The plant will be developed on a build, own and operate basis with the engineering, procurement, and construction contract for the water plant undertaken by a joint venture of ABENGOA and PowerChina. ACWA Power owns a 40 percent stake in the project company formed “Independent Water Producers” to be responsible for the RO Plant.

The remaining 60 percent stake is owned by Mubadala Investments Company and Abu Dhabi Power Corporation. Once the project is complete, EWEC will be the off-taker for the water output produced by the project over a 30-year period. The plant is scheduled to commence full commercial operations in Q4 2022.

“Through the Taweelah RO plant project and the enabling environment provided by Abu Dhabi, we are proud to be setting new global bench marks in both the cost of desalinated water and the energy consumed in producing that water,” says Paddy Padmanathan, President and CEO of ACWA Power.

Outside Abu Dhabi, new projects are springing up to help ramp up the UAE’s overall desalination capacity.

Last month, a consortium consisting of ACWA Power and MDC Power Holding Company LLC, an entity fully owned by Mubadala Investment Company PJSC (Mubadala) along with the Federal Electricity & Water Authority (FEWA) achieved the financial closure for the 150 MIGD Umm Al Quwain Independent Water Project (IWP) in the UAE.

The $800 million project is funded on a debt to equity ratio of up to 85/15. A syndicate of seven international and local lenders will provide the $680 million senior debt.

The mandated lead entities including Korea Development Bank, MUFG Bank, Siemens Bank, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation, First Abu Dhabi Bank and Samba Financial Group helped structure the first IWP non-recourse project finance debt for FEWA on a 24.5-year door-to-door tenor.

The UAQ IWP is an Independent Water Project (IWP) based on Reverse Osmosis Technology. The plant along with the associated Intake & Outfall facilities shall be developed to produce 150 MIGD (682,000 m³/day) of desalinated water and will be located at a coastal site in the Emirate of Umm Al Quwain along the border of Emirate of Ras Al Khaimah.

The Water Purchase Agreement (WPA) with off-taker, Federal Electricity and Water Authority (FEWA), is signed for a 35-year term, and the plant is expected to be commercially operational by July 2022.

Also last month, Dubai Electricity and Water Authority (DEWA) issued a Request for Proposal (RFP) to nine qualified bidders for a 120 Million Gallons Per Day (MIGD) Sea Water Reverse Osmosis (SWRO) Plant. This is the first water desalination project that DEWA has undertaken that uses the Independent Water Producer (IWP) model.

DEWA has adopted IWP for the Hassyan desalination plant, following the success of the Independent Power Producer (IPP) model at the Mohammed bin Rashid Al Maktoum Solar Park projects. The SWRO project is expected to start operations in 2023.

The SWRO desalination plant will use the most efficient, proven and reliable state-of-the art technology. The plant will provide a sustainable supply for DEWA’s water network.

“The project is part of DEWA’s strategy to increase the water desalination capacity in Dubai to 750 MIGD, from 470 MIGD. DEWA is currently desalinating water through the joint production of electricity and water, using efficient MSF distillation technology, which depends on waste heat created by the production of electricity for water desalination,” says Saeed Mohammed Al Tayer, MD & CEO of DEWA.

“DEWA also uses RO to desalinate water, a proven technology that is also used around the world, which is ideal for the large production capacity from clean energy.”

To date, DEWA has received 34 Request for Qualification (RFQ) documents for a 120 MIGD SWRO IWP project. Subsequently, DEWA evaluated them and shortlisted nine pre-qualified bidders to submit their proposals. The closing date to submit the bids is 31 January 2020.

In April, DEWA inaugurated the extension project of M-Station in Jebel Ali, the largest power and water desalination plant in the UAE.

With the construction of the extension, the total cost of M-Station reached Dh11.669 billion while its production capacity reached 2,885 megawatts (MW) and 140 million gallons of desalinated water per day. Built according to the highest standards of availability, reliability, efficiency and quality, the Dh1.527bn extension project added new generating units with a capacity of 700MW.

"The extension to the M-Station supports the UAE's strategy to adopt innovation and shape the future,” says Al Tayer.

Before the extension, M-Station generated 2,185MW of electricity from six Siemens F-model gas turbines, each with a capacity of 255MW, six Doosan Waste-Heat Recovery Boilers for steam generation, three Alstom steam turbines with a capacity of 218MW each. The project also included construction of 16 fuel-oil storage tanks, each with a capacity of 20,000 cubic metres and totalling 320,000 cubic metres of fuel-oil storage.

The station produces 140 MIGD from eight Fisia desalination units, deploying Multi-Stage Flash (MSF) distillation technology, each with a capacity of 17.5 MIGD and two dual-fuel-fired auxiliary boilers.

The extension project added a total of 700MW of electricity to the M-Station. It includes two dual-fuel gas turbine generators each with a capacity of 263.5 MW, two Waste Heat-Recovery Boilers for steam generation and a back pressure steam turbine from Siemens with capacity of 173MW.

The extension's design has a 90 per cent fuel efficiency, which has increased the plant's overall fuel efficiency from 82.4 per cent to 85.8 per cent, which is one of the highest fuel efficiency rates in the world. The extenstion project has increased M-station's total capacity to 2,885MW.

DEWA has continued to work towards building a robust infrastructure to enhance its total production capacity, which is currently 11,100MW of electricity and 470 MIGD of water production.

The UAE continues to achieve world-class results and set new global standards, breaking world records in energy and water performance indicators, including energy efficiency indicators and electricity cost per kilowatt-hour.

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