Did you know, despite its limited natural water resources, the United Arab Emirates (UAE) has one of the highest water consumption rates per capita in the world?
As a thriving economy in the Middle East, the UAE’s fast-paced urbanization and population growth has fueled an unprecedented demand for sustainable and cost-efficient portable water generation – a challenge to which technology and financing may offer some fresh thinking.
Energy as part of the water equation
Most of the portable water across the Emirates comes from desalinated seawater . This underpins the critical role of desalination plants in safeguarding water supply – a key United Nations Sustainable Development Goal that is even more relevant to the country in times of climate change.
Currently, the World Resources Institute ranks the UAE at 10th out of 164 in a global league of countries where water supplies are most stretched . Alleviating this resource stress would require not only new water generation infrastructure, but also a considerable volume of energy needed to power them.
Forward-looking technologies therefore sit at the core of the region’s long-term water strategy: desalination facilities that can increase water production – while being more energy-efficient and environmental-friendly at the same time.
Financing the world’s largest reverse osmosis desalination plant
In Abu Dhabi, modern technology and project financing are instrumental to make real what is soon to be the world’s largest desalination plant using seawater reverse osmosis technology – a water purification process that is less energy-intensive than traditional thermal desalination operations.
The Taweelah desalination plant, set to be completed in 2022, will supply 909,200 cubic meters per day (m3/day) of water, 44% more than the world’s current largest reverse osmosis plant of 624,000 (m3/day), meeting the water needs of 350,000 households.
Setting new benchmarks for its size and cost-efficiency, Taweelah is a light-house project enabled in a public-private partnership (PPP). The tender to build, own and operate the facility for 30 years was won by ACWA Power, the Saudi-based developer, investor and operator of power generation and desalinated water plants.
While Siemens contributes as a sub-supplier of digital industry and smart infrastructure technologies, the majority of the financing behind the $869-million project was enabled by senior project finance loans from a club of six lenders, in which Siemens Bank, the banking subsidiary of Siemens Financial Services (SFS), took a significant share and acted as the Mandated Lead Arranger (MLA).
As in many cases around the world, Siemens helps realize large-scale infrastructure by providing technology and financing from the same source. “The SFS participation in the debt finance motivated ACWA Power to facilitate an early and close engagement between the EPC Joint Venture partners and Siemens,” Marcus Oates, Head of Vertical Sales of Digital Industry, Process Automation, Siemens UAE, comments.
Accelerating water transition in the Middle East
As the first desalination plant to be built independent of a power plant in Abu Dhabi , Taweelah will help support the UAE’s vision in lowering carbon dioxide emissions, while reducing gas consumption by decoupling power and water production for the winter and summer seasons.
Water desalination infrastructure is essential to the long-term sustainable development across the Middle East, but they are also capital-intensive projects. For Taweelah, Siemens Financial Services (SFS) is proud to have facilitated the state-of-the-art project utilizing technology from Siemens. Providing tailored project financing and technology as a holistic solution is a combination unique in the market and vital to enabling critical infrastructure.Siobhan Smyth, CEO of Project and Structured Debt Europe/Asia, Siemens Financial Services
Looking into the future, the combined effects of population and prosperity are projected to triple the water demand in the Middle East in the next few decades . To sustainably cope with such needs, the impact of smart technology, and the financing solutions tailored to invest in them early, will remain essential for the rapidly developing region.