Today, His Royal Highness Prince Abdulaziz bin Salman bin Abdulaziz, Minister of Energy, held a press conference on the issuance of the royal order regarding organizational, structural and financial reforms in the electricity sector.
His Highness the Minister of Energy said at the conference, in which His Excellency the Chairman of the Committee in the Ministry of Finance, Mr. Abdulaziz Al-Fraih, His Excellency the Governor of the Electricity and Cogeneration Regulatory Authority, Dr. Abdul Rahman Al Ibrahim, and His Excellency the Chairman of the Board of Directors of the Saudi Electricity Company, Dr. Khaled Al-Sultan, participated in these structural, organizational and financial reforms. The royal decree approving it, which we will talk about today, are clear and deliberate steps towards enhancing the efficiency, effectiveness and sustainability of the electricity sector in the Kingdom.
His Highness indicated that these reforms reflect the transformation that the Kingdom is witnessing, in all fields, after four years of the launch of the Kingdom's Vision 2030, under the guidance and leadership of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud, and under the direct supervision and follow-up of His Royal Highness Prince Mohammed bin Salman bin Abdulaziz, Crown Prince, Deputy Prime Minister and Minister of Defense - may God protect them -, as the Kingdom moved from the stage of drawing up plans and establishment, to the stage of practical application and implementation in many areas. His Highness the Minister of Energy said: "There is no doubt that the numbers and information that the His Highness the Crown Prince reported on what has been achieved, in his recent speech, confirming that the Kingdom is firmly on the path of realizing the hopes and aspirations of its leadership and people.
His Highness Prince Abdulaziz bin Salman indicated that the reforms taking place in the electricity sector came as part of this development process, and would not have been achieved without God’s success, then the presence of the will for change in the government of the Custodian of the Two Holy Mosques, and the follow-up, supervision and support of the Higher Committee for Energy Mix Affairs for Production Electricity and the empowerment of the renewable energy sector, headed by His Highness the Crown Prince, which oversees all the work of the Ministerial Committee for the Restructuring of the Electricity Sector.
His Highness affirmed that what was announced today will contribute - God willing - to achieving sustainability and raising the efficiency of the electricity sector in the Kingdom, and it will be positively reflected on its performance, which will enable to raise the generation efficiency of stations, reduce the use of liquid fuels, raise the level of environmental commitment, and enhance the reliability of the electricity transmission network. To enable the production of electricity from renewable energy sources, with the aim of achieving the objectives of the optimal energy mix for electricity production, and improving distribution networks and converting them into smart and digital networks, to enhance the reliability of the service provided to the consumer.
His Highness the Minister of Energy explained that the approved reforms include canceling the government fee imposed on the Saudi Electricity Company, and treating the net government dues on the Saudi Electricity Company, which are recorded in its approved financial statements, by converting it into a financial instrument classified as shareholders’ equity with a return of 4.5%, The government is committed to regularly paying the company's dues, which contributes to enhancing the financial and operational sustainability of the company.
His Highness said that the revenues of the Saudi Electricity Company will be organized according to a new mechanism that will enable it to work efficiently, to recover the costs involved in providing the service, and to achieve a balanced return on the investment cost (WACC) of 6%. On the aspects of activity organized by the Electricity and Cogeneration Regulatory Authority, so that the difference between the required revenue and the income realized from the approved tariff is covered, through the budget account, in return for the company’s commitment to the procedures aimed at raising the quality of service provided to the consumer.
His Highness indicated that the Ministerial Committee for Restructuring will follow up the implementation of the sector's investments in priority projects, and the completion of restructuring the sector, under the supervision of the Higher Committee for Energy Mix Affairs to produce electricity and enable the renewable energy sector.
For its part, the Electricity and Cogeneration Regulatory Authority, in coordination with the relevant authorities, will periodically follow up performance indicators for efficiency objectives and service improvement, through an approach that is consistent with international best practices.
On this occasion, His Highness said: I extend my deep thanks and gratitude to the Custodian of the Two Holy Mosques; King Salman bin Abdulaziz Al Saud, and His Highness the Crown Prince - may God protect them - for the support that the electricity sector and the energy sector in general in the Kingdom receive.
His Highness expressed his thanks and appreciation to the two members of the Ministerial Committee for the Restructuring of the Electricity Sector, which he was assigned to chair, namely, His Excellency the Minister of Finance, Minister of Economy and Planning in charge, Chairman of the Board of Directors of the National Center for Privatization, Mr. Muhammad bin Abdullah Al-Jadaan, and His Excellency the Governor of the Public Investment Fund, Mr. Yasser bin Othman Al-Rumayyan. .
His Highness also expressed his thanks to the workers in the electricity sector integration system teams, who represent many parties, who worked in an integrated manner to coordinate efforts, between the concerned government agencies, to support the work of the Ministerial Committee for Restructuring
