Published on IDRA Global Connections Summer 2021 Issue

• Interview with H.E. Eng. Abdullah Bin Ibrahim Al-Abdulkareem Governor of Saline Water Conversion Corporation [SWCC]

After the recent launch of SWPC’s PPP plan, the market is very excited about the asset privatization plan from SWCC. Can you explain the next steps, proposed schedule, level of investment required and the overall scope of projects to be launched under the privatization plan?

Over the past several years, the SWCC privatization team has been working under the oversight of the Supervisory Committee for Privatization in the Water Sector to: finalize the program structure; secure the needed approvals across all related authorities; and as the program is implemented successfully, to transfer the ownership of the existing SWCC water transmission assets under a new national transmission company –TRANSCO – which asset transfer is targeted to be implemented in phases to secure seamless transition to the new asset management structure.

On a deferent path, the Program intends to sequentially divest ownership stakes in all privatization-ready production assets of SWCC to a well-qualified, privatesector consortia – the first project to be offered for privatization is the Ras Al Khair desalination and power generation plant.
The privatization program is based on a flexible PPP model and its implementation is subject to appropriate market conditions. The level of investment required will depend on the production capacity of the particular assets and some of the assets may be bundled with percentage of ownership by the private sector to be determined individually for each bundle.

Since this program does not require the construction of water and energy plants, but focuses exclusively on investment and operation of existing facilities, how has the privatization plan been received by the international community given the return on investment KSA is offering? What is the profile, according to your criteria, of the companies that would be interested in the plan, given that we are normally used to having construction companies in this business?

The Privatization Program has been received very positively by regional & international investors, including both strategic players active in the water & power sectors as well as large institutional investors with an interest in infrastructure asset acquisition and investment in Saudi Arabia. The envisioned asset ownership structure is aligned with that of IWPs and IWPPs. Given that one of the main privatization objectives of the Kingdom is to improve the operational efficiency of water production and power generation assets, potential investors have to strongly demonstrate the ability of their team to operate & maintain similar plants, along with financial capacity of the investors to complete such transactions. Strategic and financial investors are expected to form consortia that can collectively satisfy technical and financial criteria to
acquire and operate SWCC’s plants. The specific eligibility criteria for the potential privatization consortia will be announced in the project tendering packages.

What scope is being given to the program for revamping or improvements of the facilities? Within the plan, there are both modernized plants and older ones, how does the program propose potential improvements to ensure better energy and technical performance, for example changing out thermal processes for RO where possible?

Our strategy is to slowly phase out and retire thermal desalination plants as they reach the end of their useful life. At the same time, we are planning to replace the retired thermal plant assets with stateof-the-art reverse osmosis desalination facilities to benefit from the energy and
capital cost advantages offered by the latest technology advancements. In alignment with our privatization strategy we are working to assure that all of the production bundles are economically and environmentally sound to attract investors and to encourage their investment in asset
enhancements that result in cost effective operations and reasonable return on investment. Furthermore, the most viable set of asset enhancements will vary from project to project depending upon the nature, technology and age of each of the assets included in the bundle – SWCC and private investors share a common goal to optimize the asset structure and capacity from both operational and financial perspectives.

Once privatized, how will SWCC ensure the plants are run at optimum capacity and SWCC standards? What is the plan for staff transferring from the public to private sector?

Our approach to harnessing the benefits offered by the private sector combines the best-of-two worlds – low-cost public capital and high-efficiency with a highly reliable operation and oversight structure. The privatization process will be combined with a strong governance model which assures protection of public safety, reliable water supply and market-driven competitive water tariff structure which will be imbedded in a
well-defined contractual framework tailor made for the respective bundles, taking into account the individual characteristics of each asset / bundle. Private investors would be incentivized contractually to achieve operational efficiencies and meet or exceed performance targets in terms of water quality, quantity, price and use of consumables.

One of the benefits that SWCC will offer to the private sector is assurance that the service continuity is maintained by transitioning existing well trained and capable employees of SWCC to the private sector for each production bundle within the process of PPP to assure seamless integration of existing work force in the new project ownership structure in accordance with applicable KSA Government regulations covering this topic and promoting fair treatment of employees.

What are SWCC future plans to achieve synergies with renewable energies that will contribute to having a more sustainable infrastructure network with less CO2 emissions?

In parallel with the exploration of renewable power alternatives, the SWCC research institute – DTRI – is working on the development of new generation of energy recovery devices, high pressure pumps, and membranes which aim to bring the total energy use of desalination plants to less than 2.45 kWh/m3 and the energy demand of the reverse osmosis desalination system below 1.8 kWh/m3. These advancements will result in the reduction of the total energy use and carbon footprint of desalination plants with over 30%. The new technologies are tailored to fit equally well in both existing desalination plants and future reverse osmosis facilities.

The new energy recovery device we are developing at present is designed to reuse over 98.5% of the energy remaining in the brine after membrane separation. Such energy recovery efficiency will exceed significantly the performance of the commercially available best-in-class energy recovery technologies and will address some of the flaws of these technologies such as brine mixing and equipment complexity. Our team of researchers is also working on a disruptive improvement of the efficiency of the high-pressure pumps used for reverse osmosis desalination. Currently these pumps have efficiency between 75 and 83%. The new pump technology we are developing in cooperation with leading pump designers and manufacturers is targeting efficiency of 95% or more. Taking into consideration that high pressure pumps
consume between 70 and 75% of the total energy in desalination plants, this dramatic improvement of pump efficiency will yield to an unprecedented reduction in desalination plant carbon footprint.

In close cooperation with the University of California Los Angeles, we are developing a new generation of reverse osmosis membranes that will combine high rejection of salts and seawater impurities with extremely low energy use. We plan to the have the 8-inch membrane prototypes
tested in full scale conditions this year and to begin construction of a membrane production facility in the Kingdom in 2021.

Mining of high-value minerals from the seawater brine is a cornerstone of our future research and desalination project development. Over the past two years we have developed and tested an advanced membrane-based brine concentration technology which is capable of producing
high-purity sodium chloride brine that can be used as a brine source by the chloralkali industry. This technology is evolving into zero liquid discharge (ZLD) system that would allow to extract not only sodium chloride from the brine but also other high-value minerals such as magnesium, bromide, rubidium, and lithium. One of the key distinctive features of our new brine mining technology is that it operates at
total energy use that is less than 50% lower than the most advanced ZLD technologies commercially available on the market at present. Our vision is to harness the value contained in seawater brine and use it to subsidize the production of desalinated water, thereby bringing this water cost down to zero and transforming desalination into the lowest cost fresh water production technology in the world.”

Can you share with the IDRA community how the Saudi Water Academy within its training program is aimed to provide a strong new cadre of RO plant operators and technicians?

In general, our ambition for the Saudi Water Academy, is to address the training needs in the desalination market for the RO process, the predominant technology being used globally. SWA has developed a new, robust immersive and interactive training program for RO operators based on our extensive depth of knowledge as a world leader in this technology. However, this represents only a part of the total transition that is happening within the Academy. We are actively expanding our overall program to cover new areas that will create an inclusive program
for the complete water professional. This is being accomplished through a significant transformation to become a commercial global water academy that enhances and contributes to the water industry worldwide by offering high-quality programs, worldclass instructional design, and a blended mode of delivery using enabling and immersive technologies.

The ambitious vision of the Saudi Water Academy aligns with human capabilities development objectives that are inspired by the vision 2030, positioned to positively contribute to the holistic development of talent in the water sector and related industries in the Kingdom and beyond.