Overview

The development of Saudi Arabia’s water sector will play a key role in ensuring that it can meet the increasing demand for potable water and wastewater infrastructure.  Economic development, continuous population growth, rapid urbanization, and increasing demand for water and energy pose a huge environmental challenge for the country.  The Saudi Arabian Government’s 2022 budget line item for the water sector, which falls under “Economic Resources,” is $14.4 billion, a 34.4 percent decrease from 2021. However, this reduction in funding does not signal a shift in government priorities vis-à-vis water but, rather, it aligns with the government’s objectives for increasing the private sector’s contribution to this sector.

Between 2022 and 2030, the population of Saudi Arabia is expected to grow from 34.8 million to over 40 million.  The country has relied on desalinated water since the 1950s to ensure that the population has access to a reliable source of potable water. Most groundwater, which comprises less than 40 percent of the country’s water resources, is used for agricultural purposes.  The population growth rate is projected to have a significant impact on wastewater generation, leading to a 50 percent increase in wastewater generation from a 2018 baseline volume of 7.2 million m3/day.

The strategic objectives of Saudi Arabia’s National Water Strategy are to ensure continuous access to adequate quantities of safe water under normal operations and during emergency situations; enhance water demand management across all uses; deliver cost-effective and high-quality water and wastewater services; safeguard and optimize the use of water resources and preserve the local environment for the highest benefit of the Saudi society; and ensure water sector competitiveness through the promotion of effective governance, private sector participation, localization of capabilities, and innovation.

Key Players in the Saudi Arabia Water Sector

• Ministry of Environment, Water, & Agriculture (MEWA): MEWA is responsible for the regulation and implementation of all aspects of the country’s policies for the environmental, water and agricultural sectors. 

• Water & Electricity Regulatory Authority (WERA):  WERA regulates the electricity and water desalination sector as well as district cooling. 

• Saline Water Conversion Corporation

• SWCC):  SWCC is a government-run organization responsible for approximately 69 percent of desalination in Saudi Arabia and 20 percent of worldwide desalination. 
• National Water Company (NWC): NWC is a Saudi joint-stock company fully owned by the Public Investment Fund and was established to provide water and wastewater treatment services in accordance with the latest international standards.

• Saudi Water Partnership Company (SWPC): SWPC is fully owned by the Ministry of Finance and charged with overseeing the PPP development of desalination and wastewater projects.  SWPC is a purchasing agent of the SWCC and the Saudi Electricity Company. 

• Water Transmission and Technologies Company (WTTCO): Established by MEWA, WTTCO is responsible for operating and maintaining transmission, dispatch, distribution and storage systems and transmission of desalinated water. 

• Saudi Technology Development and Investment Company (TAQNIA):  TAQNIA is a 100 percent Public Investment-owned company mandated to invest and commercialize the R&D output from various research institutions locally and globally.

• National Center for Privatization and PPP (NCP):  NCP is a public center of excellence that aids in developing regulations, creating privatization frameworks, and preparing government assets and services for privatization.

Doing Business in the Saudi Arabia Water Sector

Although U.S. exporters are not required to appoint a local Saudi agent or distributor to sell to Saudi companies, it is strongly recommended that companies consider partnering with a local company for the purposes of monitoring business opportunities, navigating import and standard testing regulations, and identifying public sector sales and contract opportunities.  

Saudi Arabia’s Procurement Law regulates all government procurement – including MEWA and WERA tenders.  The Ministry of Finance is the overarching authority for the law and its implementation, and administers the procurement portal, Etimad, which serves as a centralized repository for all government tenders.  Under Vision 2030, water is a sector targeted for privatization by the NCP; however, SWPC has emerged as a leading procurement entity in this sector.  In addition to finding procurement opportunities posted on the NCP website, U.S. companies should also explore the SWPC and WTTCO websites for opportunities.

Opportunities

According to its 2022 budget, Saudi Arabia plans to attract local and international investments through tendering 10 projects worth approximately $3.2 billion focusing on sanitation and water desalination, transmission networks, and strategic storage.

MEWA plans to meet 90 percent of Saudi Arabia water demand using desalinated water and 10 percent using ground and surface water by 2030.  Based on existing urban water demand and committed water supply, new urban desalination plants would be required to overcome a water shortage of 4.5 million m3/day.

Saudi Arabia’s current and forecasted sewage network covers about 50 percent of total wastewater generated.  According to 2018 data, Saudi Arabia has approximately 5.6 million m3/day of wastewater treatment capacity with 3.2 million m3/day under construction with 0.4 million m3/day planned for decommissioning.  To achieve 2030 treatment targets, a total of 8.4 million m3/day of capacity addition is required. 

Valued at $4.69 billion by Gulf State Analytics, Saudi Arabia’s water reuse market is estimated as the third largest in the world after China and the U.S.  As of 2019, Saudi Arabia has 204 wastewater treatment plants, with much of the treated non-potable wastewater finding useful purposes as “grey water,” watering green spaces in cities, irrigating crops, or reused in industry.  Saudi Arabia has set a goal to achieve 100 percent reuse of treated urban wastewater by 2025.

SWPC seeks to progressively increase the participation of the private sector to 100 percent in desalinated water production by 2030.  Between 2022 and 2030, it plans to bridge gaps in water production, strategic storage, and treatment capacities by analyzing supply and demand during this period and deploying projects accordingly.  SWPC is working towards incorporating alternative energy source requirements to improve the uptake of solar generation in upcoming projects, supporting Saudi Arabia’s mandate to increase the usage of renewable energy.

Leading Sub-Sectors 

Water Transmission: As a result of aging distribution systems and inefficient usage, Saudi Arabia can lose up to 40 percent of its transmitted water on any given day.  Opportunities exist for water efficiency and monitoring solutions such as radar beams, audio devices, and helium gas to monitor leaks in the networks.

Desalinization: Based on existing urban water demand and committed water supply, new urban desalination plants would be required to overcome a water shortage of 4.5 million m3/day.  SWPC plans to build 20 desalination plants with a cumulative capacity of 8.5 million m3/day by 2025.

Wastewater Treatment: A total of 8.4 million m3/day of capacity addition is required by 2023 to achieve Saudi Arabia’s wastewater treatment targets.  SWPC plans to build 14 sewage treatment facilities and expand 11 existing facilities to deliver a cumulative treatment capacity of 2.4 million m3/day by 2031. To further reduce leakage and waste, Saudi Arabia aims to reuse over 90 percent of its water by 2040 (currently 65 percent) by transforming its existing and planned wastewater treatment assets into source water suppliers across most industrial sectors. 

Resources

• Ministry of Environment, Water, & Agriculture
• Water & Electricity Regulatory Authority 
• Saline Water Conversion Corporation 
• National Water Company 
• Saudi Water Partnership Company
• Water Transmission and Technologies Company 
• Saudi Technology Development and Investment Company
• National Center for Privatization and PPP
• Local Content & Government Procurement Authority

Events

• Water Environment Federation Technical Exhibition & Conference
• Waste Expo
• Arab Water Forum 
• Gulf Water Conference                                                                   
• Petro Environment  
• Water Arabia
• Big 5 Saudi
• Saudi Agriculture

For more information, contact: sabah.hersey@trade.gov