Qatar has taken concrete steps ahead of plans to privatise its power sector. The country currently has an electric generation capacity of 1,819 megawatts (MW) from six power plants, mostly gas-fired, and the government has said it will follow a multi-path approach to privatisation.

The Ministry of Electricity and Water was abolished and its assets were transferred to the newly established government-owned Qatar General Electricity & Water Corp (Kahramaa).

Kahramaa, which will own and manage the transmission and distribution facilities, will divest its generation assets in phases in accordance with government plans.

In February 1998, the government transferred the 610 MW Ras Abou Fontas-B (RAF B) plant to the Qatar Electricity & Water Company (QEWC). QEWC is 57 per cent controlled by local investors and 43 per cent by the government and is expected to play a very key role in future power issues.

QEWC, which is pursing an aggressive expansion plan at RAF B, succeeded in improving the efficiency and reliability of the RAF B power and desalination plant and providing substantial returns to shareholders.

QEWC's success, coupled with the need to unbundle generation assets from the rest of the network, led the government to decide on transferring the remaining Kahramaa plants to QEWC.

Kahramaa will be the transmission and distribution company, and the off-taker of power and water produced by QEWC and other companies.

Meanwhile, the 750 MW Ras Laffan power plant is expected to be grid connected within a few years to Saudi Arabia, and later to the UAE. Kahramaa will be the first electric utility in the region to be buying all its power from others.