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Engie picked for Esco work by Saudi Arabia's PIF-backed Tarshid

EXCLUSIVE: French giant is working with Tarshid, formed by PIF in 2017, to cut energy use in administrative buildings

Tarshid was formed by Saudi Arabia's PIF in 2017.
Pixabay
Tarshid was formed by Saudi Arabia's PIF in 2017.

French energy giant Engie is working with a subsidiary of Saudi Arabia's Crown Prince Mohammed Bin Salman-led Public Investment Fund (PIF) to reduce energy consumption of Saudi government buildings, a company official told Construction Week.

The utility outfit is working with Saudi Arabia’s National Energy Services Company (Tarshid), formed by PIF in 2017, to cut electricity and water use at administrative sites by up to 30%.

READ: Saudi sovereign wealth fund forms $507m-worth Esco

Engie is currently implementing one project for the government and one for a private-sector client, Stephane le Gentil, head of energy efficiency at Engie in the Middle East, told Construction Week.

Retrofitting buildings to reduce energy bills includes processes such as installing small sewage treatment plants and solar panels; replacing incandescent lightbulbs with LEDs; and upgrading old air-conditioning units.

Saudi Arabia uses oil to generate electricity, but reducing its energy consumption will offer it more oil to export and generate greater state revenues, Gentil suggested. 

READ: UAE's Etihad Esco and Saudi's Vision Invest establish energy company

“[The effort] is part of the Vision 2030 mandate to better use energy and reduce the [consumption],” he said.

While Engie has been active in Saudi Arabia for close to two decades, it only created its energy services company (Esco) in 2018.

Obtaining an Esco license allowed the firm to bid on government retrofitting projects.

Tarshid is mandated under a royal decree to develop, fund, and manage energy efficiency projects, and Gentil said the firm had approximately $500m (SAR1.8bn) in funding for the initiative.

“Tarshid is the only entity that is mandated to retrofit buildings,” he said. “The objective they are looking for is to reduce the cost of electricity and water in government buildings by 25-30%.

"They take buildings or sets of buildings and tender them to companies that are licensed to do this work, which is Escos.”

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Construction Week - Issue 754
Nov 23, 2019