The capital Riyadh, located in the heart of the country, is supplied with desalinated water pumped from the Persian Gulf over a distance of 467 km.

Another challenge is weak institutional capacity and governance, reflecting general characteristics of the public sector in Saudi Arabia.

Among the achievements is a significant increases in desalination, and in access to water, the expansion of wastewater treatment, as well as the use of treated effluent for the irrigation of urban green spaces, and for agriculture.

Since 2000, the government has increasingly relied on the private sector to operate water and sanitation infrastructure, beginning with desalination and wastewater treatment plants.

Likewise, the government directly pays private operators that run the water distribution and sewer systems of large cities under management contracts.

The pond, holding more than 50 million cubic meters of sewage, almost overflowed during heavy rains in November 2009 threatening to flood parts of the city.

It is tentatively estimated that average water consumption for those connected to the network is about 235 liters per capita per day, a level lower than in the United States.

In Riyadh 50 million cubic meter per year is pumped over 40 km (25 mi) and 60m elevation to irrigate 15,000 hectares of wheat, fodder, orchards and palm trees.

The capital Riyadh, however, is supplied to a great extent with desalinated water pumped from the Persian Gulf over 467 km to the city located in the heart of the country.

Saudi Arabia holds approximately 35% of the Arab Region’s desalination capacity which includes Algeria, Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauretania, Morocco, Oman, Palestine, Qatar, Sudan, Syria, Tunisia, the United Arab Emirates, and Yemen.

It is estimated by 2030, 50% of Saudi Arabia’s local oil and gas will solely be used to meet the rapidly growing demand for water.

Desalination barges have operated since 2008 to meet high seasonal demand for potable water along the Red Sea coast of the Kingdom.

The country has eleven renewable alluvial aquifers with an estimated combined mean annual recharge of nearly 1 billion cubic meters per year.

[24] As of late 2014,[update] the timing was pushed back to 2017/18 and NWC expected to take a 40% share in each of the Joint Ventures that would be selected to run the water and sewer systems of the three cities.

[25] Due to generous subsidies for water provided by the government of Saudi Arabia to its people, the country experienced rapid growth in irrigation areas.

[27][28] Until the establishment of the National Water Company (NWC) in 2008 there was no separation between institutions in charge of policy and regulation on the one hand, and service provision on the other.

The quality and efficiency of service provision are hampered by the many weaknesses afflicting the public sector in Saudi Arabia in general.

These include an inadequate civil servants recruitment policy, insufficient salaries, limited skills, no accountability for action taken (or not taken), a lack of strategic planning, and ad-hoc investment decisions.

The recently established Electricity and Co-generating Regulatory Authority (ECRA) only regulates privately owned desalination plants.

The scope of the contracts includes training and qualifying Saudi nationals, as well as research and development with the aim to transfer technology.

[31] The three contracts signed so far are: As required by Saudi law Groupe Saur's team working in Mecca consists entirely of Muslims.

Privatisation will be in two stages: first, investment partners for the desalination plants ("production units") will be sought; then shares of the holding company will be sold on the Saudi stock market.

[35] In the early 2000s, Saudi Arabia began to invite the private sector not only to build, but also to finance and operate new desalination plants.

The first such project in Saudi Arabia was the Shoaiba III Independent Water and Power Producer (IWPP) signed in 2007 and completed in 2010.

[40] IN 2016 WEC planned to become again an offtaker for an IWPP, the Al Kahfji solar desalination plant built by Advanced Water Technology (AWT).

Another large desalination plan on the drawing board is the Jeddah 4 plant that could be implemented as an IWPP, although pre-bidding as a normal construction contract had already been initiated.

The consortium was to rehabilitate, operate, maintain and upgrade the wastewater system of the Jeddah Industrial City over a period of 20 years and invest US$32 million.

This generates a revenue stream that recovers the costs of wastewater treatment under Build-Operate Transfer (BOT) projects financed by the private sector.

Before the 2016 tariff increase, on average "the government (was) only recovering one or two percent of its costs, and the (subsidy) plans are benefiting the rich, not the poor", according to Adil Bushnak.

[45] According to a 2000 estimate by the World Bank, the government paid annual subsidies of US$3.2 billion, equivalent to 1.7% of GDP and 7% of oil revenues.