Policy reforms to boost Oman’s renewables-focused electricity market

https://www.omanobserver.om/article/1167196/business/policy-reforms-to-boost-omans-renewables-focused-electricity-market

OMAN DAILY OBSERVER / 5 MAR 2025

CONRAD PRABHU

MUSCAT: New policy initiatives unveiled recently by the Ministry of Energy and Minerals are designed to pave the way for a more decentralized, efficient, and sustainable electricity market that benefits both producers and consumers, a key Ministry official has emphasized.

Dr Firas al Abduwani, Director General of Renewable Energy and Hydrogen, said the reforms centring around auto generation, direct sales, and wheeling, aim to create a conducive environment for independent developers in Oman’s expanding renewable energy space.

Participating in a webinar on the theme, ‘The Role of Liberalization in the Omani Energy Market’, hosted by the British-Omani Society, the official stated: “These reforms are designed to open up the market. Rather than having all transactions pass through Nama Power and Water Procurement (PWP), we are enabling bilateral agreements where eligible generators and consumers can transact directly while utilizing the national grid for wheeling. This marks a crucial step in reducing dependence on centralized procurement and setting the stage for a more competitive market.”

The ‘Renewable Energy Policy for Self-Generation and Direct Sale’, launched earlier this year, seeks to promote sustainable development, encourage investments in clean energy, and regulate electricity self-generation and direct sales. It is a key milestone in the country’s energy transition as it targets generating 90% to 100% of its electricity from renewable sources by 2050.

Elaborating on the broader objectives behind these policy initiatives, Dr Al Abduwani noted that the Ministry is also embarking on a comprehensive energy market redesign. “We are conducting a full assessment, similar to the exercise that led to the establishment of the regulator, to ensure a holistic and efficient market structure.”

Additionally, the Ministry, in coordination with the Oman Net Zero Centre, is driving new initiatives such as renewable energy certificates and mandatory decarbonization targets. “The renewable energy certificate market will ensure that objectives and targets are met efficiently,” he said.

Furthermore, the government is evaluating various renewable energy and storage options, including pumped hydro, to enhance grid stability. “We are looking at ways to integrate storage solutions and ensure that our policies support the growth of renewables without compromising reliability,” he added.

Beyond market liberalization, Dr Al Abduwani emphasized the Ministry’s vision for fostering national champions in the renewable energy sector. “With Oman’s vast renewable energy potential, we aim to see major national champions operating internationally, with OQ Alternative Energy (part of OQ Group) playing a key role. Simultaneously, we want to create ample space for independent developers to drive innovation, challenge norms, and contribute solutions.”

Also taking part in the webinar were: Eng Hilal al Ghaithi, Director of Energy – Authority for Public Services Regulation (APSR); Head of Project Development - Clean Energy, OQ Alternative Energy; and Mikey Clark, CEO of Relode. Session hosts included: Chris Breeze, Vice Chair – British Omani Society; and Anna Halpern-Lande, Co-CEO and Co-Founder, Ortus Climate Mitigation.