PPA regulatory framework in Oman

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PPA regulatory framework in Oman

According to Oman’s Authority for Public Services Regulation, a highly awaited regulatory framework intended to allow qualified power providers to sell electricity directly to large consumers will be finished by the end of this year (APSR). To speed up the pace of foreign investment in Oman’s emerging renewables and green hydrogen industries, the Direct Sales Framework, which is a component of attempts to further liberalize the country’s power sector, is essential. Additionally, it would enable so-called “bilateral agreements” signed directly between significant consumers and generators, eschewing the state-owned Oman Power and Water Procurement Co. (OPWP), the sector law’s only buyer of all power output.

Following the Council of Ministers’ approval of this new initiative last year, work on the legislative and regulatory framework that would support it got under way. Its actual implementation is planned in stages, with the Authority preparing to conduct ongoing assessments of the project to make sure it “meets the legislative and technical standards” and is “economically feasible.” “In the first phase, the eligible participants include generators with expired PPA (Power Purchase Agreements) and industrial clients with current captive output,” the Authority said of the customers that are qualified for direct sales of wholesale power.

Qualified participants

The Authority stated that the list of qualified participants may be expanded in due time. Technical considerations must be taken into account by the Direct Sales Framework, primarily to guarantee that physical connections, dispatch implications, metering data, and settlement implications are all taken into account. However, the price signals that current electricity system users and consumers who are qualified for direct sales perceive also have complicated commercial and economic repercussions, it continued. The Direct Sales Legal Framework is anticipated to encourage investments in large-scale renewable and green hydrogen projects, which the Omani government is counting on to support its transition away from hydrocarbons as the main engine of the nation’s economic development. This will also help the system save money.

Oman Green energy Projects

In the Sultanate of Oman, a number of green energy projects with a combined global capacity of 30 gigawatts (GW) of renewable energy are anticipated to be implemented during the ensuing decades. The output of these multibillion-dollar investments in green hydrogen and green ammonia is expected to support a variety of green industries as well as zero-carbon transportation and mobility options. While some of the green hydrogen and green ammonia is expected to be exported to international markets, the remainder is anticipated to be used locally. The Omani government’s goal of sparking the development of a future zero-carbon economy in the nation is considered as being realized in large part via the Direct Sales Framework.