Special report: Oman goes solar
Oman enters an era of renewable energy with first solar project
The need for more water and power is intrinsic to all arid countries of GCC, which are developing their economies and undergoing rapid industrialization with growing population. The story of the Sultanate of Oman is no different and having become the latest entrant to the solar bandwagon, the country is gearing up to harness the region’s most abundant resource.
Late last year, the Omani Rural Areas Electricity Company (RAECO) signed the first agreement to generate electricity from renewable energy resources, with US-based company Astonfield. The company, in cooperation with a local firm Multitech, will establish a pilot solar power plant in the state of Al Mazyunah in the Dhofar Governorate, which will begin commercial operation in mid-2014.
“The project is being realised thanks to the leadership of the Government of Oman, and especially the Authority for Electricity Regulation (AER) and Rural Areas Electricity Company SAOC (RAECO). Astonfield has co-developed the project in close partnership with Bahwan Engineering Group through their investment arm Multitech LLC,” said Ameet Shah, co-founder and co-chairman of Astonfield.
This power purchase agreement for the Al Mazyunah Solar Energy Project is said to mark the beginning of a new phase in Oman’s power generation sector as it relies on US technical expertise. The country is said to be uniquely positioned at 23 degrees from the equator, which will allow for maximum utilisation of the solar radiations, and this pilot project will determine the specific advantages and challenges of operating such a plant in the Sultanate.
Astonfield will install two different types of solar energy generation technologies to evaluate the best method for energy production, using the company’s vast experience in the domain to tailor the project to Oman’s specific environment.
Sourabh Sen, co-founder and co-chairman of Astonfield said, “Oman possesses one of the best solar resources in the world. Given that, the scope for solar power in Oman is very large. As the country’s economy continues to grow, solar power can become an important component of the country’s energy portfolio. Similar to India, Oman is evaluating the value of diversifying its energy generation to meet new demand, and it makes sense to develop solar power generation due to the technology’s cost-effectiveness.
“Furthermore, solar power is a great opportunity for Oman because of the ability to decentralise solar generation capacity and locate power plants in close proximity to the point of demand without significant investment in new transmission infrastructure. We believe there is scope for utility scale solar plants, but also decentralised off-grid solar and rooftop solar applications,” he said.
The Al-Mazyunah solar project will be a 303kW system expected to produce 558 MWh per year. The project will be executed in a single phase that is expected to be completed by the middle of 2014. Italian company, Solesa International which has expertise in solar engineering, implementation and operation, has been selected by Astonfield and Multitech as the EPC contractor on the project. “Upon commissioning, the project has been contracted to supply solar electricity to RAECO for an operating period of 20 years. Astonfield and Multitech will finance and own the power plant for its lifetime and will be responsible for the overall success and performance of the project in each of its phases,” said Shah. Thus this project too will be developed under the ‘build, own, operate’ system.
The agreement is a result of AER’s renewable energy study, which recommended the implementation of small scale pilot projects by RAECO to produce electricity using renewable energy resources, specifically solar and wind. RAECO selected several suitable sites and zeroed in on the one located in Al Mazyunah, near the existing power station owned by it, according to a news report. The project is said to be the first of its kind and will help produce electricity in a hybrid system along with the existing diesel power station and feed the existing electrical network. It is expected that the project will be able to cover most of Al Mazyunah’s demand for electricity in the winter period, at least in the early years of the project’s timeframe, bearing in mind the possibility of project expansion.
The 8,000 sqm development will use both crystalline-silicon (c-Si) and thin-film PV technologies. “Since this is a pilot project for the Sultanate of Oman, it will serve to provide invaluable data to the government regarding how both mainstream PV technologies perform in Oman’s climate. Our experience developing solar projects globally has given us significant knowledge about how to select and optimise the most suitable technology for different climates, and we applied that knowledge in Oman. CSP technology would not be viable at this pilot scale and in general we believe PV technology presents tremendous cost advantages that result in a lower cost of electricity for the end consumer,” said Sen.
One of the major issues encountered during solar plant maintenance in the desert is dusting. The settling of fine dust reduces the absorption of solar radiation and cleaning it usually requires a considerable amount of water. Thus larger the plant, more water that will be required and with water being a precious commodity in the desert, this issue takes further more importance.
“We have considered the impact of dusting during the planning stages of the project. All solar power plants have in their operations and maintenance (O&M) processes a cleaning schedule to maintain optimal panel performance,” Shah said. “Given the arid climate in Oman, monitoring and cleaning the panels will be a special area of focus for the partnership. After all, this is a pilot project and we expect to gather a lot of information on all aspects of solar power in Oman for the benefit of future solar development. We intend to take what we have learned from our existing power plants, some of which are also in deserts, and fine tune our O&M processes for Oman’s unique climate.”
Thus familiarity with the arid climate of the Middle East in general and Oman in particular is essential and Astonfield is said to have begun its technical feasibility work in the country several years ago.
The company also has experience building and operating solar plants similar desert conditions. “Our 5MW solar plant in Rajasthan, India, is located in the Thar Desert. That plant has performed above all expectations since beginning operation in October 2011. In fact, that project was the first solar project in India to receive an A- credit rating from CRISIL, which is majority-owned by Standard & Poor’s. We believe that this is a testament to the quality of the power plant. We expect the same results with our projects in Oman,” Shah said.
The region has been in the perpetual power shortage and the governments have been taking various steps to iron out the deficit but with little luck. Heavily subsidised electricity - of nearly 3 times the international value of the fuel - means lower tariffs, which poses a huge burden on the government. And along with new civic expansions demanding more power, there is rising environmental concern due to excessive consumption of fuel in producing power. The Al Mazyunah Solar Energy Project aims to tackle some of these issues while giving further insight into how such projects can help improve the country’s economy in a sustainable manner.
Other than to test the performance of the solar technology in local weather conditions, being a project focusing on renewable energy, one of the main objectives of the pilot plant will be to study the reduction of fossil fuel emissions. This data will give a realistic view of the environmental damage caused by burning diesel fuel. Another aspect of the study will focus on how cost effective operating a solar plant would be when compared to one that uses fossil fuel. The data collected from this pilot plant is also expected to help RAECO officials in making crucial decisions on future projects focusing on renewable energy technologies. Further, the officials will also learn to operate and maintain such technologies.
The pilot plant has been commissioned keeping in mind that operational costs of using solar energy to produce electricity is less than using fossil fuel, but it is just that the technology itself is still developing and so the initial costs may be higher. Similarly, use of renewable energy is expected to recover the lost revenue from the subsidies.
Shah said, “Our partner Bahwan Engineering Group has been a pioneer in partnering with the Government of Oman on its privatisation initiatives for the power sector. Astonfield has also invested heavily to develop projects in countries such as Oman where there is significant potential to scale up solar power capacity, however there is no regulatory framework or track record within the country to do so. AER and RAECO deserve significant credit in the case of Oman for their willingness to invest in building out a thorough set of project documents, including a very thorough Power Purchase Agreement, which are intended to act as templates for future solar projects as well.
“As we move forward with this project, we intend to continue to work collaboratively with the government and all stakeholders to make this initial pilot project a resounding success and then to look at other opportunities to invest in building out the solar infrastructure of the country,” Shah said.
There has been a major thrust to experiment with green power projects across the country, thus the Al Mazyunah Solar Energy Project is but one of the projects initiated by the Omani government to promote renewable energy. According to news reports, Haima, in the central governorate of Al Wusta, may soon host a big project that may generate upto 1,000KW of power. Talks are abuzz that Dhofar may soon be home to another solar power generation unit at Al Mathfa.