Oman mulls introducing electricity spot market
The initiative is expected to be operational by 2017
Oman Power and Water Procurement Company (OPWP), the sultanate's single buyer of power and water for all IPP/IWPP projects, is planning to introduce a spot market for electricity in order to promote competition among power producers in the Sultanate.
The initiative is expected to be operational by 2017. Strong regulations and transparent policies are some of the main reasons why Oman has been able to bring in vast private sector investment. The country’s Royal Decree No. 77/2004 (Law of Privatisation) allows for the establishment of public private partnerships (PPP) and grants the private sector the right to construct own and manage privatisation projects.
According to a 2012 report, following the promulgation of the Sector Law on August 1, 2004 (Royal Decree 78/2004), the government embarked on a comprehensive programme for the restructuring, regulation and privatisation of the electricity supply and related water industry in Oman. The decision to privatise in the electricity and water sectors stems from the belief that the private sector is better placed to drive innovation and reduce costs in what has become one of the most expensive items on the government’s balance sheet.
There is now an extensive and successful track record of private participation in the electricity generation and water sector in Oman; to the extent that 85 per cent of the sector is priva-tised, the report added.