Oman aims to enhance its electricity generation capabilities through renewable Independent Power Projects (IPPs), targeting a minimum of 30 percent of electricity derived from renewables by 2030. Despite some adjustments to its ambitious renewables targets due to fiscal constraints since 2020, numerous opportunities exist for U.S. firms in this sector.
Since 1994, Oman has been a pioneer among Gulf Cooperation Council (GCC) countries in developing independent water and power plants and IPPs. The state-owned Petroleum Development Oman (PDO), aspiring to reduce emissions to 50 percent of 2019 levels by 2030, has been at the forefront of large-scale solar power initiatives in the country.
The largest utility-scale solar photovoltaic IPP in Oman, Ibri 2, commenced commercial operations in January 2022. The Oman Power and Water Procurement Company (OPWP) awarded the project to a consortium of Saudi and Kuwaiti firms, backed by a USD 60 million loan from the Beijing-based Asian Infrastructure Investment Bank (AIIB). This marks AIIB’s inaugural renewable energy financing project in Oman and the region.
In line with 2030 targets, Oman has undertaken various projects, including a wind farm in Dhofar, two solar IPPs in Manah, 11 solar-diesel hybrid facilities, and the ‘Sahim’ initiative to install small-scale solar panels on residential and commercial buildings. In April 2022, OPWP invited consultants to bid for Oman’s first Waste-to-Energy project.
The government’s strategic plan envisions Oman as a hydrogen-centric economy by 2040, targeting an annual production of approximately 30GW of green and blue hydrogen. The country has announced several gigawatt-scale green hydrogen projects, including a 14GW facility powered by 25GW of wind and solar energy, totaling over $45 billion in value. To oversee hydrogen projects, Oman established a Directorate General for Clean Energy and Hydrogen at the Ministry of Energy and Minerals, along with an EDO subsidiary called Hydrogen Development Oman.