Interview: Abdullah Al Hashimi
What are the main investment opportunities in the power and utilities sector, and what more can be done to increase foreign direct investment?
ABDULLAH AL HASHIMI: The utilities sector has grown in recent years in terms of customer volume and business activity. This indicates that the economy is recovering and that companies are investing in expanding their businesses or adding assets to their portfolios.
Mechanisms are in place to monitor supply and demand, and to respond swiftly to shifts in the market. This ensures the consistent availability of power and water. Additionally, Oman is moving towards greener forms of power generation and more renewables projects have been awarded, attracting foreign investment.
There is also a strong focus on monitoring alignment with investors in special economic zones to ensure that utilities are available before the commissioning stage. This is done by ensuring their availability within the timeframe agreed upon with investors.
How can the global transition to a more sustainable future be balanced against the need to ensure adequate and affordable electricity domestically?
AL HASHIMI: An expected rise in demand for utilities is an indication of the economy’s recovery. Indeed, the Oman Power and Water Procurement Company estimates that demand for electricity and water will increase by 2% and 3%, respectively, each year through 2026. The country has also made commitments to energy sustainability and reducing carbon emissions. In this sense, Oman is moving towards an energy mix with more clean and renewable energy sources. The private sector has been investing in generation facilities, with international developers taking the lead.
The sultanate is looking to replace its conventional power plants with facilities powered by renewable sources of energy, thus reducing its dependency on fossil fuels. Special attention is expected to be given to certain industries, such as petrochemicals and metals, to ensure that there is enough electricity available to meet these industries’ specific operational needs.
Where are the opportunities for Oman to meet the region’s future electricity and water needs?
AL HASHIMI: Better cohesion, collaboration and regional integration are essential to meet future electricity and water demands. GCC countries have established interconnections and mechanisms for importing and exporting electricity. Shortages in one country can be fulfilled by another, leading to the better utilisation of installed capacity, enhancing returns and boosting spending efficiencies. There are also options to expand such structures to outside the GCC.
Establishing redundancy and capturing future growth is better served by interconnections. Imports and exports can balance fluctuations in supply and demand, and overcome technical challenges or blackouts in any country. This approach increases the system’s flexibility and reliability, which is vital to sustainable growth and development. Oman’s utilities expertise positions it to become an exporter of water and electricity to its neighbours due to its location in the Gulf and natural resources, among other factors.
In what ways can Oman boost its research and development (R&D) capacities to improve local power generation and competitiveness?
AL HASHIMI: Oman Vision 2040 highlights R&D’s importance in leveraging national resources and enhancing local competitiveness. Unless we develop domestic competencies, we will remain reliant on external help. R&D is critical, and there have been efforts to develop competencies in different disciplines. Marafiq is currently working with local and international stakeholders to address challenging issues related to water. At the national level, the Ministry of Higher Education, Research and Innovation is taking important steps with leading academic institutions to sponsor R&D projects.