Like lots of countries in the Middle East, Oman’s economy is dependent on oil and gas. It accounts for about 60 percent of the sultanate’s total export income. Moreover, domestic natural gas is responsible for more than 95 percent of its electricity generation.
However, Oman is aware of the environmental concerns associated with mining and crude oil production. It is striving to dramatically transform its power grid and economy through the introduction of more sustainable energy sources.
In October 2022, Minister of Energy and Minerals Salim bin Nasser al Aufi unveiled Oman’s National Net Zero Plan. It includes an ambitious target to achieve net zero emissions by 2050 and diversify and strengthen the economy with various decarbonization efforts. Below is a look at three renewable sources of energy Oman is prioritizing as part of the National Net Zero Plan.
Hydrogen
Green hydrogen captured from renewable sources will be a driving force toward net zero emissions in Oman. The country is working with the International Energy Agency (IEA) to determine the best approach to scale its hydrogen production. It is also looking to attract investment by taking advantage of its vast swaths of land and high-quality renewable energy resources.
Through an analysis of the global project pipeline, the IEA projects Oman could become the largest hydrogen exporter in the Middle East and the sixth largest in the world by 2030. At that point, it is expected to produce more than 1 million tons of renewable hydrogen annually. Oman intends to produce as much as 8.5 million tonnes every year by 2050. This is more than the total hydrogen demand in Europe today.
“Oman is an oil and gas producer country that is taking an enlightened approach to its energy future, with a clear long-term vision and strong net zero ambitions,” said Dr. Fatih Birol, executive director of the IEA. “Thanks to its huge potential for low-cost solar and wind, renewable hydrogen is set to bring multiple benefits to Oman. The IEA is very pleased to be working with Oman on policy and technical matters as the country moves ahead on its journey to a net zero economy and shows other producer countries what is possible.”
Hydrogen Oman, an independent entity created by the Omani government in 2022, will oversee the country’s hydrogen projects. Oman has already designated 579 square miles of land for development by 2030 with another 23,000 square miles selected for potential long-term production sites.
To realize these developments, Oman needs significant investment and a major increase in its production of renewable power. In its report, the IEA projects the entire scope of Oman’s hydrogen-focused initiatives could require $33 billion, including the cost of deep-water jetties and storage tanks to increase ammonia export capacity. Oman expects to need billions more to further scale production to meet its 2050 net zero target.
Wind
Oman is also prioritizing wind energy projects to reduce its carbon emissions while still fulfilling its national energy requirements. It is home to the 50-MW Dhofar Wind Power Project, the first large-scale wind farm in the Gulf Cooperation Council. Additionally, the country recently designated almost 100 square miles for wind farms and solar parks in the Special Economic Zone at Duqm (SEZAD). There, green hydrogen and green ammonia will be produced for local use and export.
In May 2023, Oman Power and Water Procurement Company (OPWP), announced plans to develop wind farms at Duqm, Jalaan Bani Bu Ali, and Harweel. OPWP is also completing Wind Resource Assessment studies to identify the best locations for wind farms. Dhofar and Al Wusta, along the coast, have the most favorable wind conditions.
The wind farm in Dhofar, completed in 2019 by Masdar and funded by the Abu Dhabi Fund for Development, features 13 wind turbines. It provides more than enough energy to power 16,000 homes—about 7 percent of all electricity needs in the Dhofar governorate. It also saves about 110,000 tonnes of carbon emissions per year.
Solar
Finally, Oman is harnessing its ample sunlight and clear skies to foster growth in the solar energy sector. Following a 13-month construction period, the Ibri 2 independent power project (IPP) opened in the Ad-Dhahirah governorate in January 2022. The 500-MW solar field was developed by a consortium of energy companies, including ACWA Power. The project cost $417 million and features 1.5 million bifacial solar panels. It generates enough electricity for 50,000 homes.
To achieve its target of renewables having a 30 percent share of its national grid, Oman is also building 11 solar-diesel hybrid facilities and a pair of solar IPPs in Manah. These facilities are expected to be completed by 2025. A 146-MW solar-diesel project in Tanweer and a 15-MW solar power plant in Al Namaa are in the bid evaluation phase. Oman is also installing solar panels on commercial and residential buildings as part of its Sahim initiative. The country’s first 1-MW rooftop solar PV system was installed in 2019.