MUSCAT: A new policy framework unveiled by Oman’s Ministry of Energy and Minerals last week is expected to lend new impetus to the growth of integrated renewable energy capacity, encompassing not only generation and transmission, but crucially, energy storage as well.

Investments in energy storage, while a critical component of clean energy infrastructure, have lagged in the Sultanate of Oman, among other markets around the world, chiefly because of high, upfront capital costs, as well as concerns over energy efficiency. Regardless, their importance is never in doubt when it comes to securing constant renewable energy supply, ensuring grid reliability and power quality, and enabling the scale-up of renewable capacity.

According to experts, the ‘Electricity Self-Generation, Direct Sales, and Wheeling Policy’ – also referred to as ‘New Renewable Energy Policy’ – seeks to underscore, among other key objectives, the significance of electricity storage in achieving Oman’s Net Zero goals.

The policy document defines Electricity Storage as: “The conversion of electrical energy into another form of energy for storage in storage equipment such as batteries for a limited period of time, and then reconverting it into electrical energy for direct consumption by the self-generator or delivery to the grid or direct sale and wheeling through the network.”

Acknowledging the “absence” of energy storage technologies in Oman, notably because of the “high-costs” involved, the new policy nevertheless seeks to enable the deployment of economically feasible battery storage infrastructure and for these attendant costs to be recouped from large consumers benefitting from such investments.

In effect, two categories of developers stand to benefit from the policy initiatives advocating for the growth of energy storage infrastructure. In the first category are ‘Self-Generators’ – a reference to developers investing in renewable energy capacity, with the electricity output earmarked for captive consumption.

“Self-generators shall be permitted to establish, own, and operate electricity storage equipment (storage batteries) whenever the economic feasibility of the storage technology allows it – as a sub-class of generation – in accordance with the terms and requirements set by the Authority for Public Services Regulation,” the Ministry explained in its policy framework.

In the second category are developers eligible to invest in renewable energy capacity for supply to large consumers via the ‘Direct Sales’ route.

Significantly, the new policy initiatives will help build on efforts by Nama Power and Water Procurement Company (PWP), the single buyer of power and water output, to support the development of energy storage in the country. Energy storage is a key objective of a strategic study being undertaken by PWP aimed at achieving an ideal mix of energy resources to sustain the country’s energy requirements over the next 15 years.

However, some private sector entities have announced preliminary steps towards energy storage investments. In March 2024, well-known Omani firm Nafath Renewable Energy signed an MoU with Takhzeen, a 100 per cent subsidiary of publicly traded firm ONEIC, to help introduce renewable energy supply backed by battery energy storage, particularly in rural parts of Oman.

Takhzeen represents leading Italian-based energy storage solutions start-up Energy Dome, which is backed by IDO Investments, the venture capital arm of Oman Investment Authority (OIA). Energy Dome has also revealed that it has signed an MOU with Oman Investment Authority to explore potential areas of collaboration in Oman.

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