Oman has introduced a landmark reform to its electricity sector, allowing renewable energy developers to sell power directly to large industrial and commercial customers. The move ends a system that, for more than 20 years, required renewable electricity to be sold exclusively through a single government buyer, opening the door to a competitive private renewable energy market.
Under the new regulatory framework, renewable projects will be classified according to their generating capacity, with different rules governing developer participation. The government will retain exclusive control over projects exceeding 50 megawatts (MW) per subscriber, while private developers will be permitted to build and operate projects ranging from 0.25 MW to 50 MW, subject to licensing requirements and location-based regulations. Projects above 25 MW will also require approval from the Ministry of Energy and Minerals.
Small-scale renewable installations below 0.25 MW have been reserved for small and medium-sized enterprises (SMEs) holding a Riyada certificate, supporting local business participation in the clean energy transition.
A key feature of the reform is the liberalization of electricity pricing, enabling renewable energy producers and consumers to negotiate power purchase agreements directly without government-imposed price controls.
Oman’s latest initiative follows similar reforms in several regional and international markets. Egypt approved its first private-to-private renewable energy agreements last year, authorizing four wind and solar projects with a combined capacity of 400 MW and investments totaling approximately $388 million. Vietnam also introduced a Direct Power Purchase Agreement (DPPA) framework in 2024, allowing large consumers to procure electricity directly from renewable generators, while Jordan has adopted a wheeling model that enables businesses to source renewable energy through the national grid under regulated transmission charges.
The reforms position Oman to attract greater private investment in renewable energy while expanding clean power options for major industrial and commercial consumers.
