As part of its statutory functions and duties towards the regulation and privatisation of electricity and related water sectors, the Authority for Electricity Regulation (AER) held a press conference to launch its Forward Work Programme for 2018.
Present at the briefing were Qais bin Saud al Zakwani, Executive Director; Amal al Zadjali, Senior Specialist for Communication External Liaison & CSR; Hilal al Ghaithi, Deputy Director of Customer Affairs; and Abdulwahab Abdullah al Hinai, Director — Licensing & Legal Affairs.
Reinforcing transparency among stakeholders and in-line with the government policies to ensure consistency of work planned for each subsequent year, the 13th edition of the programme will include several priority areas aimed at enhancing the electricity sector efficiency, promoting competitiveness of the local market, and conducting initiatives for renewable energy.
Speaking at the event, Qais bin Saud al Zakwani, Executive Director of AER, said; “The Authority is pleased to announce the Forward Work Programme for this year which focuses on developing the electricity sector and supporting related companies in their various business aspect. It will also provide studies and strategies for the government in the economic operations of these related sectors. In addition, the Authority will be reviewing best international practices to support the introduction of Electric Vehicles (EV) and public recharge stations in the Sultanate.”
Al Zakwani added, “In our role towards the environment protection and optimal use of clean energy sources, we launched our first renewable energy initiative, Sahim, in 2017. This year, we intend to announce a tender for an initial tranche of PV solar system installations in residential premises. We also take pride in our bilateral cooperation with Oman Environmental Services Holding Company (Beah) with regards to waste to energy projects.”
The programme will carry out a timescale to progress the competitive market review (CMR) in 2018 and engagement of key-stakeholders in other related area. Continuing the health and safety audits conducted last year, the Authority plans to perform audits in 2018 to monitor the companies’ compliance of HSE rules and regulations. AER also aims to audit the licensees’ implementation and compliance to the SCADA and DCS cyber security standard.
It is worth mentioning that AER is dedicated to enhancing the electricity and related water sector and ensuring protection of customers’ interests and services supply. It remains committed to carry out strategies and studies in the renewable energy field.
2018 Work Priorities
The 2018 Forward Work Programme includes a number of ‘high priority’ areas of work:
♦ Electric Vehicles
The Authority intends to carry out a review of international best practice in relation to the regulatory framework to support the introduction of Electric Vehicles (EV) in the Sultanate of Oman. The review will look into potential capital costs from development of public EV recharge stations, network and connection issues, safety issues, metering costs and the required licence and Code modifications required in relation to Distribution Network Operator responsibilities.
♦ Development of competitive market
The Authority will work on developing an overall programme of work and timescale to progress the Competitive Market Review (CMR) in 2018. The Authority commenced preparatory work on the development of competition amongst Licensed Suppliers in 2017 and intends to implement the recommendations in 2018. This will include engagement with key-stakeholders which will enable the Authority to develop a timescale from the introduction of competition in the supply business.
♦ Deployment of residential PV initiative (Sahim)
The Authority launched the Sahim initiative in 2017 to facilitate the deployment of residential PV systems. In 2018, the Authority intends to build on the work undertaken in 2017 with the objective of launching a tender for an initial tranche of PV installations in residential premises. This will entail ensuring that issues such as regulatory arrangements, contractual frameworks, customer propositions, output monitoring methodology and other related issues are addressed prior to the launch of the first tranche.
♦ Establishment of an ESCos Market
The Authority undertook a number of government building audits in 2017. In 2018, the Authority intends to build on the work undertaken in 2017 with the objective of establishing local Energy Services Companies to support the government’s energy efficiency objectives. This includes assessing best sectors in the country to target and ensure reasonable demand, and raise the capabilities of local SMEs to undertake the work of ESCos.
♦ Waste to Energy Initiative
The Authority, in coordination with the Oman Power and Water Procurement Company and the Oman Environmental Services Holding Company (Beah), intends to commence preparatory work to assess the possibility of procuring waste to energy projects. We intend to build on the considerable work undertaken by Beah with regards to waste to energy and establish the framework, including the project definition and competition process, to facilitate the implementation of such projects in the future.
Other areas of work planned for 2018
In addition to the ‘high priority’ areas of work outlined above, the Authority expects to progress other areas of work during 2018, including:
♦ Oman Electrical Standards and Electrical Regulations
The Authority aims to continue to review the OES and work to update and issue revised and new OES throughout 2018.
♦ Protection: Appropriate Person Criteria follow-up
During 2017 the Authority conducted audit of protection capability for the companies. The audit identified two companies that have not achieved Appropriate Person Criteria. The Authority intends to monitor progress of the two companies, and once adequate progress has been to re audit their protection capability.
♦ Health and Safety Audits of Oman Electricity Transmission Company (OETC), Oman Power and Water Procurement Company (PWP) and Dhofar Power Company (DPC)
To complete the Health and Safety audit cycle, the Authority plan to perform health and safety audits of OETC, PWP and DPC in 2018. For PWP, the Authority is keen to examine in some detail how effectively the contractual arrangements facilitate adequate control of health and safety.
♦ Oman Electricity Transmission Company (OETC) and Oman Power and Water Procurement Company (PWP) Price Control Review
Current OETC and PWP price controls are due to expire on December 31, 2018. New price controls are therefore required to be set for January 1, 2019.
As part of the OETC price control review the Authority intends to assess options for evolving OETC’s charging basis, taking into account a number of developments including: (i) the recent implementation of Cost-Reflective Tariffs; (ii) potential developments to the grid, interconnecting the MIS, Duqm, Dhofar and PDO Systems; and (iii) the introduction of an electricity spot market.
♦ Assessment of Cost Reflective Tariffs
Following the completion of a full year from the implementation of Cost-Reflective Tariffs, the study will assess how different categories of consumers (Industrial, Government and Commercial) have responded to the new tariffs. We will also explore possible refinements to the CRT.
♦ Cyber Security Standard
The Authority intends to audit the licensees’ implementation and compliance to the SCADA and DCS cyber security standard that was issued by the Authority in 2015. The audit would review aspects related to governance of the SCADA and DCS environment including management systems and implementation of technical controls.
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