Renewable Energy Expansion in Oman: Key Insights for Investors and Business Opportunities
MUSCAT: The Ministry of Energy and Minerals is advancing the development of renewable energy projects across Oman as part of a comprehensive strategy aimed at enhancing energy security, promoting sustainability, and diversifying the economy.
The ministry aims to significantly increase the share of renewable energy in the national electricity mix, targeting a goal of 30% by 2030. This effort includes expanding solar and wind energy capacity in various regions of the country.
Oman’s renewable energy sector has made notable strides with the commissioning of several key projects, such as the Ibri (2) solar power plant, along with the Manah (1) and Manah (2) solar projects, as well as the Dhofar (1) wind farm. Collectively, these facilities provide around 1,550 megawatts, which is approximately 9.26% of the total electricity generation in Oman.
Ongoing developments include the Ibri (3) solar power project, equipped with 100 megawatt-hours of battery storage, slated to commence operations in the second quarter of 2027. This addition is expected to enhance grid flexibility and support better integration of renewable energy.
Moreover, wind energy projects in Dhofar (2) and Jaalan Bani Bu Ali are on track for commercial operation by the third quarter of 2027, further bolstering the nation’s renewable generation capacity.
Looking ahead, Oman plans to launch several large-scale renewable projects before the end of the decade. These initiatives include solar power developments in Al Kamil W’al Wafi, Sinaw, and Marsa, alongside wind energy projects in Al Duqm, Mahout, Sadah, Shaleem, and the Al Hallaniyat Islands. Collectively, they are expected to yield around 5,080 MW of solar capacity and 1,720 MW of wind energy. Additionally, a waste-to-energy project in Barka is projected to begin operations in 2031.
These projects will span several governorates, including Dhofar, Al Wusta, Al Batinah North and South, Al Sharqiyah North, Al Dhahirah, and Al Dakhiliyah, with approximately 65,000 square kilometers allocated for renewable energy development.
Through these efforts, Oman aims to elevate the share of renewable energy to between 30% and 40% of electricity generation by 2030, further increasing to 60% to 70% by 2040, and ultimately reaching 90% to 100% by 2050.
Engineer Hamoud bin Hamad al Sawafi, Director General of Renewable Energy at the Ministry, emphasized that these projects are crucial for enhancing the country’s energy security and supporting the transition to a sustainable economy, in alignment with Oman Vision 2040.
He noted that the proportion of renewable energy connected to the national grid rose from 4.26% in 2024 to 9.46% in 2025, with total electricity production from renewable sources surpassing four million megawatt-hours in 2025.
Current renewable projects are also contributing significantly to environmental conservation, helping to prevent an estimated 1.62 million tonnes of carbon dioxide emissions annually. It is projected that avoided emissions will approach nine million tonnes by 2030, with solar projects accounting for approximately seven million tonnes and wind projects contributing around two million tonnes.
Additionally, these initiatives are expected to reduce natural gas consumption for electricity generation by approximately 1.5 billion cubic meters, thus further decreasing carbon intensity in the power sector.
The renewable developments led by Nama Power and Water Procurement Company have achieved local added value levels ranging from 15% to 22%, with an eye toward exceeding 25%, which translates to around RO 25 million. About RO 5.7 million has already been invested in small and medium-sized enterprises that participate in the supply chains for these projects.
OQ Alternative Energy continues to expand its renewable portfolio, increasing capacity by over 2,000 MW in 2025 through power purchase agreements, including projects like the Ibri (3) solar plant and the Dhofar (2) and Jaalan Bani Bu Ali wind projects.
This company also showcased robust local content performance, achieving 23.85% local value in the North Oman solar project, 14.75% in Wind (1), and 18.5% in Wind (2).
Construction is also underway on the North Oman solar project, which has a capacity of 128 MW, in addition to the Wind 1 and Wind 2 projects, which consist of 36 turbines and a combined capacity of 234 MW, targeting commercial operation in 2026.
The expansion of renewable energy efforts is part of Oman’s broader strategy to establish a low-carbon energy system, support emerging industries such as green hydrogen, foster innovation in clean technologies, and enhance Oman’s competitive standing in the regional and global clean energy markets. — ONA
Special Analysis by Omanet | Navigate Oman’s Market
The accelerated development of renewable energy in Oman presents a significant opportunity for businesses aiming to align with sustainable practices, potentially driving growth in green technologies and local investments. However, as the sector evolves, investors must navigate the risks associated with emerging technologies and fluctuating market dynamics. Entrepreneurs should consider leveraging government initiatives and the increasing local demand for renewable energy solutions as a pathway to gain competitive advantage in this burgeoning market.
