Oman Electricity Transmission Company turns potential challenges into opportunities
The Oman Electricity Transmission Company (OETC) has planned an investment program worth an estimated 750 million Omani Rials (OMR) over the next 15 years, to support its 2030 vision that aims to expand infrastructure to meet increasing customer demand.
As part of the new long-term national planning, the company will complete turnkey engineering, procurement and construction projects as part of the multi-million Rial investment, following on from the OMR100 million invested to enhance operations last year.
Dr. Adil Al-Busaidi, Asset Management and Planning Manager at OETC, said: “As a company we faced an average of 9 percent growth annually over the last decade and that is a lot of effort in terms of planning. Currently we have a load demand of around 5GW and we expect that to be in the range of 16GW in 2030 so investment is essential if we are to provide over three times the existing demand.
“Each year we work to increase our capability so we can help deliver more projects, such as the OMR120 million infrastructure works to evacuate the power from the power plants in Ibri and Sohar. Increasing our project delivery capability is essential in order to turn the high demand growth risk into investment opportunities. Basically, we need to engage more contractors, consultants and manufacturers in order to achieve that as well as enhancing our own investment management capabilities.
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“We used to operate high voltages of 132kV and 220kV but now we’re embarking on the construction of 400kV transmission system assets as it allows us to have more output capacity. As part of our vision we will be busy to complete the 400KV backbone for the whole of Oman. We have a vision to have one 400KV linking the North and South and the interior parts, so we will have one strong grid and solid infrastructure appearing over the next few years. We want to support overall growth within the country as best we can.”
OETC was established on 1 May 2005 and it is responsible for the building and operating of the transmission network in Oman, and is the licensees under the authority of Government of Oman. It is also in charge of despatching and controlling the overall generation and output of electricity in the country.
In January 2014 OETC took control of the transmission network in the south of Oman, which had previously been operated by a different system operator. As a result the firm had full control of the country’s electricity transmission and a significant platform to build on.
Eng Ali Al-Hadabi, CEO of Oman Electricity Transmission Company, said: “We are also responsible for the international connection to a number of GCC countries and its authorities, this is done through Abu Dhabi in the UAE. Meanwhile we have a number of high-profile corporate customers in Oman connected to the high voltage network; the major Omani airports, industrial customers such as steel and aluminium factories, and the Oman Petroleum Company to name a few.”
“Because we are experiencing a lot of growth in OETC and the country as a whole, we need to maintain the same sort of growth in the network to handle the load increase and ensure we all flourish.”
OETC has also made sure all IT systems have been upgraded to help drive continuous improvement and support the national controlling and communication link to the national network.
Al-Hadabi and Al-Busaidi both stressed the need for new ways to strategically deliver projects, because despite the heavy investment throughout the group, if the assets are not managed correctly then it will not have the desired impact on operations.
Al-Hadabi said: “In the last two or three years we have established a strong asset management structure. We do depend on outsourcing a small amount for things like consultancy who supervise our work and make sure we carry on looking after the projects that are coming our way.
“This new strategy will really help us to see the requirement of all departments and see the lifecycle of our assets. This relates back to our investment program where we are ensuring there is a sufficient support network in place.
“We would also like to emphasise the value we place on our excellent staff and engineers. We take them through rigorous and high-quality training which allows them to look after what we are targeting. We encourage all our engineers to go for extra qualifications and support them; a fulfilled worker is much better equipped to help us achieve our business objectives.”
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More than 92 percent of the company’s employees are Omani nationals and most are trained in multiple disciplines. “We want this trend to continue because we believe in the young talent in this country, and hope they will want to work for an employer like OETC. We also want to limit the amount of outsource activity to certain niche tasks that physically cannot be done in-house; everything else should be done in-house going forward. With this in mind, staff numbers are expected to increase in the coming years.” added Al-Hadabi. OETC has made a successful habit out of building fruitful partner relationships with local service providers and contractors too, and this has further helped maintenance and delivery.
The company management team sees the main challenge going forward as the ongoing efforts to improve the national grid infrastructure. Building a transmission network with high voltages of 400KV is a sizeable job, in terms of implementing new overhead lines, underground cables and evacuating the power from the new generation stations.
While this is being carried out all network corridors need to remain available at all times as it is important OETC maintains a reliable service to the customer with no deviation in quality or availability.
Al-Hadabi concluded: “We need to execute all these new lines and substations with minimum to the end users, our valued customers, and this is something we are taking very seriously with the governmental authorities and that is the main challenge I can see, we need to tackle that to get the right corridors and build a service fit for the future.
“We are always benchmarking ourselves against the best transmission companies across the world and we try to be constantly challenging ourselves to be the best utilities firm we can be. When we do reports based on our three pillars of reliability, availability and quality we always find the results to be acceptable. But we must not be complacent and stand still.
“We have high standards and have put a big level of expectation of ourselves, and we challenge our employees to make sure we deliver on that expectation.”
With such commitment to its staff, coupled with significant investment plans, the Oman Electricity Transmission Company looks set to bring about further prosperity for itself and facilitate growth for the country’s economy.
Ofwat allows retailers to raise prices from April
Retailers can recover a portion of excess bad debt by temporarily increasing prices from April 2022, according to an Ofwat statement.
The regulator confirmed its view that levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue, thereby allowing "a temporary increase" in the maximum prices. Adjustments to price caps will apply for a minimum of two years to reduce the step changes in price that customers might experience.
Measures introduced since March 2020 to contain the spread of Covid-19 could lead to retailers facing higher levels of customer bad debt. Retailers’ abilities to respond to this are expected to be constrained by Ofwat strengthening protections for non-household customers during Covid-19 and the presence of price caps.
In April last year, Ofwat committed to provide additional regulatory protection if bad debt costs across the market exceeded 2% of non-household revenue.
Georgina Mills, Business Retail Market Director at Ofwat said: “These decisions aim to protect the interests of non-household customers in the short and longer term, including from the risk of systemic Retailer failure as the business retail market continues to feel the impacts of COVID-19. By implementing market-wide adjustments to price caps, we aim to minimise any additional costs for customers in the shorter term by promoting efficiency and supporting competition.”
There are also three areas where Ofwat has not reached definitive conclusions and is seeking further evidence and views from stakeholders:
- Pooling excess bad debt costs – Ofwat proposes that the recovery of excess bad debt costs is pooled across all non-household customers, via a uniform uplift to price caps.
- Keeping open the option of not pursuing a true up – For example if outturn bad debt costs are not materially higher than the 2% threshold.
- Undertaking the true up – If a 'true up' is required, Ofwat has set out how it expects this to work in practice.
Further consultation on the proposed adjustments to REC price caps can be expected by December.
"While it’s great that regulators are helping the industry deal with bad debt in the wake of the pandemic, raising prices only treats the symptoms. Instead, water companies should head upstream, using customer data to identify and rectify the causes of bad debt, stop it at source and help prevent it from occurring in the first place," she said.
"While recouping costs is a must, water companies shouldn’t just rely on the regulator. Data can help companies segment customers, identify and assist customers that are struggling financially, avoiding penalising the entire customer in tackling the cause of the issue."
United Utilities picks up pipeline award
A race-against-time plumbing job to connect four huge water pipes into the large Haweswater Aqueduct in Cumbria saw United Utilities awarded Utility Project of the Year by Pipeline Industries Guild.
The Hallbank project, near Kendal, was completed within a tight eight-day deadline, in a storm and during the second COVID lockdown last November – and with three hours to spare. Principal construction manager John Dawson said the project helped boost the resilience of water supplies across the North West.
“I think what made us stand out was the scale, the use of future technology and the fact that we were really just one team, working collaboratively for a common goal," he said.
Camus Energy secures $16m funding
Camus Energy, which provides advanced grid management technology, has secured $16 million in a Series A round, led by Park West Asset Management and joined by Congruent Ventures, Wave Capital and other investors, including an investor-owned utility. Camus will leverage the operating capital to expand its grid management software platform to meet growing demand from utilities across North America.
As local utilities look to save money and increase their use of clean energy by tapping into low-cost and low-carbon local resources, Camus' grid management platform provides connectivity between the utility's operations team, its grid-connected equipment and customer devices.