The cost of expanding and modernising Oman's water transmission infrastructure is projected at RO 2.9 billion over the next two decades, the Chairman of the Public Authority for Electricity and Water (PAEW) stated here yesterday.

Mohammed bin Abdullah al Mahrouqi said the average investment required to develop this key sector is estimated at RO 150 million per annum for the next 10 years, with the average falling to RO 100 million per annum thereafter.

“This (estimate) is only for the water transmission networks, with the investment for water desalination capacity expected to come from the private sector,” Al Mahrouqi added in comments to journalists on Day 2 of the Oman Power and Water Summit under way at the Grand Hyatt Muscat.

Earlier, in a keynote address to delegates attending the annual Summit, Al Mahrouqi said the Authority has embarked on a long-term strategy to develop and augment the nation’s vital water transmission sector.

“In the last year, we have been engaged in developing a comprehensive long-term master-plan for our investment in water transmission networks. This is based on the latest information on population growth from the recent census and also the results of a major water security study we conducted in 2010.

The master-plan identifies the investments needed over the next 20 years or so, to improve security and expand network coverage throughout our service area. Our current view is that our major programme of network investment will continue at about 1.5 times its historic rate for the foreseeable years and we are gearing up our internal resources to manage this challenging programme,” the Chairman said.

Growth in water demand has remained high in trend with population growth, necessitating continued investments in extending network coverage to small communities, Al Mahrouqi said. In 2010, water supply grew by around 18 per cent, with peak demand rising at a similar rate, he noted.

Future demand growth in the water sector, the Chairman said, is proposed to be met through a number of new Independent Water Projects (IWPs), which will be developed with private investment.

At Ghubra in Muscat Governorate, a competitive process is under way for the procurement of a 42 million imperial gallons per day (MIGD) capacity IWP. This new plant represents the first phase of a plan to replace aging desalination capacity at the existing Al Ghubrah Power & Desalination Plant, he said.

The PAEW is also preparing a tender for a water treatment plant and related water transmission networks to move water from the newly built Wadi Dayqah Dam in Wilayat Qurayat to consumers in Bausher, Al Amerat and Qurayat, Al Mahrouqi said.

Also on the anvil are two new IWPs planned at Qurayat and Suwaiq with an aggregate desalination capacity of around 400,000 cubic metres per day. Site selection studies are under way for both projects, which will be procured over the next five years or so, he said.

On the electricity front, demand growth is projected at an average of eight per cent annually, the Chairman stated. “Growth has escalated rapidly over the last decade and continues to grow strongly particularly in the industrial, tourism and infrastructure sectors despite a worldwide slowdown. This economic growth has been combined by a substantial increase in demand for both electricity and water across the whole of the Sultanate. The average annual electricity consumption last year was 12 per cent, which is more than the typical of recent years following more modest growth in 2010. Underlying demand is expected to continue to grow by about 8 per cent a year for the foreseeable future,” he said.

The biggest driver of electricity demand growth has been for residential consumption, which accounted for 49 per cent of total demand in 2011. The commercial sector came next with 20 per cent. Other major consumer segments are: government — 15 per cent, industry 14 per cent, agriculture and fisheries — around 1 per cent, and tourism — less than 1 per cent.

Between 2010 and 2011, total electricity consumption in Oman grew by 14 per cent.
In addition to focusing on demand side management and efficiency in conservation, the Authority is also exploring the potential for renewable energy, he said. “We are working to develop a master-plan for energy efficiency in the Sultanate and we will need to develop policy on this aspect in co-ordination with key stakeholders.

For renewables, PAEW’s strategy for harnessing renewable energy in Oman is envisaged to have three elements: developing policy to encourage wide-scale application of renewables, implementing a number of projects to improve the learning curve, and building local capacity in key areas to allow development of a sustainable local renewable energy industry.”