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Official says Oman may cut power subsidy by 8%

The Sultanate, which paid $1.17bn in electricity subsidies last year, could increase electricity tariffs in a move likely to impact commercial and industrial end-users

Oman's electricity subsidy cut could impact commercial, industrial, and government end-users.
Oman's electricity subsidy cut could impact commercial, industrial, and government end-users.

A cabinet proposal could see Oman slashing electricity subsidies by between 7% and 8%, a senior official said.  

The change in electricity fees is aimed at increasing government revenues. 

If approved, then the subsidy cut could result in significant savings for the government, which paid $1.17bn (OMR450m) in electricity subsidies last year.

Qais al-Zakwani, executive director of the Authority for Electricity Regulation, told Reuters that the proposed change would affect commercial, industrial, and government users of electricity consuming over 150 megawatt (MW) hours annually.

This amounts to between 9,000 and 9,5000 consumers.

Zakwani said the government also sells natural gas for power generation at a subsidised rate, adding end-users of electricity in the Sultanate are "only paying about half of the cost of generating it". 

"We have started talking to the targeted segments, and they are happy with the idea of adjusting operating timings from peak hours to hours with less electricity consumption, where they will pay less than the current flat rates," he continued. 

"We are only waiting for the green light from the council of ministers to start changing electricity meters." 

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