In the application of the provisions of this Law the following expressions and words shall have the meanings assigned to each of them unless the context otherwise requires:

The Authority the electricity and Related Water sector Authority established pursuant to Article (19) of this Law;

Competent Authority any unit of the State Administrative Apparatus, and what is considered as such, and the branches and divisions related thereto, which have been assigned with any jurisdiction pursuant to this Law;

Cost-Reflective Tariff amounts charged by the Licensed Transmission System Operator and the Licensed Distribution System Operator in consideration for Connection and use of their Systems, and amounts charged by a Licensed Supplier in consideration for Supply where, all being in cases, no Permitted Tariff exists, and such tariff shall be calculated in respect of each calendar year on the basis and rules prescribed by the Authority;

Customer a Person who is Supplied with electricity at Premises for consumption at those Premises;

Licence a written authorization issued by the Authority to undertake any of the regulated activities pursuant to the provisions of this Law;w;

Exemption a written authorization issued by the Authority to undertake any of the regulated activities pursuant to the provisions of this Law without obtaining a Licence or Exemption from one or more conditions of a Licence;

Distribution System electrical lines and installation of less than 132kV used for the distribution of electricity to any Premises, which are not part of a Transmission System;

Export electricity, Generated in the Sultanate of Oman and which is exported from the Sultanate of Oman pursuant to a legal transaction in accordance with the provisions of this Law;

Generation the production of electricity by any manner;

Distribution the transport of electricity by means of a Distribution System;

Desalination    the production of demineralised and/or potable water by desalination;

Distribution Licence an authorization to undertake the activity of electricity Distribution;

Generation Licence authorization to undertake the activity of electricity Generation and operation of Production Facilities;

Supply Licence authorization to undertake the activity of electricity Supply;

Supply the supply of electricity to any Premises;

Generation/Desalination Licence an authorization to undertake the activity of electricity Generation combined or co-located with the Desalination of water at the same location;

Eligible for Connection Premises not Connected at the relevant time, which according to Article (85) of this Law are within the class of Premises, which are required to be Connected by a Licensed Distribution System Operator or a Licensed Transmission System Operator;

Electric Plant any installations, equipment or appliances used for the Generation, Transmission, Dispatch, Distribution or Supply of electricity, or for purposes connected with the above, other than a meter used for identifying the quantity of electricity Supplied to Premises, or any electrical appliance under the control of a Customer;

Bulk Supply the bulk supply of electricity to any Licensed Supplier, or desalinated water to the Water Department, or the bulk supply of demineralised water to other Persons;

Connected any Premises or System, connected by any means of electrical connection for Transmission, Distribution or Supply of electricity between those Premises or that System and a Transmission System or Distribution System other than a Transmission System or Distribution System owned or operated by the Rural Areas Electricity Company;

Import electricity which is Generated outside the Sultanate of Oman and imported into the Sultanate of Oman pursuant to a legal transaction in accordance with the provisions of this Law;

Production Capacity electricity Generation capacity or electricity Generation capacity combined or co-located with water Desalination capacity in the same site, as the context so requires;

Dispatch the manner by which instructions are determined and issued to Licensed Generators or Licensed Generators/Desalinators as to the operation or cessation of operation of their Production Facilities or to other Persons whose facilities are Connected;

Authorised Area a geographical area specified in the Licence within which a Licensee is authorized to undertake any of the regulated activities stipulated in this Law;

Transfer the transfer of any or all of the assets and liabilities from the Ministry of Housing, Electricity and Water to a Successor Entity in the manner specified in the Transfer Scheme;

Transfer Date the date fixed for the enforcement of the Transfer Scheme;

Successor Entity any Person to which Transfer is affected in accordance with the Transfer Scheme and shall include the companies stipulated in Article (66) of this Law;

System a Distribution System or a Transmission System, as the context requires;

Street-works any kind of works conducted under, over, across or above any highway;

Self Supply the Supply by a Person of electricity to himself, his employees or commercial business, other than via a Transmission System or a Distribution System of a Licence Holder;

Related Water Desalinated water in the Sultanate of Oman which is combined or co-located with the electricity sector and which is subject to regulation in accordance with this Law;

Relevant Assets and Liabilities all of the physical assets, contracts, rights and liabilities of the Ministry of Housing, Electricity and Water on the Transfer Date including the contracts of employment of Transferring Employees and other employees which are used for the purpose of, or in connection with the Generation, Transmission, Dispatch, Distribution, or Supply of electricity, or Related Water, but shall not include matters relating to the purpose of Housing or non-related water;

RAEC Connections a physical connection existing between any Premises or System and a System owned or operated by the Rural Areas Electricity Company;

RAEC Connection and Electrification Funding    the funding provided by the Government for RAEC Connections, expansion of the Systems of the Rural Areas Electricity Company and electrification of Rural Premises;

Premises any plot of land, building, or structures occupied or used by any Person;

Permitted Tariff the tariff a Customer is obliged to pay in consideration for Supply of electricity or for Connection to a Distribution System or a Transmission System, which tariff shall be determined in the manner stipulated in Article (9) of this Law;

Person any natural person or public or private legal person, corporations or societies or organisations;

Output electricity Generated and/or water Desalinated by a Production Facility;

Merit Order an order for ranking available Production Facilities aiming at the achievement of optimal economy, security, and stability for the Total System and Desalinated water capacity determined by each Licensed Transmission System Operator in accordance with the Transmission Licence issued to them;

Water Equipment any installations, water mains, and other water installations forming part of a Production Facility;

Transferring Employee each Omani employee working in the service of the Ministry of Housing, Electricity and Water on the date preceding the Transfer Date to be Transferred to any Successor Entity pursuant to the Transfer Scheme;

Transfer Scheme the scheme determined, implemented and modified by the Ministry of National Economy in accordance with the provisions of this Law, for the purposes of Transfer to the Successor Entity;

Transmission the transport of electricity by means of a Transmission System;

Transmission Licence an authorization to undertake the activity of electricity Transmission;

Transmission System lines and electrical installations, with voltage equal to or greater than 132kV used for transporting electricity from a Production Facility to sub-stations, or from Production Facilities to other Production Facilities, or from sub-stations to other sub-stations, or to or from any Interconnector, Premises, or Distribution System and any Electric Plant used for the purposes of Dispatch;

Electric Line any line, whether underground or overground, which is used to transport or Distribute electricity for any purpose and includes, unless the context otherwise requires:

(a) Any support for any such line, including any structure, pole, pylon or other thing in, on, by or from which any such line is supported, carried or suspended;

(b) Any apparatus connected to any such line for the purpose of carrying or Distributing electricity;

(c) Any wire, cable, tube, pipe or other similar thing (including its casing, insulator or coating) which surrounds or supports any such line, or is surrounded or supported by, carried or suspended, in association with, any such line.

RAEC System a Transmission System or a Distribution System owned and operated by the Rural Areas Electricity Company;

Total System the entire interconnected electricity Systems of Licensees, including all Production Facilities and all Transmission Systems as the same may be modified or developed, and any System that interconnects with another System, within or outside the Sultanate of Oman;

Bulk Supply Tariff the consideration charged by the Oman Power and Water Procurement Company for the Bulk Supply of electricity, or the tariffs charged by each of the Rural Areas Electricity Company and the Oman Power and Water Procurement Company for the Bulk Supply of Desalinated water, which shall be calculated in respect of each calendar year on the basis prescribed by the Authority and be provided for in the Licence granted to any of such companies;

Production Facility installations used for the Generation of electricity or the Generation of electricity combined or co-located with the Desalination of water in the same site, including all associated Electric Lines, Electric Plant and Water Equipment;

Performance Security Standards the standards by which a Licensee's performance in maintaining generation security and/or the availability and quality of a System or services, may be measured, in the manner prescribed in its Licence;

Economic Purchase procurement of all required goods and services on the best economic terms taking into account quality, quantity, the nature of the items intended to be purchased, the available manner of delivery and the future security, reliability and diversity of supply of the items to be purchased;

Ancillary Services services which Licensed Generators, Licensed Generators/Desalinators or other Persons connected to a Transmission System or Distribution System may be required to provide in connection with the security and stability of such Transmission System or the Total System, whether by an agreement to be concluded between a Licensed Transmission System Operator or a Licensed Distribution System Operator and any Person, or an agreement between a Licensed Generator or a Licensed Generator/Desalinator and the Oman Power and Water Procurement Company;

Autogenerator a Person who generates electricity for the purposes of Self-Supply;

Distribution Code the rules which each Licensed Distribution System Operator is obliged to prepare and maintain after the approval of the Authority, which shall include standard technical criteria to be complied with in respect of Connection to the System of such Licensee, and in relation to the use and operation of such System, and shall also include the relevant criteria for the maintenance and development of the abovementioned System, all being in accordance with the Licence;

Grid Code the rules which each Licensed Transmission System Operator shall prepare and maintain after the approval of the Authority, and shall include standard technical criteria to be complied with in respect of Connection to the System of such Licensee, and in relation to the use and operation of the above mentioned System and in respect of Dispatch, in addition to the relevant matters relating to the Total System, all being pursuant to the Licence;

New Capacity the Production Capacity, which is not subject to a contract between its owner and the Oman Power and Water Procurement Company;

RAEC Code the rules which the Rural Areas Electricity Company shall prepare, implement and maintain, after the approval of the Authority, and shall include the standard technical criteria to be complied with in respect of RAEC Connection, the use, operation and development of any RAEC System, pursuant to the Licence;

Appropriate Person a Person who has the technical and financial abilities and is otherwise qualified to obtain a Licence or Exemption;

Employment Rights the rights of Transferring Employees from the Ministry of Housing, Electricity and Water, for financial dues and other rights relating to employment, including all rights actually accrued;

Forward Work Programme the programme prepared and published by the Authority before the beginning of each financial year pursuant to Article (34) of this Law;

Industry Participant any Person undertaking a regulated activity;

Interconnector facilities, which Connect two Systems;

International Interconnector an Interconnector, which Connects a System, which exists within the Sultanate of Oman with a System, which existing outside the Sultanate of Oman;

Liberalisation of the Electricity Market one or more of the following:

(1)   The disposal by the Government of any economic interest in the Electricity Holding Company or the Oman Power and Water Procurement Company;

(2)   Permitting the sale by Licensed Generators and Licensed Generator/Desalinators of Output to any Person other than the Oman Power and Water Procurement Company;

(3)   Permitting the Import or Export of electricity by any Person other than the Oman Power and Water Procurement Company and the Rural Areas Electricity Company;

(4)   The creation of competition amongst Licensed Suppliers including those who are not also Licensed Distribution System Operators in relation to the Supply of electricity;

Rural Premises Premises, which are not Connected within the Authorised Area of the Rural Areas Electricity Company;

Appellant any Person who has the capacity and interest in Appealing against any decision, or action issued by the Authority, Government or any other Person pursuant to the provisions of this Law;

Appeal the manner prescribed to protect rights, and oblige with the duties and payment of compensation, and imposition of fines, and cancellation of any decision issued by any authority, or any Person authorized by Law with the specific jurisdiction, all of which may be subject to Appeal pursuant to this Law;

Arbitration an Appeal instituted by any Person who has the capacity and interest pursuant to this Law in any matters which may be referred to Arbitration or which are not within the jurisdiction of the Competent Omani Court pursuant to the provisions of this Law;

Value-test the equivalent to:

(a) 2% of the annual aggregate turnover in case of Appeals instituted by a Licence Holder or Exemption Holder;

(b) 2% of the total annual expected turnover in cases of Appeals instituted by any applicant for a Licence or Exemption.

Competent Omani Court the panel constituted by three judges of the Primary Court in Muscat assigned in accordance with the provisions of the Judiciary Law issued by the Royal Decree 90/1999 and as amended to dispose of commercial matters;

Water Department any major division or sub-division responsible for Related Water in the Ministry of Housing Electricity and Water, or any other Competent Authority;

Oman Electrical Standards the standards issued by the Ministry of Housing, Electricity and Water and the standards approved, reviewed and modified from time to time by electricity regulations made in accordance with Article (38) and Article (39) of this Law, in relation to the safety of equipment and electrical Systems and procedures associated with the operation of electrical Systems;

Wholly-owned by the Government in relation to any company, that all of the issued shares in that company are owned by the Ministry of Finance or the Electricity Holding Company or by other nominees of the Government or by any entity Wholly-owned by the Government.

The term ‘Project Agreements’ shall have the same meaning assigned to it  pursuant to article 1 of the Law granting the abovementioned Salalah Concession, also the words and expressions used in this Law relating to the Salalah Project Agreements shall have the same meanings assigned to them in the mentioned agreements, and also the words and expressions relating to the Manah Project Agreements shall have the same meanings given to them in those agreements.

It shall not be permissible for any Person to undertake any of the regulated activities stipulated in the preceding Article without obtaining a Licence or Exemption from the Authority, and the undertaking of the licensed activity shall be by the licensee in accordance with the terms, periods and rules contained in this law and pursuant to the contents of the Licence or Exemption.

The Authority after consultation with the Ministry of Housing, Electricity and Water may grant an Exemption to any Person undertaking or applying to undertake any of the regulated activities from obtaining a Licence or from some of the Licence conditions.

The Authority, pursuant to a reasoned decision, may refuse to grant a Licence or Exemption.

Save for the Rural Areas Electricity Company or a special provision to the same effect in this law, it is not permissible for any licensee to undertake more than one regulated activity or to acquire any direct or indirect economic interest in any other Licensee.

The Authority in performing its functions, exercising its powers, and discharging its duties prescribed in accordance with the provisions of this Law shall not violate any rights which have been determined pursuant to agreements concluded before the date of enforcement of this Law.

The Minister of Housing, Electricity and Water shall issue Permitted Tariff regulations which are to be implemented in the Sultanate of Oman including tariffs for Supply and Connection of electricity, and the use of the system of the Salalah Project Company, and such tariffs shall be published in the Official Gazette.

It shall not be permissible for any Person who undertakes Supply and Connection or any of them to obtain any amounts purported to be prescribed to a Permitted Tariff or a Cost-Reflective Tariff if that is not true.

The Ministry of National Economy shall be competent after coordinating with the Ministry of Finance to implement the policy of the government in relation to the privatisation of the electricity and Related Water sector in the Sultanate of Oman, and shall in particular have the power to do the following:
(a) To instruct the Electricity Holding Company whether by selling all or part of the shares owned by it locally or internationally in all or some of the companies stipulated in Article (66) of this Law or in other companies, or to oblige the companies referred to to transfer all or some of their assets, rights and liabilities, and
(b) Undertake all that is required for the privatisation of the electricity and the Related Water sector in the Sultanate of Oman to allow the private sector to construct, own, operate, maintain, finance or develop projects undertaking regulated activities pursuant to the provisions of this Law, and to invest in them.
All being in the manner determined by the Ministry of National Economy in accordance with the aforementioned.
 

Subject to the stipulations of Article (7) of this Law it is permissible for any Person to purchase shares in any of the companies stipulated in Article (66) of this Law and other companies operating in the electricity and/or Related Water sector except the Oman Power and Water Procurement Company which shall continue to be Wholly-owned by the Government.

As an exception from the provisions of paragraph (a) of article 2 of the abovementioned Foreign Capital Investment Law, non Omani shareholders in the companies undertaking regulated activities pursuant to the provisions of this Law may own 100 per cent of the shares of that company.

The Electricity Holding Company and all licensees who take the form of Omani companies established in accordance with the provisions of the abovementioned Commercial Companies Law, shall enjoy the taxation and customs treatment prescribed to Omani companies wholly owned by Omanis irrespective of foreign percentage participation, and without prejudice to taxation and custom exemptions prescribed before the commencement of this Law no tax exemption may be granted to any licensee.

The Ministry of Finance shall pay the value of the annual financial subsidy to Licensed Suppliers after the calculation of such subsidy in accordance with the following:
(a) The Authority shall assess the level of allowed revenue in the relevant year the earning of which was available to each Licensed Supplier where he has effectively discharged his obligations specified in this Law and his Licence;
(b) The Authority shall determine the value of revenue represented by the amounts, which have to be collected by the Licensed Supplier in the relevant year where he has effectively discharged his obligations specified in this Law and his Licence;
(c) The Authority shall calculate the difference between the assessments specified pursuant to paragraph (a) and (b) and approve such difference in its Annual Report, and if the assessed value pursuant to paragraph (b) (representing the revenue collected from customers and others) is less than the assessed value pursuant to paragraph (a) (representing the allowed revenue) the Ministry of Finance shall be obliged to pay such difference to the Licensed Supplier and this Ministry shall specify the time and the manner of such payment which shall be, at least, every three months during the relevant year;
(d) The Authority shall calculate any differences between the assessments being prepared for the preceding year and what has been actually available for collection by the licensee in such year in the light of relevant circumstances, and the Authority shall notify the Ministry Of Finance about the methodology of calculating the differences pursuant to the provisions of this Article and shall include such methodology in the Annual Report mentioned in Article (29) of this Law.