Electricity tariffs based on long-run marginal costs for central grid system of Oman

Arif S. Malik and Salem Al-Zubeidi

Energy, 2006, vol. 31, issue 12, 1703-1714

Abstract: The electricity tariffs in Oman are subsidized and are based on a cost accounting approach and do not reflect the true cost incurred in generating, transmitting and distributing a kilowatt-hour of electricity at the consumer end. This paper presents the electricity tariff based on the estimation of long-run marginal cost at generation, 33kV, and 415 voltage level for Ministry of Housing, Electricity & Water (MHEW) interconnected power system of Oman. The result shows that at the generation level a marginal kW costs US$ 75per year and a marginal kWh costs 2.07¢/kWh. These costs increase as we move downstream from generation to consumer end. The average cost of electricity at the consumer end connected at 415V is 6.52¢/kWh or 25.17Bz/kWh.

Keywords: Long-run marginal cost; Electricity tariffs; Power planning (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:31:y:2006:i:12:p:1703-1714

DOI: 10.1016/j.energy.2005.11.010

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