Bioenergy Use in Lao PDR

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1 Regional workshop on Sustainable Bioenergy Production and Use in Southeast Asia: Lessons Learnt and Future Opportunities Bioenergy Use in Lao PDR PHONEPASONG SITHIDETH Institutes of Renewable Energy Promotion November 2017 La Casa Hotel Hanoi Viet Nam

2 CONTENTS I. Introduction II. Overview on Energy Consumption III. Renewable Energy RE Current Status IV. Challenge V. Conclusions

3 Introduction Area : 236,800 km 2 Capital: Vientiane Population 2015 Total 6.5 millions Density 27 person/km 2 Total Share of GDP 2015 GDP per Capita 1,947 US$ Growth rate of GDP: 7.56% Share of GDP 2015 Agricultural: 21.80% Industry: 32.70% Services: 35.95% Taxes on products and Import duties, net: 9.55%

4 Power potential in Lao PDR HYDRO POWER POTENTIAL OF ABOUT 26,000 MW. Small Hydro Power 15 MW: 2,000 MW Solar: irradiation kwh/m 2 ( hrs/y) Biomass > 938 MW Biogas >313 MW Wind 182,000 MW, very good 2,800 MW o 600 MW (phase 1: 250MW; phase 2: 350 MW) under negotiation for development in Sekong Prov.

5 Power Generation Share Power Generation Share (MW) Biogas 0% Solar 0% POWER GENERATION SHARE [%] Biomass 1% Coal 20% 79% - Total Install Capacity 6,264.9 MW [November 2016]

6 II. Overview of Energy Consumption Energy Consumption (2014): 2,510 KTOE ENERGY CONSUMPTION BY TYPES ENERGY CONSUMPTION BY SECTORS Fuel Oil, 32.70% Fuelwood, 49.10% Transportati on, 31.30% Residential, 47.40% Electricity, 12.60% Charcoal, 5.40% Coal, 0.20% Commercial, 12.30% Industrial, 8% Agriculture, 1% Primary Energy Consumption in Lao PDR by 2014 (MEM)

7 Main target on Energy Sector Lao PDR is 94% electrified Promote Energy Efficiency and Conservation (EE&C) by Reduce 10% of energy consumption in 2030 Provide clean energy to sustain economic growth and Poverty alleviation Increase power Export for revenue earning Expand access to electricity services up to 95% of households by 2020 Increase Renewable Energy (RE) use to 30 % of national energy consumption by 2025

8 Renewable Energy Policy and Strategy Objective: Ensure energy security, sustain socio-economic development, and enhance environmental and social sustainability Financial Incentive for Investors Renewable Energy Strategy Development ( ) Develop and Modify Legal documents (laws, regulations and guidelines) Target: increase RE use to 30 % of national demand by 2025 (bio-fuel production to account 10 %) Bio-Energy Wind 73 MW Solar 106 MW SHP 400 MW For Electricity Biomass Biogas Waste 58 MW 51 MW 36 MW Heat Biomass Biogas 113 ktoe 178 ktoe Biofuels (ML) Ethanol Biodiesel Support Mechanism Establish Renewable Energy Fund Financial Mechanism: - Import duty free on production machinery, equipment and raw materials - Import duty free on chemical materials necessary for biofuels production within 7 years - Profit tax is divided in to 3 categories: 20%, 15% and 10%. Profit tax exemption is possible for a certain period depending on activities, investment areas and size investment Subsidies on unit product price depending on energy type and times period

9 Trend of Total Energy Demand ທ າອ ຽງໃນຄວາມຕ ອງການຊ ມໃຊ ພະລ ງງານສາເລ ດຮ ບ, ktoe 6, ,000.0 ອ ດສາຫະກາ ຂ ນສ ງ ທ ລະກ ດ ທຢ ອາໄສ ສະຖ ຕ ໃນໄລຍະຜ ານມາ Existing statistic ກະສ ກາ 5,600 ktoe ການຄາດຄະເນ Future predict Agriculture 4, , ,510 ktoe Residential 2,000.0 Business 1,000.0 Transport 0.0 Industrial

10 CURRENT STATUS OF BIOMASS DEVELOPMENT Sun paper holding Phin, district Savannakhet Province Install Capacity: 60 MW Feedstock: Industrial Waste Hoang Anh Sugar Mill Phouvong, district Attapeu Province Install Capacity: 30 MW Feedstock: Bagasse Mit Lao Sugar Mill Xaibury, district Savannakhet Province Install Capacity: 9.7 MW Feedstock: Bagasse

11 Biomass consumption Commercial, 14.50% FUELWOOD Industrial, 4.30% Charcoal Residential 49% Commercial 51% Residential, 81.20%

12 Using Biomass and agri-waste for energy Institution cooking Salt production factory Source: Mr. Houmpheng THEUAMBOUNMY (MOST) Firewood fuel in alcohol distillation

13 Using Biomass and agri-waste for energy Rice husk stove for salt production Saw dust stove for salt production Rice husk stove for institution Corn cobs as fuel in corn drying factory Source: Mr. Houmpheng THEUAMBOUNMY (MOST)

14 CURRENT STATUS OF BIOGAS DEVELOPMENT 60,000 50,000 40,000 50,000 Biogas Project/ DFL (MAF) 5,003 HHs in Year ,000 25,000 20,000 10,000 5,003 2, Existing Household with biogas Target houusehold for biogas utilization (MW) 51 Target UD Pig Farm 260 kw Phohong District Vientiane Province Pig Farm Viravong. 30 kw Viengkam District Vientiane Beer Brewery Waste water treatment from beer production and generate the gas about 1,500 m3/day Reduce CO2 about 3,338 ton/y

15 BIOFUEL DEVELOPMENT Plantation-Area Palm oil Harvest-Area ha 60 ha (2016) FFB CPO B ,640 kg 33,000 L 20,000 L Biodiesel Plant: 20,000 L/day Extraction Plant: 20 tons/day Vernicia Montana 12,350 3,000 ha Fruit collection B100 75,000 kg 18,000 L Biodiesel Plant: 1,000 L/day Extraction Plant: 2 tons/day In 2017 new Plant 2 units; Each unit 15 t/day B100 18,000 L Lao-Agrotech Co., Ltd Naxaythong, district Vientiane Capital Ethanol Pilot project Biodiesel-Makao Oil Lao Co., Ltd Luangprabang, district Luangprabang Province Bio ethanol: June 2014 (IREP cooperation with UNIDO? The GOL signed MOU with 2 local private company to conduct feasibility study of bio ethanol production from cassava (each 200,000 L/day)

16 Future Opportunities Lao import 100% of oil for transport sector GOL set target to reduce oil import 10% in 2025 Lao is agriculture country Renewable Energy and Energy Efficiency-Conservation Environment Impact Mitigation

17 Challenges Bioenergy Development Plan All relates technologies are import Limited of domestic financial institution support Biomass resource location far each other Human resource

18 Conclusion Improvement of Data collection in provincial level Master plan Bioenergy Subsidies on unit product price (adder or FIT) Carry out resource assessment to estimate potential Knowledge and Information sharing Conduct demonstration project, especially bioenergy

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