Dr. Jyoti Parikh Executive Director Integrated Research and Action for Development (IRADe)

Transcription

1 South Asia Investor s Workshop on Cross-Border Electricity Trade South Asia Regional Initiative for Energy Integration(SARI/EI) 24 th -25 th September, 2014 New Delhi, India Dr. Jyoti Parikh Executive Director Integrated Research and Action for Development (IRADe)

2 IRADe, a think tank set up in 2002 About IRADe Conducts multi disciplinary research and policy analysis Multi stakeholders problems and approaches involving government, nongovernmental organizations, corporations, academia and financial institutions. Engages in national and international dialogue for consensus building Key Thematic Areas Urban Infrastructure & Services Climate Change & Environment Energy & Power Systems Poverty Alleviation & Gender Agriculture & Food Security

3 Integrated Research and Action for Development (IRADe) Regional Think Tank that works with Action Tanks! KEY ACTIVITIES Multi-disciplinary and Multi-stakeholders engagement. Research and analysis for decision support Research in action, monitoring and evaluation of projects Trainings and Capacity Building Policy analysis and Dissemination

4 SARI/EI promotes regional integration of Energy Systems. SARI/EI participating countries- Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka. IRADe is the implementing partner for the fourth phase ( ) of SARI/EI program through a cooperative agreement with U.S. Agency for International Development (USAID). Focus is on a demand driven bottom up development paradigm specific for cross-border power project development.

5 SARI/EI Framework Project Steering Committee (PSC) Highly Consultative & Participatory Approach TASK FORCE -1 Coordination of Policy, Legal and Regulatory Framework TASK FORCE-2 Advancement of Transmission Systems Interconnection TASK FORCE-3 South Asia Regional Electricity Markets

6 SARI/EI Framework PSC Project Steering Committee Apex body that provides overall strategic direction and support for SARI/EI program PSC member includes: Senior level officials from respective South Asia country governments Representatives of regional institutions (e.g. SAARC Energy Centre) Representatives of multilateral donors (e.g. ADB and World Bank) Independent Energy Experts/Diplomats TASK FORCE -1 TASK FORCE-2 TASK FORCE-3 Task Forces Includes regional stakeholder representatives (such as national governments, electricity utilities, regulatory commissions, power market institutions, etc) Task force meetings: Follow highly structured, consultative, participative and demand-driven approach Pave way for identifying needs for technical analysis, research and studies

7 Hydro Electric Potential in South Asia (in GW) Afghanistan 25 Bhutan 30 Sri Lanka 2 Bangladesh 0.3 Pakistan 59 India 150 Nepal 83 Total Hydro Electric Potential of around 350 GW

8 Opportunities for CBET in South Asia due to Diversity in Demand & Supply Demand Side Supply Side Peak time differences Difference in time zones (15 to 30 minutes) Difference in daily load curve Difference in weekends and annual festivals Seasonal differences Sufficient to excess hydro capacity during monsoon Need of thermal support during lean period (dry season) Hydro thermal mix Optimal hydro thermal mix- better load balancing during peak and off- peak load

9 Benefits of Cross-Border Electricity Trade Technical and Operational Benefits Energy security due to large trade possibilities Diversified generation mix Reduction in Load Shedding Reduction in spinning reserves Efficient management of peak energy deficit Improved system reliability Economic and Financial Benefits Power availability at competitive price High export income Avoided generation capacity and T&D infrastructure Less exposure to volatile international energy prices Reduction in Current Account Deficit Environmental Benefits Reduction in CO 2 emissions Less Impact on Local and Global environment Renewable Energy Development Improvement in Social Indicators

10 Current Status of Power Sector Cooperation in South Asia S. No. Countries Interconnection Description Capacity (MW) Status 1 Bhutan -India 2 Nepal -India 3 4 Sri Lanka- India Bangladesh- India 5 India-Pakistan Grid reinforcement to evacuate power from Punatsangchhu I & II Dhalkebar-Muzaffarpur 400 kv line 400kV, 127 km HVDC line with submarine cable 400kV HVDC back-to-back asynchronous link 220 kv in the short-term (could be upgraded to 400 kv later) Reinforcement of 2,100 MW 1,000 MW 500 MW in the short-term Under Implementation Under Implementation Planning 500 MW Completed MW Yet to be formally discussed

11 SARI/EI TRACK 2 STUDIES Economic Benefits of CBET to Bhutan and Nepal

12 Methodology Assessment of electricity balance i.e. surplus or deficit situation for Bhutan and Nepal is undertaken for projecting economic benefit from Cross Border Electricity Trade between India and Bhutan, and India and Nepal Electricity Demand Forecast up to 2050 Surplus/ Deficit Forecast IRADe Activity Analysis Model Electricity Generation Forecast up to 2050 In the current work we only consider one way input from Nepal & Bhutan to India through higher importable surplus generation, thus this is still a partial analysis.

13 Methodology- Electricity Demand Forecast Data Collection Analysis Forecast Past Electricity Demand and forecast Population trend and forecast GDP trend and forecast For Bhutan: Using time series regression analysis For Nepal: Using NEA s demand forecast growth rate Methodology- Electricity Supply Forecast Data Collection and Analysis Phase Forecast Capacity Addition Plans Plans and policy for capacity additions Targets achieved against planned capacity additions Generation Potential Past generation trend and PLF Generation Projection Year wise electricity generation based on : Assumed PLF Upcoming generation capacities Data Source: Ministry and Govt. bodies reports for Bhutan and Nepal United Nations Population Prospects United Nations Statistics Database Presentations of various Ministry representatives of

14 Bhutan Electricity Demand-Supply Analysis up to 2050 Existing installed hydro capacity: 1,488 MW Key Assumptions: Supply Side o Exports surplus electricity after meeting domestic requirement o Target of installed hydro capacity of 26,534 MW to be achieved by 2035 (capacity target as per government s NTGMP 2012) o PLF for Hydro power generation assumed to be 53% Demand Side o Population: as per UN World Population Prospects Population in 2010: 7.2 Lakhs Population in 2050: 9.8 Lakhs o Observed GDP growth of 8.2% (period )

15 In Billion Unit Electricity Demand-Supply Forecast up to Bhutan Electricity Surplus (in BU) Electricity Demand (in BU) Electricity Generation (in BU)

16 In Billion BTN Electricity Export earnings per capita in BTN Annual Gains from Electricity Export- Bhutan Assumption: Export of electricity to India at BTN 3 per kwh. 1 INR = 1 BTN , , , , , , , , , , , , ,000 60,000 10, ,000 Annual Electricity Export Earnings in Billion BTN Electricity Export Earnings per Capita in BTN (on secondary axis)

17 In percentage Electricity Export Revenue share in GDP (at 2005 constant price)- Bhutan 1 INR = 1 BTN Assumptions: Growth rate for GDP: 8.2% (observed during period: ) Average electricity export price for year 2005: BTN 2 per kwh 70% 60% 59% 57% 56% 50% 40% 30% 20% 10% 32% 36% 22% 12% 0% Share of Electricity Exports in Total GDP

18 In Billion BTN Impact of Delay in CBET- 5 Year Delay Scenario for Bhutan Cumulative Electricity Export Earnings 1 INR = 1 BTN Loss of 1,800 Billion BTN Cumulative Electricity Export Earnings- Base Case Cumulative Electricity Export Earnings- Delay Case

19 Nepal Electricity Demand-Supply Analysis up to 2050 Existing installed capacity: 770 MW Key Assumptions: Supply Side o Exports surplus electricity after meeting domestic requirement o Target of 37,628 MW hydro capacity addition to be achieved by 2034 (capacity target as per 20 year Hydro Development Plan, 2009) o PLF for Hydro power generation assumed to be 54.4 % Demand Side o Demand grows at a CAGR of 8.1% (as per NEA Annual Report)

20 In Billion Unit Electricity Demand Supply Forecast up to Nepal Deficit of 1.3 BU Electricity Surplus (in BU) Electricity Generation (in BU) Electricity Demand (in BU)

21 In Billion NPR Electricity Export earnings per capita in NPR , Annual Gains from Electricity Export- Nepal Assumption: Export of electricity to India at NPR 4.8 per kwh (INR 3 per kwh). 11, , ,628 20, , INR = 1.60 NPR 20,000 15,146 15, ,000 5,000 0 Annual Electricity Export Earnings in Billion NPR Electricity Export Earnings per Capita in NPR (on secondary axis)

22 In percentage Electricity Export Revenue share in GDP (at 2005 constant price)- Nepal 1 INR = 1.60 NPR Assumptions: Growth rate for GDP: 8.2% (observed during period: ) Average electricity export price for year 2005: NPR 5.21 per kwh 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 36% 38% 29% 30% 23% 15% 11% Share of Electricty Export Revenue in Total GDP

23 In Billion NPR Impact of Delay in CBET- 5 Year Delay Scenario for Nepal 1 INR = 1.60 NPR Cumulative Electricity Export Earnings Loss of 4,542 Billion NPR Cumulative Electricity Export Earnings- Base Case Cumulative Electricity Export Earnings- Delay Case

24 Benefits to India from CBET- Based on IRADe Activity Analysis Model Scenario assumption: Scenarios Description India s Electricity Demand by 2050 (in BU) DAU50 Assumes Dynamics as Usual Behaviour (DAU) and projects till ,119 CBET CC-Carbon Constraint CC-CBET Electricity imports from Nepal & Bhutan are assumed in addition to DAU50 assumptions A Carbon Constraint (CC) of 85 GT on cumulative emissions from electricity sector is imposed on the DAU50 scenario Electricity imports from Nepal & Bhutan are assumed in addition to Carbon Constraint scenario CBET Contribution by 2030 and 2050: 13,110 10,300 10,345 Year Share of Electricity Imports in India s Electricity Demand (in %) CBET scenario CC-CBET scenario Cumulative Reduction in CO 2 Emissions (in MT) CBET scenario w.r.t. DAU50 CC-CBET scenario w.r.t. to CC scenario % 6.1% 1, % 1.9% 7,136 4

25 Conclusion CBET benefits all participating countries Small window to tap advantages from CBET Delay in CBET will impact Export income from electricity Direct and indirect GDP gains Reduction in CO 2 emissions Cross Border Electricity Trade There s No Time To Lose

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27 Methodology- Electricity Demand Forecast Data Collection Analysis Forecast Past Electricity Demand Population trend and forecast GDP trend and forecast Electricity demand forecast by Govt. bodies and utilities For Bhutan: Using time series regression analysis For Nepal: Using NEA s demand forecast growth rate Data Source: Ministry and Govt. bodies reports for Bhutan and Nepal United Nations Population Prospects United Nations Statistics Database Presentations of various Ministry representatives of Bhutan and Nepal

28 Methodology- Electricity Supply Forecast Data Collection and Analysis Phase Forecast Capacity Addition Plans Govt. plans and policy for capacity additions Identification of targets achieved against planned capacity additions Generation Potential Past generation trend and PLF PLF for upcoming generation capacity Generation Projection Year wise capacity addition Year wise electricity generation based on : Assumed PLF Upcoming generation capacities Identification of plan wise Capacity Addition Identification of Plant Load factor Identification of expected year of commissioning for upcoming capacities Forecasting expected generation (in MU) Data Source: Ministry and Govt. bodies reports for Bhutan and Nepal Presentations of various Ministry representatives of Bhutan and Nepal

29 In Billion Unit Exportable Electricity Surplus from Bhutan and Nepal Bhutan Electricity Surplus in BU Nepal Electricity Surplus in BU Total Electricity Surplus in BU

30 Electricity Indicator- Bhutan Electricity Demand (in MU) Decadal Electricity Demand Growth Rate Population (in thousand) Decadal Population Growth Rate GDP (at Constant Price) in Million BTN (Base Year) Forecast % 15.8% - 8.9% 8.9% 8.5% 8.3% % 2.4% - 1.4% 0.9% 0.6% 0.3% Decadal GDP Growth Rate GDP* per Capita (in BTN) Electricity Demand per Capita (in kwh) Electricity Demand/GDP* - 5.9% 8.8% - 7.8% 8.2% 8.2% 8.2% * GDP at Constant price Source: Electricity Demand from Statistical Year Book, Bhutan; Population from United Nations Population Prospects, 2012; GDP at constant price for year 2005 from United Nations Statistics Database.

31 Electricity Indicator- Nepal Electricity Demand (in MU) Decadal Electricity Demand Growth Rate Population (in thousand) Decadal Population Growth Rate GDP (at Constant Price) in Million NPR Decadal GDP* Growth Rate GDP* per Capita (in NPR) Electricity Demand per Capita (in kwh) Electricity Demand/GDP* (Base Year) Forecast % 7.6% 8.1% 8.1% % 1.4% - 1.1% 0.9% 0.6% 0.4% % 3.8% - 4.4% 4.3% 4.3% 4.3% * GDP at Constant price Source: Electricity Demand from NEA Annual Report, Nepal; Population from United Nations Population Prospects, 2012; GDP at constant price for year 2005 from United Nations Statistics Database.

32 Electricity Indicator- India (Base Year) Electricity Demand (in MU) Decadal Electricity Demand Growth Rate - 6.7% 5.6% - Population (in thousand) Decadal Population Growth Rate 2.2% 1.8% 1.5% - GDP (at Constant Price) in Million INR Decadal GDP* Growth Rate 5.8% 6% 7.9% GDP* per Capita (in INR) Electricity Consumption per Capita (in kwh) Year Year Electricity Demand/GDP* * GDP at Constant price Source: Electricity Demand from CEA, India; Population from United Nations Population Prospects, 2012; GDP at constant price for year 2005 from United Nations Statistics Database.