POWER SECTOR AN OVERVIEW

Transcription

1 POWER SECTOR AN OVERVIEW October 2012 Demand

2 Why Power? 1. Manufacturing companies need it to operate plant and machines 2. Service companies need it to operate technology 3. Agriculture needs it for tube wells 4. Domestic Consumers need it for a Hassle free life If all of the above are getting the required power, economy can proceed with other basic &developmental l activities in the country. Demand

3 Evolution Electricity & Gas Distribution (al Share in GDP) % Electricity & Gas Distribution FY00 FY05 FY09 FY10 FY11 FY Declining trend in share of utilities (reduction in supply of energy) in GDP. Significant impact on GDP The cost of supply deficit/reduction to the economy is ~PKR380bn (~2% of GDP) [Economic Survey of Pakistan]. Demand

4 Largely a single buyer model - Generation Transmission Distribution Consumption Furnance Oil Independent Power FESCO Thermal Gas Plants, Generations GEPCO Domestic Coal Companies, and HESCO KESC National IESCO Industrial Hydel Water Dams Transmission and LESCO Solar Distribution ib i Company MEPCO Commercial Renewable Independent Power Wind PESCO Plants Hydel IPPs QESCO Others KESC TESCO KESC Demand

5 Key Participants in Pakistan WAPDA, IPPs, RPPs, and GENCOs sell electricity to the central power purchasing agency (CPPA) National Transmission and Despatch hcompany KESC is the only vertically integrated company in Pakistan. It has its own generation plants and to meet the demand of its coverage area mainly Karachi, KESC buys electricity from NTDC NTDC, through CPPA, transmits the electricity to distribution companies (DISCOs). DISCOs Peshawar, Islamabad, Lahore, Multan, Quetta, Hyderabad, Gujranwala, and Sarhad Electric Supply companies. Electricity is then sold to final customer. Demand

6 Regulatory Framework The Regulator: National Electric Power Regulatory Authority [NEPRA]: 1. Issues Licenses for generation, transmission and distribution of electric power 2. Establishes and enforces Standards to ensure quality and safety of operation and supply of electric power to consumers 3. Approves investment and power acquisition programs of the utility companies 4. Determines Tariffs for generation, transmission and distribution of electric power. Demand [Pakistan]

7 Power of World in the World of Power 1990 : 11,822 TWh 2010 : 20,629 TWh 37% 15% 11% 41% 21% 5% 17% 18% <1% 13% 16% 2% <1% <1% 1% <1% <1% 1% Increased reliance on coal and gas Increased focus on solar and wind decreased reliance on hydel and oil Demand

8 Power of World in the World of Power 30,000 Electricity it demand d in the world Projections 26,503 TWh 25,000 20,000 TWh 15,000 10,000 5,000 0 Expected Generation Mix 2020 Fuel / Growth Low High Coal Gas Oil Low growth scenario Nuclear Hydro Wind Solar Geothermal Other Total TWh 26,503 30,392 Demand

9 Power of World in the World of Power World [TWH] Pakistan Generation (TWH) 18,960 19,020 19,250 19, , Consumption (TWH) 16,880 17,480 17,930 17,780 19,090 Per Capita consumption (KWH) 2,517 2,574 2,649 2,566 2,719 Losses -11% -8% -7% -7% -6% 2011 Generation (GWH) 102,484 Consumption (GWH) 76,285 Per Capita consumption (KWH) 431 Losses -26% Pakistan s s per capita consumption is ~6x lower than world average Demand

10 Electricity Generation in Pakistan Generation Capacity (MWH) 2012 Installed % of total GENCOs 4, % KESC 2, % Thermal IPPs 8, % RPPs % Others (CPPs/SPPs) % WAPDA 6, % Hydel IPPs % Nuclear Two Nuclear plants % Import Mainly from Iran - 0.0% Total 23, % MWH Comparison of Installed Capacity and Generation of Electricity 25,000 Hydel Nuclear 4.9% Capacity in 20,000 15,000 10,000 5,000 Installed Capacity 20,232 20,556 21,614 23,412 23,641 Generation 11,125 10,806 11,399 11,699 11,158 Units Generated during the year 97,451 94,663 99, ,484 97,745 Electricity Generation by sector players (including Imports) Source wise electricity generation during FY12 during FY12 Others Import (Iran) Mixed Import 0.3% 0.8% 0.3% 1.7% Wind 0.0% GENCOs 13.5% 125, ,000 75,000 50,000 25,000 - illions Units in Mi Gas 26.2% Hydel 31.9% WAPDA 30.7% KESC 8.6% RFO 34.1% Coal 0.1% HSD 1.6% IPPs 45% Demand

11 Electricity Consumption in Pakistan Segment wise Electricity Consumption Public Light Bulk Supply 06% 0.6% 46% 4.6% Agriculture 11.8% Others 1.6% Commercial 7.5% Domestic 46.2% Industrial 27.7% Demand

12 Demand Supply Gap [Going forward] Power Generation Projects in Pipeline No Capacity Expected Cost Per MW Public US$ Hydel 12 2,358 96, Private Oil Based , Pipeline Quality Gas Dedicated Gas fields Hydel 16 5,271 10, Coal 7 1,725 2, Naphta , , Deficit in Demand (MWh) FY13 FY14 FY15 Planned Generation Capability 21,746 24,212 25,081 Projected Demand Growth Rate 8% 7% 7% Projected Demand Growth Rate 25,284 27,092 29,032 Deficit (3,538) (2,880) (3,951) Demand

13 Business Risk Assessment 1. Demand Supply Gap [Supply in Deficit] 2. Lifecycle [Growth] 3. Competitiveness [Low Buyer Power ; Low Supplier Power] 4. Significance to suppliers [High] Power Deficit in Pakistan 30,000 25,000 20,000 15,000 10, ,000 - (5,000) (10,000) Generation Capability 14,707 16,040 15,144 15,430 Demand during Peak Hours 19,281 20,314 21,029 21,086 MW WH Deficit (4,574) (4,274) (5,885) (5,656) Deficit % Max Demand 24% 21% 28% 27% 30% 25% 20% 15% 10% 5% 0% -5% -10% 2011 Consumption of country Consumption of % of total country consumption Electricity generated (MWH) Consumption of Fuel per MW of Electrcity High Speed Diesal (tonnes) 6,700,436 99,847 1% 358, Furnance Oil (tonnes) 8,921,327 8,038,924 90% 35,846, Natural and Low BTU Gas 1,240, ,906 30% 29,118, (mln cubic feet) Coal (Tonnes) ,488 1% 131, Oil, Gas, Coal (TOE) 50,162,164 15,082,791 30% 65,454, Demand

14 Business Risk Key Performance Indicators 1. Generation Efficiency 2. Transmission i & Distribution ib i losses 3. Recovery of bills/receivables 2011 Units Purchased Units Sold/Billed Dist Losses Amount Lost Billed Realized (PKR mln) (PKR mln) (PKR mln) Recovery Ratio PESCO ,712-35% (37,133) 69,065 54, % IESCO ,674-10% (7,231) 67,015 62, % GEPCO ,439-12% (7,625) 56,111 55, % LESCO ,741-13% (21,178) 138, , % FESCO ,596-11% (9,411) 74,289 74, % MEPCO ,189-18% (18,956) 84,637 82, % HESCO ,814-34% (27,229) 229) 53, , % QESCO ,048-20% (7,998) 31,250 12, % KESC ,072-35% (56,961) 107,016 91, % 97,664 76,285-22% (188,211) 681, , % Demand

15 [Inter-corporate debt & Subsidy] Inter-Corporate t Chain of DEBTS Receivable from Consumers End Consumer DISCOs, KESC Payable to DISCOs, KESC Payable to NTDC Low Recoveries Losses Subsidy Receivable from DISCOs, KESC NTDC, KESC Payable to IPPs, GENCOs Receivable from NTDC IPPs, GENCOs Payable to Fuel Suppliers Receivable from IPPs, GENCOs, KESC Fuel Suppliers Payable to E&P Companies Receivable from Fuel Suppliers E&P Companies Tariff Determined by NEPRA (Rs./kwh) Tariff Notified by GOP (Rs./kwh) Subsidy Rs./kWh) Demand

16 [Key Performance Indicators] 1. Working Capital Management 2. Debt Repayment Behavior 3. T&D Losses Demand

17 What s the outlook NEGATIVE Business Risk: Generation Segment: low. Transmission and Distribution Segment: medium. : Generation, Transmission and Distribution Segment: medium to high Demand

18 Bibliography 1. Pakistan Economic Survey : Chapter 1 Growth and Stabilization Table 1.5: al Share in Gross Domestic Product (GDP) 2. Pakistan Economic Survey : Chapter 14 Energy 3. National Electric Power Regulatory Authority (NEPRA) : 4. Water and Power Regulatory Authority (WAPDA) : 5. Pakistan Electric Power Company (PEPCO): 6. National Transmission and Despatch Company (NTDC) : 7. State of Industry Report : 9. Wärtsilä Corporation : Private Power and Infrastructure Board (PPIB) : Pakistan Economic Survey : Chapter 12 Population Labour Force and Employment Table 12.1: Selected Demographic Indicators 12. Central Intelligence Agency World Fact Book Pakistan Energy Year Book : Note : All year wise Electricity Statistics of Pakistan relate to Fiscal Year (which starts from Jul and ends in Jun)

19 Analysts Rana Muhammad Nadeem Samiya Mukhtar Naureen Hyat Arslan Rafique Contact number: DISCLAIMER PACRA has used due care in preparation of this document. Our information has been obtained from sources we consider to be reliable but its accuracy or completeness is not guaranteed. The information in this document may be copied or otherwise reproduced, in whole or in part, provided d the source is duly acknowledged. d The presentation tti should not be relied upon as professional advice.