SUSTAINABLE ENERGY MIX PORTFOLIO FOR. Namibia. By: BJ Mbuere ua Mbuere. 15 March 2018

Transcription

1 SUSTAINABLE ENERGY MIX PORTFOLIO FOR Namibia By: BJ Mbuere ua Mbuere

2 1. ESI DEVELOPMENT 2. SUPPLY OUTLOOK 3. DRAFT STRATEGIC OVERVIEW 4. PROJECTS IMPLEMENTATION 5. CONCLUDING REMARKS 1

3 The ESI Developments since Independence National Rural Electrification Programme White Paper on Energy Policy ESI Restructuring Study ( ) Rural Electrification Master Plan (2000) Electricity Act 2000 \ Rural Elect. Master Plan (2005, 2010) NORED (2002) ERONGO ( Aug 2005) CENORED( Oct 2005) National Tariff Studies (2001) 2010 ECB Establishment (2000) NamPower Mongula Project ( ) Single Buyer Model Electricity Act 2007 Off-Grid Master Plan (2007) NamP. IRP (2007) Unbundling and Separate account 1 st Regional Load Shed 2

4 The ESI Developments National Integrated Resource Plan (NIRP) (2011) \ National Energy Policy (NEP)2017 NIRP (2017) IPP Framework 2016) National Ren. Energy Policy (NREP) 2016 Net Metering Rules (May 2017) Electricity Bill (2016) NDP4 NDP5 (2017) Harambee Plan (2016) Modified Single Buyer 2 nd Regional Load Shed National Policy for IPPs (NPIPP) Namibia Energy Regulator Authority Bill (2016) PP Act

5 2. Supply Outlook NAMPOWER EXISITING GENERATION PLANTS Plant Source Capacity (MW) Ruacana Hydro 347 Van Eck Coal 90 Anixas Diesel 22 4

6 2. Supply Outlook Local IPPs GENERATION PROJECTS Omburu 4.5 MW of Solar Energy and currently Operational GREENAM 20 MW Solar PV Power supply Expected to come online in the 2nd quarter of 2018 DIAZ WIND 44 MW of wind energy All required approvals obtained Currently in the process of reaching financial close Expected to come online in January 2021 HARDAP SOLAR PV 37 MW of Solar PV expected to achieve COD by June 2018 REFIT PROJECT/PROGRAMME Covered in the next slide 5

7 2. Supply Outlook REFIT PROGRAMME NamPower committed to capacity of 70 MW (14 IPPs each generating 5 MW) each from from non-hydro indigenous renewable energy sources. Five (9) of the 14 have already reached Commercial Operation Date (COD) HoSol in Grootfontein Osona in Okahandja MetDecci in Karibib Aloe in Rosh Pinah Ombepo in Luderitz Ejuva One and Ejuva Two in Gobabis Alcon in Ausenkehr Momentous in Keetmanshop The other 5 are busy with constructions and all to commission by end of August

8 2. Supply Outlook IPPs and ReFIT Economic Contributions 18 Independent Power Producers (IPPs) have signed Power Purchases Agreements (PPAs) with NamPower to supply a total of 171 MW of renewable energy. The 18 IPPs will invest combined total amount of approximately N$ 4.2 billion in the Electricity Supply Industry and ultimately the Namibian economy in the next 24 months. 9 IPPs are already operational, already N$1.1 billion has thus far been spent. 6

9 2. Supply Outlook EXISTING ENERGY IMPORT AGREEMENTS/PPAs South Africa (Eskom) 200 MW Five year firm for a period of five years from 1 April Additional Energy supplied on Day-Ahead Request basis. Zambia (ZESCO) 10 years, 50MW Firm Power Contract expiring in December 2020 Zimbabwe (ZPC) 10 years, 80MW Firm Power Contract at 50% Load Factor and Expires

10 2. Supply Outlook Imports vs Local Gx 39% 61% Hydro vs Intermittent Imports Local Gx There will be a significant decrease on the imports, depending on the outputs of Ruacana. Namibia currently imports about 60% and after commissioning the renewable plants the imports will reduce to 36%. The Renewable energy sources will still be dominated by Hydro and when it is operating, it can be used to do the load following. 67% 33% Intermittent RE Hydro 8

11 2. Supply Outlook Short Term 9

12 3. Draft strategic overview NamPower s revenue stream will decrease as most of the affluent customers are considering embedded generation or defecting. NamPower Mega Projects are complex and requires government guarantees. NamPower operating environment is changing rapidly and company s strategy requires modification. National Energy Policy (NEP) Independent Power Producer s Framework (IPP) Renewable Energy Policy (REP) Modified Single Buyer Model (MSBM) National Integrated Resource Plan (NIRP) New electricity supply technologies are entering the market space. Paris Climate Accord, NIRP - Namibia has made a commitment to attain 70% of its electricity requirements from renewable energy technologies by The system will experience a steep ramp-up requirements when the Solar PV stop producing. NamPower is still a net importer of electricity in the region and is working hard to reduce its import portfolio by implementing new generation projects. 10

13 Current status of Single Buyer TRADING ARRANGEMENTS Allowed Trading Arrangements for Namibia s Existing Single Buyer Market Structure Off-grid & mini-grids NP (G) Single Buyer NP (C) Captive Generation Imports IPPs Single buyer licensed as sole purchaser of power in Namibia SB at as sole importer and exporter of energy SB supplies REDs and large users against a Bulk Supply Tariff SB activity is a regulated monopoly with performance targets Exports REDs, LA, & RC Captive Generation Customer Embedded IPPs 11

14 Modified Single Buyer TRADING ARRANGEMENTS Stage 4: Trading Arrangements for Namibia s MSB Market Structure NP (G) MSB (SO/MO) 1 NP (C) Off-grid & mini-grids Captive Generation Imports IPPs Eligible IPPs Exports 4 REDs, LA, & RC Contestable Customer 3 Captive Generation Customer Embedded IPPs 2 Obligatory arrangement New optional arrangement Ancillary Services will be procured by the MSB Eligible IPPS embedded at the distribution level selling to the connected distributor (wheeling agreement not needed) The size limit definition for contestable customer will be set by the regulator IPPs are required to give priority to the MSB before exporting with a call-option at the PPA negotiated price 12

15 Duck curve Capacity (peak demand) Energy = Area under the graph 14

16 Mitigation measures of Intermittency Multiple RE plants which are geographically dispersed have the positive effect of reducing intermittency Initial studies indicate that conventional spinning reserve (e.g. Diesel/HFO/LNG) to solely address Intermittency would be a costly solution. Intermittent RE penetration limit will improve as Transmission strengthening is introduced. NamPower to handle the intermittency through its control area charges to ESKOM or to procure specific Ancillary Service from SAPP to address the Intermittency. Detailed weather forecasting reduces the impact of intermittency on the system. 15

17 3. Draft strategic overview - Opportunities NamPower to provide off-grid generation solutions and Smart grid technologies as a new business initiative. The advancement of balance sheet funded decentralised distributed generators will unlock economic opportunities for NamPower and Namibia. NamPower to supply reliable and affordable electricity driven by decarbonised energy systems and technological innovation. Namibia will reach the 70% target of the Paris Climate Accord in 2021 (Ruacana, REFiT, Diaz, Greenam, Hardap, Omburu). 16

18 4. Projects Implementation Consideration on Projects implementation will be based upon NIRP Implementation criteria Positive feasibility study outcome Projects to be considered should be able to provide ancillary services such as: black-start facility load following Spinning reserves.. etc Economic benefits to the country Environmental sustainability 17

19 National Integrated Resource Plan YEAR SOLA R - PV PLAN A WIND BIO MASS CSP THERM AL YEAR Hydro SOLAR - PV PLAN B WIND 11 BIO MAS S CSP 19 THERMA L

20 Nc/kWh 1,400 Average Price 1,200 1, % 20% 30% 40% 50% 60% 70% 80% 90% 100% LFO (120MW) CSP (150MW) Biomass (20MW) 1, Paratus (40MW) Storage (20MW) Wind (50MW)

21 5. Concluding Remarks Board resolved that all business plans for the following projects be concluded: Biomass, CSP, Kudu and Baynes. NamPower will continue to handle the intermittency through its control area charges to ESKOM or procure these ancillary services from SAPP. Feasibility studies are on going for decentralised generation options to be considered such as. Solar PV with Storage Wind A brief preliminary analysis shows that battery storage may provide a cost-effective method of reducing intermittency, compared to conventional spinning reserve. 20

22 5. Concluding Remarks The current strategic plan of NamPower will come to an end in June 2018 NamPower is in the process to craft a new strategic plan for the next five years. All stakeholders will be consulted through various workshops during the process. 21

23 End Pula 22