Power Trade in Greater Mekong Sub-region Priyantha Wijayatunga, PhD Principal Energy Specialist Asian Development Bank Workshop on Sustainable Development of Power Sector and Enhancement of Electricity Trade in South Asia Region: Policy, regulatory Issues/Challenges and the Way Forward New Delhi, India 1 15 January 2016
GMS at a glance o o Natural economic area bound together by Mekong River o More than 2.6 million square kilometers Region of 329 million people of 6 countries o Strong economic growth (about 7%) o GDP $2.5 trillion ($1500-$5500 per capita) o Total export $441 billion; total import $ 432 billion o Vision for a more integrated, prosperous, and harmonious subregion o 3Cs Connectivity, Competitiveness, Community 2
Energy Potential Estimates 229 GW hydropower potential 1.2 trillion cubic meter of natural gas 0.82 billion tons of oil 28.0 trillion tons of coal 3
GMS Program Started in 1992 with the assistance of ADB $11 billion worth of priority infrastructure projects since then Economic corridors Highways Generation plants, transmission lines 4
Strategic Framework (2012-2022) Approved in 2011- GMS Summit Myanmar Anchored on the corridor-development approach New framework expands the GMS Program From conventional infrastructure to multi-sector investments Foster economic corridor development Stronger cross-sectoral linkages The Regional Investment Framework (2013-2022) Endorsed - GMS Ministerial Conference Vientiane, Lao PDR Dec 2013 Translates the SF into pipelines of investment and technical assistance projects 92 priority projects worth of $30 billion 5
Cross Border Connections Country Cambodia Cross-border Interconnections Cambodia imports power from Viet Nam and Thailand. Private participation Significant both for large scale and small-scale generation. Lao PDR Many cross-border connections are planned mainly for the export of power to Thailand and Viet Nam Very strong in generation and potentially will enter transmission; Mainly investors with an interest in importing power. Myanmar Existing connections with PRC; New interconnections with Thailand and PRC proposed but little progressed. Many projects were proposed by investors with an interest in importing power; their present status is uncertain. BOTs permitted under new legislation. 6
Cross Border Connections. Country PRC (Guangxi Yunnan) and Cross-border Interconnections Links with Myanmar; others are foreseen, but uncertain; Three links to Viet Nam. Private participation Private participation in IPPs, mostly domestic from corporatized subsidiaries of the SOEs. Thailand There are strong connections with Lao PDR; Connections with Cambodia, PRC and Myanmar planned IPPs are a significant part of the expansion plan owned by local investors. Viet Nam Three lines to the PRC for import; More connections with Lao PDR and greater connectivity to Cambodia is likely. Private finance was successful in the early 2000s, but then dried up. Reforms have been made. 7
Existing grid Nam Ngum 2 Nabong Udon Thani 8
Existing Cross Border Connections. 10 Interconnections Commissioned since 1998 Total capacity of about 5000MW At 220/230kV and 500kV 9
Power Trade GMS Power Trade and Net Imports, 2010 (GWh) Source: Calculated from table on GMS Power Flows, 2010. 10
Regional Power Coordination Centre Established in 2013 Secretariat for Regional Power Trading Coordinating Committee (RPTCC)- 2002/3 An institution with legal identity Owned by GMS countries Fully dedicated to manage Cross-border power infrastructure Power trade 11
Ongoing activities Two working groups Main Tasks to Review, complete and adopt: Common Performance Standards for GMS Transmission Regulations Standard Regional Metering Arrangements Prepare GMS Grid Code/Regional Power Trade Operating Agreement (RPTOA) 12
Stages of Regional Power Development Stage 1: Bilateral cross-border connections through power purchase agreements (PPAs) Stage 2: Grid-to-grid power trading between any pair of GMS countries, eventually using transmission facilities of a third regional country Stage 3: Most GMS countries with multiple seller buyer regulatory frameworks, towards the implementation of a wholly competitive regional market GMS in transition from Stage 1 to Stage 2 13
ADB Strategy ADB continues support regional integration Through regional power interconnections and development for mutual benefits: Enable harmonization: technical and regulatory Promote integrated resource planning Assist in mobilization of financing for projects in RIF ADB approved 8 regional TAs over years From hardware to software Information sharing to greater focus on decision making 14
Lessons ADB supporting GMS regional power interconnections and trading as early as 2000 Institutional development Physical infrastructure development Environmental protection Social inclusiveness ADB supporting institution building Countries and private developers lead the infrastructure building 15
Lessons Strong political support Cooperation at technical level Cooperation among GMS countries plus ADB and development partners Bilateral power trade achieved with private sector participation 16
Challenges Domestic demand versus export Moving power trade to utility to utility Gaps among the power systems and regulatory regimes Deepening cooperation to tackle technically complex issues and to gradually harmonize regulatory regimes Fair sharing the benefits of power trade among the participants Managing the social and environmental impacts of hydropower development GMS members to be more proactive and show ownership 17 17
Thank You! pwijayatunga@adb.org 18
Existing cross-border connections From To Voltage Capacity Year Xinquao, Yunnan, Lao Cai, 220 kv 250 300 2006 PRC Vietnam MW Maguan, Yunnan, Ha Giang, 220 kv 200 MW 2007 PRC Vietnam Shewli I HPP, Dehong, 220 kv 600 MW 2008 Myanmar Yunnan, China double circuit Chau Doc, Vietnam Phnom Penh, Cambodia 220 kv (Vietnam) 230 kv (Cambodia) 200 MW 2009 Ban Nabong, Lao PDR Udon Thani, Thailand double circuit 500 kv (operated at 230 kv) 615 MW 2010 Nam Theun 2 HPP, Roi Et, Thailand 500 kv double 1,000 MW 2010 Lao PDR circuit Houayho HPP, Ubon 2, 230 kv 150 MW 1999 Lao PDR Thailand Theun Hinboun HPP, Lao PDR Sakhonnakhon, Thailand 230 kv 200 MW 1998 19
Existing cross-border connections From To Voltage Capacity Year Xekaman 3 HPP, Lao PDR Thanh My, Vietnam 220 kv double circuit 250 MW 2012 Hong Sa TPP, Lao PDR Mae Moh, Thailand 500 kv 1,470 MW 201?? 20
RETA 8830 o GMS performance standards, grid codes and regulatory framework developed and harmonized at regional level o GMS performance standards and grid codes endorsed by the WGPG and RPTCC o Reforms to harmonize the electricity sector across GMS countries proposed for adoption o Fair and transparent transmission tariff methodology proposed for adoption o Establishment of the RPCC 21
RETA 7764 o Phase 2: o Integrated resource planning to be applied (integration of environmental impacts assessment into power planning) o Capacity building 22