gap analysis of renewable energy generation in the lower mekong basin
DESCRIPTION
3rd Mekong Forum on Water, Food & Energy 2013. Presentation from Session 12: Alternative electricity sources and planning for the Mekong.TRANSCRIPT
![Page 1: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/1.jpg)
Bridging the Gap – challenges and opportunities to increasing the role
of renewables in Mekong power supply (MK14)
Gap Analysis of Renewable Energy Generation in the Lower Mekong Basin
2nd Partner MeetingHanoi, 20 November 2013
Alexander Kenny ([email protected])
![Page 2: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/2.jpg)
Gap Analysis Lower Mekong Basin Renewable Energy Targets
• The SEA created scenarios with increased renewable energy. However, strategies to achieve these higher targets were not explored in depth.- How can we get there, and beyond?
Global Trends Energy Planning Paradigm and System Considerations Investor concerns
![Page 3: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/3.jpg)
Renewable Energy Gap in the LMB Percentage of Renewables
• Non-large hydro renewables provide only approximately 3% of global energy production. In the LMB, this figure is 5%.
![Page 4: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/4.jpg)
Renewable Energy Gap in the LMBLower Mekong Basin Power Development Plan Target
![Page 5: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/5.jpg)
Renewable Energy Gap in the LMB
2012 2015 2020 20250
20000
40000
60000
80000
100000
120000
140000
Renewable Energy Output by Scenario: Lower Mekong Basin 2012-2025
PDP Scenario and Energy Efficiency Scenarios
Renewable Energy Scenarios
GWh
![Page 6: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/6.jpg)
Wind
Solar
Geotherm
al
Small
hydro
Biomass / b
iogas
Total
0
20,000
40,000
60,000
80,000
100,000
120,000
Technical PotentialExisting 2010Planned 2025Additional RE Scenario - 2025
Renewable Energy Capacity in the LMB (MW)
Renewable Energy Gap in the LMB
![Page 7: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/7.jpg)
Renewable Energy Gap in the LMB
![Page 8: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/8.jpg)
Hydropower Capacity by Scenario
2012 2015 2020 20250
5000
10000
15000
20000
25000
30000
35000
40000
PDP and 2 Global ScenariosRE-RegionalEE-Regional
MW
![Page 9: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/9.jpg)
LMB in the Global Renewable Energy Context
Globally, “there is clearly going to be a slower pathway to growth than that originally envisaged in 2009” (Ernst and Young) A diminishing role of subsidies and financial incentives, and less investment,
and a concurrent credit crunch. In 2012, investment in the biomass and waste to energy sector fell by
27% to US $9.7b Solar and wind investment fell less, down 9% (to US $142.5b)and down
13% (to US$78.3b) respectively. Due to shale gas, a reduction of 5% of investment in renewable for the world
as a whole is expected in 2013.
“A three-tier world energy market is emerging, with the greatest opportunities for renewables in Asia”
![Page 10: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/10.jpg)
LMB in the Global Renewable Energy Context
• Decreasing costs of renewable technologies– The cost of O&M of wind farms has fallen 38% in four years– The cost of solar panels and equipment continues to
tumble • Supply currently outstrips demand two to one, and the price of
modules could fall from US $0.70 per watt to as low as US $0.48 per watt in 2017 (Lux Research).
• In the United States, installation cost is increasing in importance.
• Improvements in battery technology• Decreasing subsidies for fossil fuels - future cost of
electricity in the Lower Mekong Basin
![Page 11: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/11.jpg)
LMB in the Global Renewable Energy Context Revenue and Cost
Source: Ernst and Young
![Page 12: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/12.jpg)
Relevance of Global Trends to LMB
• How insulated/exposed are Lower Mekong Basin countries to these global trends?
• How do they compare to other “emerging markets”?
![Page 13: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/13.jpg)
Energy Planning Issues
![Page 14: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/14.jpg)
• Current emphasis on centralized generation• Priorities of Energy Planners– Least-cost energy generation optimization
-> But renewable energy is more expensive -> Planning does not adequately include social and
environmental externalities -> Budget for subsidies – EVN already operating at a loss.
Energy Planning Issues
![Page 15: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/15.jpg)
Energy Planning IssuesExternalities not integrated
![Page 16: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/16.jpg)
Energy Planning Issues Reliable system
-> Issues of intermittency as more renewables are deployed. Storage solutions viability of the renewable energy sector • The SEA resulted in increased hydropower pumped storage, and
additional capacity, and increased trading.
Political Economy factors (Possibly overstated demand projections; emphasis on certain technologies)
![Page 17: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/17.jpg)
Energy Planning Paradigm
Fuel-price risk and cost variation are not explicitly integrated into planning decisions-> Portfolio Based Planning is a potential tool
Capital, fuel and operating and maintenance (O&M) costs per unit of output for each technology; the risk of each cost component; and the correlation factors between and within cost components.
![Page 18: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/18.jpg)
Portfolio-Based Planning
![Page 19: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/19.jpg)
Portfolio-Based PlanningFossil Fuel Price Volatility
0
5
10
15
20
25$/mmbtu
WTI CrudeAustralian CoalJapan LNGUSA Gas
![Page 20: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/20.jpg)
Investor Concerns
• Pricing and Costs of Renewable Energy• Policy and Regulatory Climate• Market and Investment Climate
![Page 21: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/21.jpg)
Investor Concerns:Costs/Pricing of Renewable Energy
• Up-front capital costs and pay back period• Often small scale and modular investments
(not always)• Stimulus or lack of for private sector
participation
![Page 22: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/22.jpg)
Investor Concerns:Policy and Regulatory Climate
• Policy coherence and simplicity– Simplicity, clarity and consistency around the policy and
support regime is very helpful.
• Government approval processes – delays, hidden costs, uncertainty
• Transparent government plans– Future electricity pricing– Grid extension plans– Subsidies– World Bank-REF rental scheme, potential market
distortion.
![Page 23: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/23.jpg)
Regulatory Risk
![Page 24: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/24.jpg)
Investor Concerns:Market/Investment Climate
• In-country capacity– Eg. Cambodia biogas operation, absence of a good
network for installation, repair
• Lack of information of costs, benefits, and applications of RE; lack of technical information; lack of market information– Lao PDR small hydro
• Access to financing
![Page 25: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/25.jpg)
Policy Interventions for Case Studies
![Page 26: Gap analysis of renewable energy generation in the lower mekong basin](https://reader036.vdocuments.us/reader036/viewer/2022081518/54681a78af7959f9288b6c6b/html5/thumbnails/26.jpg)
Thank you