Transcript ZAMBIA POWER MARKET - Economics Association of Zambia
ZESCO LIMITED “Challenges and Possible Solutions in the Power Sector”
A PRESENTATION TO THE ECONOMICS ASSOCIATION OF ZAMBIA R P SISALA MANAGING DIRECTOR
10 TH JULY 2008
PRESENTATION LAYOUT
1.
2.
3.
4.
5.
6.
Overview of Zambian Power Sector Outline of ZESCO Power System The Power Supply Challenge ZESCO System Status Strategies to Overcome the Deficit Conclusion
1.
OVERVIEW OF ZAMBIAN POWER SECTOR
I.
MAJOR ECONOMIC ACTIVITIES
Mining Agriculture Tourism Industry & Commerce Construction And Housing
II.
POWER SECTOR PLAYERS
ZESCO-PUBLIC UTILITY
Public Utility Generation, Transmission, Distribution and Supply
COPPERBELT ENERGY CORPORATION
Privately Owned Transmission & Distribution to Mines BSA with ZESCO to Purchase Power and Sell to Copperbelt Mines (Ex ZCCM) 80MW Gas Turbines
LUNSEMFWA HYDRO POWER COMPANY
Privately Owned Generation Capacity-37MW Some transmission lines into Kabwe PSA with ZESCO for Sale of Bulk Power
2. OUTLINE OF ZESCO POWER SYSTEM
I.
ZESCO FACT SHEET
Vertically integrated utility Annual turnover: US$$300million Assets in excess of US$3.0billion
Customer base: over 300,000 Employees: 3,900 Sales: 9,450GWh National maximum demand: +1,500MW Customer/employee ratio: 80 Approx. 50% sales to CEC & other mining customers 5% exports to regional markets Access rates-27%
II. GENERATION ASSETS
Kafue Gorge - 900MW (990MW) Kariba North Bank - 600MW (720MW) Victoria Falls - 108MW Small Hydros - 24MW
TOTAL INSTALLED CAPACITY 1,640MW (1850MW)
III.
TRANSMISSION ASSETS
330KV - 2,008km 220KV - 548km 132KV - 85km 88KV - 704km 66KV - 3,014km High Voltage Substations - 27 National Control Centre - 01 Regional Control Centres - 03
IV.
DISTRIBUTION ASSETS
66kV +3,000km 33kV & 11KV +6,500km MV lines +20,000km In excess of 5,000 substations 6 Diesel fired power stations 8MW
ZESCO GRID (66 – 330kV)
To Sumbuwanga CHIENGI KAPUTA 8 o MPULUNGU D R CONGO MWINILUNGA ANGOLA CHAVUMA MICHELO WEST LUNGA at West Lunga River (2.5MW) KANSANSHI SOLWEZI LUMWANA KABOMPO Gorge (34MW) (Mine) LUANO KITWE MUFUMBWE MAPOSA CHIKATA FALLS (3.5MW) ZAMBEZI KABOMPO KASEMPA MPONGWE MBALA MAMBILIMA KUNDABWIKA (101MW) LUNZUA (0.75MW) KASHIKISHI NCHELENGE MBERESHI MPOROKOSO KABWELUME (62MW) Kawambwa Town KAWAMBWA TEA KALUNGWISHI RIVER CHISHIMBA FALLS Chambasitu KASAMA NAKONDE ISOKA MUSONDA FALLS (5MW) LUWINGU MUYOMBE CHINSALI MANSA SAMFYA MOMBUTUTA KANSUSWA BWANA MKUBWA KAPIRI MPOSHI PENSUL O SERENJE Mkushi Mkushi Central Mkushi Farm Block LUSIWASI (12MW) LUSIWASI EXTENSION (40MW) MSORO MPIKA MFUE CHAMA LUNDAZI CHIPATA 22 o East KALAB O SHANGOMBO LUKULU MONGU SENANGA KAOMA ITEZHI – TEZHI (120MW) LUNSEMFWA (18MW) MUMBWA NAMPUNDWE LUSAKA WEST KABWE ROMA KAFUE WEST MAZABUKA MUZUMA MULUNGUSHI (20MW) CHONGWE Luangwa Bridge COV.
KAFUE TOWN KAFUE GORGE 900MW(1080MW) KARIBA NORTH (600MW(750MW) KARIBA NORTH EXTENSION ( 600MW ( 750MW ) LAKE KARIBA LEOPARDS HILL KAFUE LOWER (750MW) LUANGWA CHIRUNDU KARIBA SOUTH KATIMA MULILO SESHEKE VICTORIA FALLS (108MW) DEVILS GORGE (800MW) MAAMBA NAMIBIA KATIMA MULILO BOTSWANA BATOKA GORGE (800MW) 18 o ZIMBABWE PETAUKE AZELE 33.5
o East MOZAMBIQUE
EXISTING POWER\SUBSTATIONS AND POWER LINES
330kV 220kV 132kV 88kV 66kV HYDRO POWERSTATION SUBSTATION DIESEL STATION
PROPOSED POWER\SUBSTATIONS AND POWER LINES
330kV 220kV 132kV 88kV 66kV PROPOSED HYDROPOWERSTATION PROPOSED SUBSTATION PROPOSED DIESEL STATION
3. THE POWER SUPPLY CHALLENGE -
REGIONAL AND ZAMBIAN PERSPECTIVE
I.
MAIN DRIVERS OF ELECTRICTY DEMAND AND THE DEFICIT
Economic Growth of more than 5% in most of the SADC member countries resulting in unprecedented growth in electricity consumption and demand Driven by increased demand for base metals resulting in high metals prices on world market New mining companies established and others expanded Growth in other sectors such as industry, commerce, agriculture, housing, etc Country electrification programmes – rural and urban Inadequate investment in generation and transmission infrastructure over the last 20 – 30 years
II.
ENERGY DEMAND PROJECTIONS
EXISTING CAPACITY TO BE EXHAUSTED AROUND 2007/08 BOTH NATIONAL AND REGIONAL DEMAND TO SURPASS CURRENT CAPACITY NEED FOR NEW POWER PLANTS ELECTRICITY IS KEY TO NATIONAL ECONOMIC DEVELOPMENT
SAPP DEMAND PROJECTIONS 1998 TO 2010
1998 2000
Installed Capacity Future demand
2007 2010
THE CHALLENGE WAS IDENTIFIED AND COMMUNICATED BUT NOT ADEQUATELY ADDRESSED
III.
CHALLENGES NOT ADEQUATELY ADDRESSED
CAPITAL INVESTMENT REQUIREMENTS
Power projects have long gestation periods Pre-feasibility & feasibility studies plus EIA Project packaging and mobilisation of finance Plus project implementation 5 – 7years Power sector investments require huge capital outlay Characterised by long payback periods But private sector requires short term returns Power projects compete for capital with more lucrative projects with short term returns
CHALLENGES NOT ADEQUATELY ADDRESSED Cont’d
SUB-ECONOMIC TARIFFS
Tariffs in Zambia too low & not cost reflective Cannot meet typical investment requirements Legacy of socialist economy Topic flavoured by socio-political issues
COMPARISON OF REGIONAL TARIFFS (2007)
UTILITY COUNTRY
BPC CEB EDM ENE ESCOM Eskom KPLC LEC NamPower SEB TANESCO UMEME ZESA ZESCO REG. AVERAGE BOTSWANA MAURITIUS MOZAMBIQUE ANGOLA MALAWI SOUTH AFRICA KENYA LESOTHO NAMIBIA SWAZILAND TANZANIA UGANDA ZIMBABWE ZAMBIA SADELEC
CURRENCY
USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh) USCents/kWh)
DOMESTIC (kWh)
6.2
12 11 3.7
3.6
6.1
9.4
6.9
10.8
6.9
7.5
23 0.7
2.5
6.4
COMMERCIAL (kWh)
6.1
18.9
1.4
3.9
6.3
6.0
11.4
9.6
10.2
8.4
8.2
22.6
0.5
3.7
8.4
INDUSTRIAL (kWh)
4.2
7.2
5.3
2.2
3.9
2.2
8.3
4.3
7.0
5.0
6.3
10.9
0.3
2.6
5.0
25 20 15 10 5 0
COMPARISON OF REGIONAL TARIFFS (2007)
REGIONAL TARIFFS 2007
DOMESTIC COMMERCIAL INDUSTRIAL
UTILITY
CHALLENGES NOT ADEQUATELY ADDRESSED Cont’d
SURPLUS CAPACITY
Zambia was an energy surplus nation Economy went through period of stagnation Did not anticipate high rate of economic recovery
CHALLENGES NOT ADEQUATELY ADDRESSED Cont’d
STAKEHOLDERS AND LOBBY GROUPS
Sector opened to private investment through Electricity Act CAP 433 of 1995 Govt. established OPPI in 1999 Package of incentives for private sector investment in power projects put in place Future generation projects to be private sector driven Endless debates on privatisation and/or restructuring of ZESCO but no new Megawatts Private sector was seen as panacea for future energy requirements but none came to invest Generation projects taken away from ZESCO
ZESCO’S RESPONSE TO CHALLENGES ZESCO’S RESPONSE
ZESCO recognised that time was being lost in privatisation and other debates about the structure of the industry Not permitted to invest in new generation projects Saw that the nation would one day wake up to a power deficit Need for quick intervention at least to delay day of reckoning Took the option of changing scope of its Power Rehabilitation Project to include uprating Uprating of Kafue Gorge and Kariba North Bank to add 210MW of additional capacity at minimal cost This action delayed project completion but it was worthwhile
4. ZESCO SYSTEM STATUS
ZAMBIA: CURRENT DEFICIT
PRP in progress at Kafue Gorge and Kariba North Bank power stations Total 450MW not available Available capacity 1,170MW Current national demand 1,450MW The deficit is a peak period phenomenon, sufficient capacity during off-peak periods Load management otherwise known as load shedding required in order to maintain balance of supply and demand during peak periods
1400 1200 1000 800 600 400 200 0
ZESCO - TYPICAL DAILY LOAD CURVE
GENERATION WITH 2 MACHINES OUT AT KFG, 1 AT KNB DAILY LOAD
TIME
TYPICAL LOAD MANAGEMENT SCHEDULE STATION Kariba North Kafue Gorge Victoria Falls Lunsemfwa Snel Imports Total Generation Available Capacity (Less transmission Losses) Lusaka allocation Ndola allocation C/belt Division allocation CEC allocation Kansanshi allocation Bwana Mkubwa Others TOTAL ALLOWABLE LOAD CAPACITY ( MW) 400 490 90 30 120 1,130 1,074 258 55 103 470 75 12 102 1,074
5. STRATEGIES TO OVERCOME THE DEFICIT
I.
SHORT TERM STRATEGIES
DEMAND SIDE MANAGEMENT
Reduction in peak demand by voluntary load reduction - otherwise power rationing and load shedding by ZESCO Process efficiencies Use energy efficient appliances equipment e.g.
- replace incandescent lamps with Compact Fluorescent Lamps (CFLs) Shifting of load away from peak periods - switch off unnecessary appliances during peak periods e.g. electric geysers, swimming pool pumps, borehole pumps - business houses can shift (some) production processes to off-peak and benefit from off-peak tariffs Power factor improvements - large consumers such as mines, industry and agriculture - carefully selected process equipment - retro-fitting capacitor units on inductive equipment such as electric motors
SHORT TERM STRATEGIES cont’d
UPRATING OF EXISTING POWER STATIONS
Kafue Gorge - 900MW TO 990MW Kariba North Bank - 600MW TO 720MW Additional capacity:
- 210MW
ZESCO to accelerate PRP - complete Kafue Gorge December 2008 - complete Kariba North Bank March 2009 Similar projects being undertaken at regional level
PROMOTING ENERGY EFFICIENCY STRATEGIES USE OF CFL’s
• Suspension of duty and VAT • Partnerships with retailers • Encourage use by consumers
4/30/2020
INDOOR LIGHTING: Hotels, Homes
• Save 80% • USE OF ENERGY SAVING lamps – Compact Flourescent Lamps (CFLs)..
• Dimmer Switchers
4/30/2020
INCANDESCENT VS ENERGY SAVER BULB
TYPE OF BULB WATTAGE AVERAGE COST 100W K 2,000.00
AVERAGE LIFE SPAN 6-12 MONTHS AVERAGE ENERGY USED PER MONTH (for 3 bed room home 6HRS/DAY) COST OF ENERGY USED PER MONTH 144kWh K12,384.00
K70/kWh) 18W K 15.000.00
5-6 YEARS 25.92kWh
K2,222.64
METER INSTALLATION PROGRAMME
• Prepaid meter installed in Lusaka-22,000 • Further 60,000 in Phase 2 of Lusaka • 65,000 in Copperbelt • 70,000 in other urban areas by 2010 • Reduction in non-technical losses • Increased Energy savings 4/30/2020
ENERGY MANAGEMENT
RESIDENTIAL
• SWITCHING OFF APPLIANCES e.g GEYSERS,SWIMMING POOL PUMPS, SECURITY LIGHTING,DEEP FREEZERS, BOREHOLE PUMPS etc.. DURING PEAK LOAD TIMES • SET GEYSER THERMOSTART @ 60 DEG.
• CORRECT INSULATION 4/30/2020
MANAGING GEYSERS
• Switching off 2kw geysers between 07 21hrs
• 24hrs operation-864kWh/Month @ K170,000 • 10hrs operation-360kWh/Month@K49,000 Savings-K121,000 • Switching off 3kw geysers between 07-21hrs • 24hrs operation-1296kWh@K276,000 • 10hrs operation-540kWh@K138,000 • Savings-K138,000 4/30/2020
SECURITY/OUTDOOR LIGHTING
HOMES, HOTELS, INDUSTRY Save 80% by replacing ML 160w with Master Ecotone 45w/65w lamps
COMMERCIAL
• INSTALL ROOM OCCUPANCY SENSORS – to switch off lights & air-conditioning in unoccupied rooms • INSTALL POWER FACTOR CORRECTION EQUIPMENT (where lots of electric motor are in use) • REPLACE ORDINARY BULBS WITH ENERGY SAVERS (CFLs) • REPLACE MERCURY VAPOUR LAMPS WITH METAL HALIDE LAMPS (45W/60W FOR 160W) FOR OUTDOOR LIGHTING
ROOM OCCUPANCY SENSORS
• INSTALL IN EACH ROOM • SWITCHES OFF LIGHTS & AIRCONS IN UNOCCUPIED ROOMS
INDUSTRIAL
• • • • • •
INSTALL ELECTRIC MOTOR OPTMISERS ON BIG MOTORS USE Variable Speed Drives (VSDs) for pulley coupled drives INSTALL POWER FACTOR CORRECTION EQUIPMENT(CAPACITOR BANKS) DO NOT START ALL YOUR MACHINES AT THE SAME TIME TO AVOID CREATING LOCAL PEAK LOADS ARREST ALL COMPRESSED AIR LEAKS INSULATE ALL STEAM PIPES CORRECTLY
4/30/2020
INTELLIGENT MOTOR CONTROLLERS
• • • • Intelligent because it matches power input to shaft load Saves up to 40% energy Has inbuilt soft start/stop Reduces inrush currents
Floor mounted Capacitor Bank • Power factor correction • Reduces KVA input • Save up to 15% energy
VARIABLE SPEED DRIVES (VSD)
• SAVE UP TO 15% ERNEGY
STREET LIGHTING
:
USE METAL HALIDE LAMPS
• REPLACE THE INEFFICIENT MERCURY VAPOUR LAMPS WITH METAL HALIDE LAMPS • 400W/250W MV LAMPS WITH 160W METAL HALIDES • METAL HALIDES HAVE INBUILT SENSORS TO RUN DIM WHEN NO TRAFFIC ON ROAD • ENHANCED BRIGHTNESS
REVISED SAPP PROJECTIONS 2005 TO 2020
Committed - Rehabilitation - Short Term 72000 68000 64000 60000 56000 52000 48000 44000 40000 36000 Capacity Planned Year Capacity Required Peak Demand after DSM
II.
MEDIUM TO LONG TERM STRATEGIES
INCREASE GENERATION CAPACITY BY BUILDING NEW PLANT
Zambia has an estimated hydro power potential of 6,000MW of which less than 2,000MW has been harnessed. Sites yet to be developed include Kafue Gorge Lower, Itezhi Tezhi, Kalungwishi, Mambilima, Batoka Gorge, Devil’s Gorge, Kabompo, etc
MEDIUM TO LONG TERM STRATEGIES cont’d
In Zambia planned projects include the following ZESCO projects: Itezhi Tezhi - Capacity120MW - Cost US$250Million - Implementation 2008 – 2012 Kariba North Bank Extension -Capacity: 360MW - Cost: US$300Million - Implementation:2008 – 2012
MEDIUM TO LONG TERM STRATEGIES cont’d
INCREASE GENERATION CAPACITY BY BUILDING NEW PLANT
Other planned projects in Zambia include: Kafue Gorge Lower Maamba (Coal fired) 600 – 750MW 300 – 450MW Similar projects planned or in progress at regional level
MEDIUM TO LONG TERM STRATEGIES cont’d
REGIONAL INTERCONNECTIONS TO OTHER UTILITIES (TO SHARE REGIONAL GENERATION CAPACITY)
Existing Zambia – Zimbabwe: Zambia – DRC: 2 x 330KV 1 X 220KV Planned Livingstone – Hwange (Zimbabwe): 1 x 330KV Livingstone – Katima Mulilo (Namibia): 1 x 220KV (Phase 1 on Zambian side complete, phase 2 in Namibia in progress) Kafue – Livingstone: Zambia – DRC: upgrade existing 220KV to 330KV 1 x 330KV Zambia – Tanzania – Kenya: double circuit 330KV -
Map of Southern Africa
Equator 45 10 40
6.
CONCLUSION
Power sector crucial to dynamic economic growth Massive investments required in power sector Cost reflective tariffs an important element in all efforts Demand Side Management crucial to manage deficit The task is heavy but not insurmountable Need for all stakeholders to play their part