Transcript A China and India Perspective

Science, Research and Development
European Commission
A China and India Perspective
Denise Knight
IIEC
7/16/2015 - 1
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
Presentation Outline
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7/16/2015 - 2
Transformer Industry Overview
Energy Savings Potential
Economics
Market Dynamics
In-Country Initiatives
Actions Needed
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
European Commission
Science, Research and Development
European Commission
Distribution Transformer Market
China
1,031,000 MVA Installed
India
5% Annual Production Growth Rate
47,000 MVA annual demand
315 kVA Avg. Size
148,032 MVA Installed
38,200 MVA annual demand
8 % Average Installed Base Growth Rate
63 kVA rural and 250/500 kVA urban Avg. Size
Distribution Is Bottleneck - Expanding Market
7/16/2015 - 3
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Energy Efficiency Opportunity
India
40
60
kWh (billion)
kWh (billion)
China
40
20
0
1
5
15
10
20
30
20
10
0
1
Year
No Change
Ultra-Efficient
5
10
Year
No Change
Efficient
Ultra-Efficient
47 Billion kWh Potential Savings
7/16/2015 - 4
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
15
20
Science, Research and Development
European Commission
Economics
Payback
TOC
$16,000
$14,000
TOC (NPV)
$12,000
$10,000
S9
AMT 40% PP
$8,000
A
B
C
D
100 kVA
Price
NLL LL
TOC
$1,568
260 1760 $3,881
$1,722
170 1560 $3,488
$2,090
68 1450 $3,309
$2,227
72 1250 $3,340
AMT 20% PP
$4.70 NLL $/Watt
$0.62 LL $/Watt
$6,000
28
25
22
19
16
13
10
7
4
1
$4,000
Years
India
China
Energy Efficient DTs are Cost Effective
7/16/2015 - 5
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Rank
4
3
1
2
Science, Research and Development
European Commission
Market Structure
China
India
10%
6%
22%
39%
3%
13%
29%
Urban Utility
Industrial
78%
Rural Utility
Commercial
SEB & UD
Exports
Industry
Commercial
SEB - State Electricity Board (Government)
UD - Urban Distributor (Private)
Electric Utilities Largest Customer Segment
7/16/2015 - 6
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Key Buying Factors
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China
Reliability (Minimal requirement)
Price
Design Institute
Recommendations
Losses
Supplier relationships
No TOC Evaluation
India
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Price
Local supply
Supplier relationships
Reliability
REC recommendations
Limited TOC Evaluation
Little Value Placed on Losses or Efficiency
7/16/2015 - 7
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Transformer Efficiency
Load Loss (kW)
Load Loss (kW)
315 kVA
100 kVA
1.20
3.3
AM/CU
AMT
S9
1.0
1.30
3.7
0.8
0.4
0.2
No Load
Loss
(kW)
.30
1.40
0.25
1.50
4.3
S7
4.7
1.60
AA -
CC -
0.15
0.10
SiFe/CU
1.70
SiFe/AL
China
India
HD428 - European
Harmonization Documents
Technology Available - Market Barriers Exist
7/16/2015 - 8
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Market Barriers
China
India
• No Loss Evaluation System Price decides purchase
• Numerous purchase
“influences” - Bureaucratic
purchase process
• Purchaser/User differ - varying
objectives
• EE quality raw materials
imported - increases costs
• Central government policy
drives change
• Utility financial crisis - seek cost
reductions
• Price decides purchase compromise on quality; 8%-35% of
DTs fail annually
• Organized manufacturers don’t
compete - relationships influence
supply
• SEB Chairman political
appointee - high turnover;
operations policies inconsistent
Barriers Exist, But...
7/16/2015 - 9
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Changing Conditions
China
India
Government Regulations
Upgrade DT Efficiency
• S-7 Transformer production
banned - January 1999
• Network reconstruction
increasing demand
• Utility restructuring may increase
focus on distribution efficiency
More Efficient S-9 DT Sales
Increased to 90% of Annual
Demand
Restructuring and Reform Driving
Change
• Emphasize quality & efficiency
• Capitalization of losses
• Tighter specifications
• Supplier Qualifications
• Performance certification
Reform Provides Opportunity
for Energy Efficiency in Select
SEBs
…Efficiency Gains Can Be Achieved
7/16/2015 - 10
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
In-Country Initiatives
China
India
• AMT research & production
• IIEC CEEP - catalyst for DT
increasing - Science & Tech.
efficiency
– In-country manufacturers seeking
• WB demonstration to lower
technology upgrade and
distribution losses
international partnerships
• ICA program catalyst for industrial
– Financial institutions prepared to
DT replacement
support EE investments for
manufacturing and purchase
– Target SEBs identified DT
reliability and efficiency as top
priority
Enormous Opportunity Remains Untapped
7/16/2015 - 11
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Actions Needed
• Utilities adopt TOC or Life-cycle costing purchase
practice
• Government establishes policies to encourage EE
transformer investments
• Manufacturers expand EE transformer capability
and capacity - In Country/Foreign Partnerships
• Financing programs for EE investments
Multi-Prong Strategies Needed to Transform Market
7/16/2015 - 12
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Summary
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Distribution transformer demand increasing
47 Billion kWh potential untapped savings
Electric utilities largest end-use segment
No TOC evaluation / 1st Cost purchasing
Barriers prevent EE DT market penetration
Utility reform & restructuring presents opportunity to
change market dynamics
• In-country initiatives are catalyst for improvement
Efficiency Gains Can Be Achieved - Action Required
7/16/2015 - 13
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Science, Research and Development
European Commission
Value
52 Million MT CO2
47 Billion kWh
US $3.0 Billion
Government, Manufacturers, Society Win-Win
7/16/2015 - 14
ENERGY, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT