Transcript Slide 1

ELECTRIC SECTOR TRANSFORMATION PROGRAM
(PTSE)
18th A.P.U.A. Congress
Luanda – September 11th 2014
João Saraiva
PTSE Manager Coordinator
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
1
AGENDA
1. Angola’s Power Sector
2. Electric Sector Transformation Program
and Market Model
3. PTSE Phases and Progress
4. Future Perspectives
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
2
Angola’s Power Sector
2025 Goals
The Presidential Decree 256/11 established a set of objectives for the electricity sector,
reinforcing the importance of electricity to the country.
Ensure and
Increase
Electricity
Supply
i
 Increase the electricity rate from 30% to 60%
 Quadruple generation capacity from current ~2.0 GW para ~9.5 GW in 2025
 Extend more than 2.500 km of lines and substations in the transmission grid,
and establish international interconnections
 Rehabilitate distribution networks, adding more than 1.5 million consumers
Industry
Competitiveness
 Improve the efficiency of public companies
 Implement a new market model that allows for cost reductions
 Develop a new regulatory model encouraging efficiency
System
Sustainability
 Reduce tariff subsidization
 Develop an optimal generation mix, making better use of Angola’s natural
resources
 Develop the capabilities of the local workforce
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
3
Angola’s Power Sector
Sector challenges and progress
To successfully achieve the proposed goals in the energy sector a large amount of
investment is necessary in generation assets and grid infrastructure.
Installed capacity
Transmission grid
(GW)
(Kilometers)
10.0
9,5 GW
0.78
8.0
6,9 GW
x4
6.0
3.0
5,500
5,000
5,000
1.60
4,000
0.43
1.50
0.0
0,88 GW
1.10
0.33
0.55
0.87
2002
2013
2,000
2.5
3,354
1.5
x1.5
1.2
1.0
2,051
4.83
2017
2025
Other Renevables
Combined Cycle
Conventonal Thermal
Hydro
1,000
0.5
0
0.0
2003
2013
2.4
x3
2.0
3,000
6.88
2,0 GW
(Millions)
6,000
4.0
2.0
# Consumers
2017
2025
0.8
0.2
2002
2013
2017
2025
Source: 2002 Data – Development of a Energy Strategy , IEA; 2013 Data – MINEA Expanded Council Board; Financial Reports ENE e EDEL;
2017 and 2025 estimated data - PSEA 2009
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
4
Angola’s Power Sector
Electrification enhancers
Angola is managing large, concurrent infrastructure developments, carefully planned to take
advantage of Angola's national resources – natural gas, hydro, wind and solar.
SIMPLIFICATION
CONGO
CABINDA
ZAIRE
North
System
UIGE
L. NORTE
K. NORTE
LUANDA
BENG
O
East
System
MALANJE
SE.
Cambambe*
SE. Capanda
elevadora
L. SUL
K. SUL
Center
System
MOXICO
BENGUELA
HUAMBO
 Benefit from the hydro potential of
Kwanza river – Laúca and CaculoCabaça
 Install combined cycle gas
turbines, partnering with
Sonangol/ Angola LNG
 National integration of
transmission systems
 International interconnection with
Namibia and Congo
HUILA
NAMIBE
How to take advantage of
Angolan natural resources
South
System
K. KUBANGO
CUNENE
NAMIBIA
Grid connections
until 2025
 Rural electrification with
distributed renewables sources
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
5
AGENDA
1. Angola’s Power Sector
2. Electric Sector Transformation Program
and Market Model
3. PTSE Phases and Progress
4. Future Perspectives
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
6
Electric Sector Transformation Program
Goals
In addition to infrastructure investments, MINEA considered necessary to establish a package
of initiatives to allow a progressive restructuration and a orderly development of the Power
Sector, by creating PTSE.
Other Initiatives (non exhaustive)
Expand the distribution network – rural
(Solar Village) and urban
Expand the pre-payment model
Establish public-private partnerships
Electric Sector Transformation
Program (PTSE)

Restructure the current organizational model

Ensure economic and financial sustainability
of the system

Promote the entry of private capital

Strengthen the regulator role in the new
Market Model
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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Electric Sector Transformation Program
Institutional reform of public companies
The Electricity Sector Transformation Program (PTSE) seeks to improve efficiency by unbundling
activities and a new market regulation that allows private participation.
Restructuring of Public Companies
Value Chain
Generation
Current status
Future status
Private
Investors
Private
Investors
Transmission National
Company
Transmission
Distribution and
Customer
Operations
Generation National
Company
Municipalities
Distribution National
Company
Private
Concessions
Regulation
Engineering
Engineering Office
(for strategic projects)
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
8
Electric Sector Transformation Program
Institutional reform of public companies
PTSE Includes organizational and corporate restructuring, leading to the establishment of
three new public companies, one per phase of electricity value chain.
Generation
Generation
Engineering Office
(for strategic
projects)
Distribution
Distribution
Transmission
Generation
Transmission
Distribution
Generation National
Company
Transmission National
Company
Distribution National
Company
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9
New Market Model
Principles and agents
The design principles considered in the definition of the new model are listed below:
Design
Principles
 Strengthen the regulator role (IRSE)
 Competitive processes for both public and private generation
 Independent Transmission Operation, also acting as Single Buyer for all
electricity generated in Public Electric System (SEP)
 Long-term Power Purchase Agreements (PPA)
 “Merit order” for generation dispatch based on PPAs
Public Private
Generation Generation
Wholesale seller
Expected
Results




Transmission
Single Buyer
Market Operator
Distribution
Wholesale buyer
Market opening (ex.: generation and distribution)
Promote the entry of private capital
Greater transparency and competitiveness among companies
New tariff model to reduce system costs and subsidies
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
10
New Market Model
Market economic model
The new sector configuration is supported by the new market model defined in Regulation,
increasing the control of the economic flows and energy supply.
Generation and billing
of energy supplied to
Single Buyer
Transmission and billing
of energy supplied to
Distribution
Distribution and billing
to AT, MT, BT customers
ENERGY SUPPLY FLOW
Public and Private
Generation
I
R
S
E
Transmission
(Single Buyer)
PPAs
Prices
Distribution
Uniform
Prices
Customers
AT BT Pre-payment
MT BT Post-payment
Regulated
Tariff
PAYMENT FLOW – AGENT RETRIBUTION
Market Operator
pays Generators
Distributor pays Market
Operator (MO)
MO operates the Compensation Fund
and pays Distributor
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Customers pay
Distributor
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New Market Model
Tariff composition
Tariffs are calculated by adding the real cost of the Agents. The Government is subsidizing
the final tariff in order to not charge the customers with the high system costs.
Exploration
Costs
Additive
tariff
Investment
Retribution
TRANSMISSION
Exploration
Costs
GENERATION
Exploration
Costs
Investment
Retribution
SECTOR COSTS
DISTRIBUTION
SIMPLIFIED
Pays the
generatio
n total
costs
PPAs*
Prices
Investment
Retribution
GENERATION
TO
TRANSMISSION
Billing
Segment specific costs
Energy cost of immediately preceding step of the value chain
Pays the
transmissio
n total
costs
Regulated
Price
TRANSMISSION
TO
DISTRIBUTION
Billing
Pays the
distributio
n total
costs
Regulated*
Tariffs
Subsidy to
customer
Tariff
DISTRIBUTION TO
CUSTOMER
Billing
* PPA prices negotiated between Market Operator and each Generator, with IRSE
supervision and Regulated Tariffs fixed by the Government, with IRSE supervision
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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AGENDA
1. Angola’s Power Sector
2. Electric Sector Transformation Program
and Market Model
3. PTSE Phases and Progress
4. Future Perspectives
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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PTSE Phases and Progress
PTSE’s phased plan
PTSE is structured in three phases. At the moment is about to finish the second one, by the
establishment of the new public companies for the power sector.
1. Diagnostic,
Mobilization and
Change
Management
2. Electric Sector
Restructuring
(Unbundling)
 Confirmation of the expected market model
i
CONCLUDED
 Identification of open / pending issues
 Communication to companies senior management
 Release of restructuring and change
 Restructuring of IRSE, GAMEK and Public Companies
CONCLUDING
 Market model & regulation and IRSE training
 Capability development of the electric sector
 Implementation plan of operational improvements
 Program and change management
3. Operational
and Functional
Improvement of
Public
Companies
 Detailed design of the new operating model
2014-2016
 Pilots in reference areas
 Effective implementation of operational improvements of the new
companies :
•
Focus on the most critical areas
•
Progressive rollout along geographies and isolated systems
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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PTSE Phases and Progress
Phase III executive summary – Operational Improvements
Locations until August 1st 2014
PROVINCE
OF LUANDA
 Cazenga Thermal Power Plant
 Viana Transmission Substation
 Viana (EDEL) technical and
commercial area
PROVINCE
MALANJE
• Technical operational improvements
• The establishment of a Work Orders Programming Centre in order to reduce
failures resolution time
• Commercial operational improvements
 Benguela Area
 Catumbela Area
 Baía Farta Area
TRANSMISSION
DISTRIBUTION
BENGUELA
 Lobito Area
• Actions over supply chain to ensure the availability of the parts and to reduce storage costs
• Maintenance management to reduce unavailability times and increase assets
productivity and lifetime
OF
OF
• Actions over maintenance and operations plans of critical assets to increase their
availability
• Permit to work coordination in the system operator (CONS) to increase the system
availability
 Capanda
Hydric Power
Plant
PROVINCE
GENERATION
Generation
• On field identification of consumers and contract regularization to improve
electricity readings and to increase income
Transmission
• Optimization of commercial functions to reduce service times and improve
customer service
Distribution
• Definition of Pre-payment and Agent models
IRSE - REGULATION
NOTE: During 2014 is foreseen the launch
of new pilots in other provinces.
• Statistical information systematization and tariff analysis
• Concession contracts development
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
15
AGENDA
1. Angola’s Power Sector
2. Electric Sector Transformation Program
and Market Model
3. PTSE Phases and Progress
4. Future Perspectives
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
16
Future Perspectives
Levers of efficiency
TO DISCUSS
Some levers are available to increase sector efficiency and to reduce costs:
Stabilization
Transition to efficiency
Partial liberalization
2014-2017
2018-2021
2021-2025
Review and adjustment of Electric System Regulations (IRSE)
1. Tariff Model
• Increase tariffs
2. Commercial cycle
improvement
• Pre-payment
• Meters in all consumer
points
3. Reduction of acceptable
system costs
• Implementation of more
demanding benchmarks
To have all the supply points
measured and tariffs more
representative of the real costs
1
2
4. Reduction of system costs
• Reduction of energy losses
transferable to the tariffs
5. Adjusts of tariff models
• Balance between the
variable and fix terms
• Price curves for qualified
clients
6. Change in the retributive
model
• Change for a retribution
model by incentives
• Include incentives for the
losses reduction
6
3
5
4
7. Sector restructuration
• Public-private partnerships
• Concessions of distributions
areas to private companies
8. Reduction of system costs
• Cheaper energetic mix
• Coexistence of PPAs and
market pool
7
8
Sustainable
companies,
service
quality and
efficiency
Controlled costs and new
retributive model defined. High
control power from IRSE
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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Future Perspectives
Sustainability
In conclusion, PTSE is one of the building blocks to achieve maturity and sustainability in the
Angolan Power Sector.
Economic
Sustainability
Social
Sustainability
Environmental
Sustainability

Establish new electricity market conditions

Reduce governmental tariff subsidization

Develop regulation capabilities to promote efficiency

Management professionalization

Expand rural electrification, boosting growth and development in these
regions

Ensure long-term sustainability and independence of local capabilities
(human and technological)

Deliver results to society in the short term

Adopt a better installed capacity mix focused on Angola’s natural resources

Choose thermal power plant technologies with reduced CO2 emissions

Develop pilot projects to expand renewable energies

Promote electricity efficiency with mass installation of prepayment meters
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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EMPRESA PÚBLICA DE PRODUÇÃO
DE ELECTRICIDADE
Thank you
João Saraiva
REDE NACIONAL DE TRANSPORTE
DE ELECTRICIDADE
EMPRESA NACIONAL DE
DISTRIBUIÇÃO DE ELECTRICIDADE
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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National Policy and Strategy for Energy Security
Framework
National Policy and Strategy for Energy Security define the main strategic guidelines for the
sector, specially for Electricity, Oil and Natural Gas.
January 2009
Establishment of the Interministerial Commission for Energy Security of Angola
 Strategy and Energy Policy of Angola and Energy Security Plan of Angola
 Institutional Model of the Energy Supply Industry and Oil Sector
November 2011
Approved Presidential Decree n.º 256/11 - National Policy and Strategy for Energy Security
Organized in the following chapters:
 Importance of transformation required in the Electric System
 Strategic guidelines for electricity Subsector
 Strategic guidelines oil and natural gas subsectors
 Environmental sustainability
 Institutional model recommended for energy system
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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National Policy and Strategy for Energy Security –
Electricity Subsector
Electric Subsector goals are focused on increasing the electrification rate, by ensuring
electricity supply to large part of the population
Strategic Guidelines for Electricity
Subsector
 Strongly increase the power generation pool and enhance the role of renewable
energy
 Connect North, South and East Systems
 Expand electrification (urban and rural) covering from 50% to 60% of population in 2025:
 Ensure the economic - financial sustainability (Tariffs cover 20% of the costs)
 Rearrange the current organizational model, through the creation of public entities ,
for generation, transmission and distribution/commercialization
 Strengthen the Regulator role – IRSE (Electricity Sector Regulatory Institute) and the
AREA (Atomic Energy Regulatory Agency)
 Promote the entry of private capital and construction and operation capabilities
(know-how) and define engaging compensatory systems for private investors
 Establish partnership between National Generation Company and Sonangol to provide
the Centrals with Natural Gas.
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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Electric Sector Transformation Program
Planning by phases
2013
2012
J
Phase I
F
M
A
M
J
2014
J
Phase II
A
S
O
N
D
J
F
M
Transition
A
M
J
J
A
S
O
N
D
2015
2016
Phase III
Companies startup follow-up and transition
Diagnostic
Electric Sector Restructuring
(Unbundling)
Phase I and II
Prioritized improvements in
Distribution
(quick – wins)
Transition
 Current Capabilities
Diagnostic
 Corporate Constitution, Feasibility study and
Financial statement Support
 Public Companies
Restructuring, IRSE e
GAMEK
 Organization and Allocation Preparation
 Market Model
 Development of
Power Sector
Capabilities and IT
roadmap
 Change
Management
 Company staffing and salaries equalization
model
 Market set-up
 Operation Market Simulation
 Tariffs study
 CAE1 and CAR2 determination
 Actual IT System Adaptation and Start Up
Operative procedures definition
Operational and Functional Improvement of
Public Companies, GAMEK and IRSE
Quick-wins e Phase III (2014)
 Operative improvement in Technical and
Commercial Areas, with short-term results in
commercial cycle and customer service
 Pre-payment and Agent Models Definition
 Focus on maintenance planning of transmission
and distribution key assets, to increase the
availability
 Improvements in Support Corporative areas
 Progressive rollout along geographies and isolated
systems
 SAP implementation to support HR, finance,
procurement and logistics.
1) CAE – Contrato de Aquisição de Energia; 2) CAR – Contrato Comercial de Acesso às Redes
© 2014. All rights reserved. Do not reproduce or allow access to third parties without prior authorization from the Ministry of Energy and Water - Republic of Angola.
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