Thailand’s experiences in the power sector

Chuenchom Sangarasri Greacen Chris Greacen, Ph.D.

Palang Thai

International Seminar on Dams and Sustainable Energy 24 March 2005 Melia Hotel, Hanoi, Vietnam

Overview

• Energy consumption and economic development • Thai government’s energy strategies • Current practices and consequences of Thai power sector planning – Load growth forecast – Power development plan (PDP) – GMS Grid • An alternative to the supply-driven power sector planning • Thailand’s abundant clean energy opportunities – 8% target – Potential – Examples

Thailand compared with Vietnam

Population GDP per capita (PPP)

Thailand

65 million $7,400 GDP growth (2003 est.) 6.7%

Vietnam

83 million $2,500 7.2% GDP by sector Electricity consumption Agriculture: 10% Industry: 44% Services: 46% 90 billion kWh Source: CIA World Factbook, 2005 Agriculture: 22% Industry: 40% Services: 38% 28 billion kWh

1,000 900 800 700 600 500 400 300 200 100 -

Thailand’s power consumption growth outstrips economic growth

Electric Power Generation per GDP

United States Canada United Kingdom Germany Taiwan Singapore Thailand Australia Malaysia South Korea Japan Peru 1971 1973 1980 1985 1990 1995 1999

Thai government has set a target for energy elasticity

1.0 (2008)

Ratio of GDP growth to electricity demand growth in Thailand

Thailand GDP growth Electricity consumption growth Ratio of GDP to power demand growth 1992-2002 2003-2016 1.45 times 1.84 times 2.02 times 2.39 times 1.4

1.3

* Source : EGAT’s Power Development Plan 2003 ** Source : Electricity Demand Forecast Report, January 2004

January 2004 Demand Forecast Ye ar 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 9 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 2 0 1 6 Av e rag e (2 5 4 7 - 2 5 4 9 ) GDP (%) 6 .5 % 6 .5 % 6 .5 % 6 .5 % 6 .4 % 6 .4 % 6 .6 % 6 .5 % 6 .5 % 6 .5 % 6 .4 % 6 .5 % 6 .4 % 6 .5 % MW De mand Gro w th 1 9 ,6 0 0 inc re as e / y e ar MW % 1 ,4 7 9 8 .2

2 1 ,1 4 3 2 2 ,7 3 8 2 4 ,3 4 4 2 6 ,0 4 8 2 7 ,8 5 2 2 9 ,8 0 8 3 1 ,8 4 4 3 3 ,9 4 5 3 6 ,1 7 3 3 8 ,5 1 5 4 0 ,9 7 8 4 3 ,5 5 8 1 ,5 4 3 1 ,5 9 5 1 ,6 0 6 1 ,7 0 4 1 ,8 0 4 1 ,9 5 6 2 ,0 3 6 2 ,1 0 1 2 ,2 2 8 2 ,3 4 2 2 ,4 6 3 2 ,5 8 0 7 .9

7 .5

7 .1

7 .0

6 .9

7 .0

6 .8

6 .6

6 .6

6 .5

6 .4

6 .3

1 ,9 5 7 7 .0

% o f Villag e s e le c trifie d Av g . pas t 1 0 y rs (2 5 3 7 - 2 5 4 6 ) Av g . pas t 1 5 y rs (2 5 3 2 - 2 5 4 6 ) Av g . pas t 2 0 y rs (2 5 2 7 - 2 5 4 6 ) A c t u a l 3 .6 % 5 .6 % 6 .2 % 8 3 9 8 4 5 7 6 7 6 .6

8 .5

9 .1

9 8 %

 99%

8 9 %

 99%

6 5 %

 99%

Past peak demand projections tended to over-estimate 55,000 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Jun-93 Dec-94 Oct-95 Apr-96 Oct-96 Jun-97 Sep-97 Sep-98(RER) Sep-98(MER) Sep-98(LER) Feb-01 Aug-02 Jan-04(LEG) Jan-04(MEG) Jan-04(TEG) ACTUAL

Power Development Plan

( Planned installed capacity = peak demand + 15 % reserve )

Regional Power Grid

• Main agenda of regional cooperation • Claimed benefits: – Increased reliability, shared power reserves – Energy transfer among member countries with different peak periods, resources – Savings of

1,377 – 2,554

MW new capacity avoided (Source: ADB’s GMS Grid Master Plan)

2020 Peak Demand in GMS Countries

Source

: Norconsult,

Indicative Master Plan on Power Interconnection in GMS Countries

, June 2002

ADB’s Interconnection Master Plan for GMS countries

Source

: Norconsult,

Indicative Master Plan on Power Interconnection in GMS Countries

, June 2002

Reality of GMS Power Grid: expensive, risky investment

US$billion Project cost 43.50 - 44.96

Cost savings* % benefit of total cost 0.45 - 0.91

1.0 – 2.1%

*Cost savings of extended power cooperation scenarios over base case • Costs excluded in analysis: – Control center – Water usage – Regulator & reliability coordination – Transitional costs • Increased vulnerability: events in Laos/Cambodia determine reliability of Thai Grid Source:

Comments on Indicative Master Plan on Power Interconnection in GMS Countries

by Bretton W. Garrett, P.Eng., Ph.D.

US$10 billion overinvestment

The public is bearing high electricity costs as a result of THB 400 billion (US$10 billion) over investment of in power generation.

-- Thai Prime Minister Thaksin Shinawatra Source: The Nation (2003). “PM Pressing for Egat IPO this year’.

The Nation.

March 14.

There is an

alternative

to the supply-driven, capital-intensive power sector planning

Revised Peak Demand Forecast

Jan 04 Forecast Adjustments to Jan 04 forecast (MW) Forecast (revised) Year 2547 2548 2549 2550 2551 2552 2553 2554 2555 2556 2557 2558 Assumed per annum GDP growth rate

6.5% 6.5% 6.5% 6.5% 6.4% 6.4% 6.6% 6.5% 6.5% 6.5% 6.4% 6.5%

Peak Demand (MW) 19,600 21,143 22,738 24,344 26,048 27,852 29,808 31,844 33,945 36,173 38,515 40,978 Use actual 2004 peak as base (19,326)

-274 -296 -318 -340 -364 -389 -417 -445 -475 -506 -538 -573

GDP Growth = 5.6% (average past 15 yrs)

0 -35 -110 -227 -373 -577 -903 -1280 -1731 -2277 -2897 -3652

Demand : GDP = 1:1

0 -259 -482 -629 -797 -962 -1113 -1252 -1343 -1428 -1519 -1565

Peak Cut (according to EGAT’s PDP 2004) Total Adjust- ment (MW)

0 0 -500 -500 -500 -500 -500 -500 -500 -500 -500 -500

Peak Demand (MW)

-274 19,326 -590 20,553 -1411 21,327 -1696 22,648 -2034 24,014 -2429 25,423 -2933 26,875 -3477 28,367 -4048 29,897 -4711 31,462 -5454 33,061 -6290 34,688

Projects under construction/negotiation

EGAT’s PDP 2004 Alternative PDP

Thermal Kra Bi #1 Gas Turbine Lan Kra Bue Lum Ta Kong hyfro dam #1-2 BLCP Power #1-2 Gulf Power Generation 340.0

122.0

500.0

1,346.5

700.0

Ratchaburi Power #1-2 SPP (renewable) SPP (old power purchase declaration) Nam Thuen 2 in Laos 1,400.0

151.1

60.0

920.0

MW MW MW MW MW MW MW MW MW Thermal Kra Bi #1 Gas Turbine Lan Kra Bue Lum Ta Kong hyfro dam #1-2 BLCP Power #1-2 Gulf Power Generation Ratchaburi Power #1-2 SPP (renewable) 340.0

122.0

500.0

1,346.5

700.0

1,400.0

151.1

MW MW MW MW MW MW MW MW total 5539.6 MW total 4619.6 MW

New Projects

EGAT’s PDP 2004

4 Repowering plants 20 New power plants RPS total 2,485 MW 13,770 MW 770 MW 17,025 MW

Alternative PDP

Non industrial -DSM -Renewable Energy total Industrial -DSM -Renewable energy (RPS 5%) -Cogeneration -Repowering total 500 1,800 MW MW 2,300 MW 1,000 390 MW MW 2,500 4,310 MW MW 8,200 MW total 10,500 MW

Cleaner, more economic, more efficient sources of supply are not given due consideration despite high potential

Cogeneration COGEN

Demand-side Management and energy efficiency Wind, solar, micro hydropower, biogas, biomass, etc.

Combined power and heat (CHP) or co-generation

DSM & Cogeneration: big potential

• DSM –

2000 to 3000 MW

• : “Achievable and cost effective DSM” in 1991 (Utility study) IIEC (International Institute for Energy Conservation). 1991.

Demand Side Management for Thailand’s Electric Power System: Five-Year Master Plan

Bangkok, Thailand. November.

. Submitted to Electricity Generating Authority of Thailand, Metropolitan Electricity Authority and Provincial Electricity Authority, Bangkok, Thailand. • Cogeneration –

8610 MW

cogen installed as of 2001 • http://www.jxj.com/magsandj/cospp/2002_05/cogen_southeast_asia.html

– Since 1998, utilities accepting no new cogen. At least 3,000 MW of additional cogen had applied and have not been accepted.

Hourly electricity load duration curve (year 2002)

MW

16000 14000 12000 10000

2001 PEAK = 16,126 MW

8000 16300 16100 15900 15700 15500 15300 15100

> 1,000 MW in 66 hours

6000 4000 2000 0 0 1000 2000 3000 4000 5000 6000 7000 8000

hours

Renewables account for very little of Thailands’ installed generating capacity

Imported coal

0.6% grid-connected renewables

Big hydro Fuel oil lignite Natural gas

พลังน ้ำ ก๊ำซธรรมชำติ น ้ำมันเตำ ดีเซล ลิกไนต์ ถ่ำนหินน ำเข ้ำ พลังงำนหมุนเวียน สำยส่งเชื่อมไทย-มำเลเซีย

TOTAL: 26,000 MW

Source: EGAT (2003). Power Development Plan

Thai government target: 8% renewable energy by year 2011

Conventional energy 81% 2002 52,939 KTOE

TE 16.5%

TE = Traditional Energy

NRE 0.5% (265 ktoe)

NRE = New & Renewable Energy

TE 11%

Conventional energy 81%

NRE 8% (6,668 KTOE)

2011 83,354 KTOE

Thai government target & strategy for renewable energy

Electricity Solar 6 MW Wind 0.2 MW Biomass 560 MW RPS INCENTIVE Electricity 1,170 KTOE

-

RPS 437 MW - Solar 200 MW Wind 100 MW

-

MSW 100 MW - Hydro 37 MW Incentive 1,093 MW -Biomass -Hydro Heat ~ 0.00 KTOE

RE 0.5% RE 8% Heat

(Incentive) 3,900 KTOE ~ Bio fuel 0.00 KTOE R & D Facilitator Bio Fuel (Incentive) 1,600 KTOE Ethanol 3.0 M liter/day Bio diesel 2.4 M liter/day 2002 2011

Replacement of imported oil 48 mill. barrels values 96,537 Mill. Baht

Estimate of installed grid-connected renewables in Thailand (2004)

Resource

Biogas

Capacity (MW)

7 Biomass Small & micro-hydro Solar PV Wind 215 (to grid) (not including 419 MW self-gen) 139 1.2

0.7

TOTAL 363

Source: 2003 Thai government figures + updates for biogas & PV based on recent installations

Estimated renewable energy potential in Thailand

Resource Biomass (includes biogas) Solar PV Wind Micro- & Mini- hydro Technical potential (MW) 7,000 >5,000 1,600 700 Commerical Potential* (MW) >4,300 ?

?

>200 Year 2011 Government targets (MW) 1140 250 100 350 Total >14,000 >4,500 1840

* Commercial potential based on actual prices paid to renewable energy generators currently on-line Source: Technical potential and Targets from Thai Ministry of Energy. (2003).“Energy Strategy for Competitiveness” http://www.eppo.go.th/admin/moe-workshop1/index.html

. Commercial potential from from Black & Veatch 2000 and NEPO/DANCED 1998 as well as interviews with power plant managers.

Breakdown of economically viable

Biomass resource

biomass resource

Economic potential (MW) Bagasse Biogas (cassava, pig, food waste) Wood residues Rice husk Corncob Distillery slop Coconut Palm oil residues TOTAL 1900 1185 950 100 54 49 43 43 4,324

Source: Black and Veatch (2000). Final Report: Thailand Biomass-Based Power Generation and Cogeneration Within Small Rural Industries. Bangkok, NEPO; NEPO/DANCED (1998). Investigation of Pricing Incentive in a Renewable Energy Strategy -- Main report. Bangkok. Bagasse figure from interview with interview with Sirisak Tatong, power plant manager at Mitr Phol sugar factory. Biogas from interviews with biogas developers

Technology is available…

• Steam turbines for direct combustion of biomass – Rice husk, wood chip, palm husk, bagasse, coconut husk, etc.

– Size >1 MW – Capital cost $1200/kW – Commercially available in Thailand • Bio-digestors & engines for biogas – Pig manure, cassava, palm oil, municipal wastes, distillery slop – Size > 30 kW – Problems with SO 2 resolvable • Gasifiers – Rice husk, wood chip – Size > 50 kW.

– Problems with tar in some fuels – Commercially available for wood chip

Biogas from Pig Farms

Reduces air and water pollution Produces fertilizer Produces electricity

Biogas from Pig Farms

Community micro-hydro

• Mae Kam Pong village, Chiang Mai • 40 kW • Community cooperative • Expected gross revenues: 30,000 baht/month

40 kW micro-hydro generator at Mae Kam Pong

Korat Waste to Energy - biogas

• Uses waste water from cassava to make methane • Produces gas for all factory heat (30 MW thermal) + 3 MW of electricity • Earns high market returns • Developer estimates 300 MW from waste water + 800 MW from wet cake

Korat Waste to Energy - biogas

• 3 x 1 MW Jenbacher gas generators

Thank you

For more information, please contact [email protected]

[email protected]

กัน Proposed reform for Thailand’s power sector

EGAT (Thermal Generation) ~ 15,000 MW Power Purchase IPP/Egco/Ratch/SPP ~ 10,000 MW New generation (distributed generation/ community-owned/ renewables) New Generation (Private sector) Transmission Utility (EGAT Transmission) Transmission System Operation Hydropower Distribution Utilities (MEA/PEA) Distribution Supply/Retail * Existing demand ~ 19,000 MW New demand (residential/smal l businesses/ others) New demand (large users) *

Communities and local bodies have the right to manage and procure their own power supply if they wish. MEA/PEA provide distribution services but do not monopolize the system use.

The “alternative PDP”: a response to the problems of supply-driven planning process

EGAT PDP • Excessive electricity demand prediction • Little consideration of clean/cost-effective alternatives Alternative PDP • Correct errors; revise demand based on historic growth • Incorporate DSM, cogeneration, and renewable energy