Transcript The Future of SAPP, WAPP, CAPP, and EAPP – With Inga

The Future of SAPP, WAPP,
CAPP, and EAPP – With Inga
IEEE GM 2005
San Francisco
June 15, 2005
PURDUE UNIVERSITY
F. T. Sparrow
Brian H. Bowen
Zuwei Yu
1
Establishment
of Africa’s
Power Pools
2
Sub-Sahara Regional MW Totals
Power
Pool
CAPP
EAPP
SAPP
WAPP
Total
Total Existing
Generation
(MW)
4,561
3,092
42,324
8,579
58,556
Sub-Sahara
Generation
(Percentage)
8%
5%
72%
15%
100%
3
Southern African Power Pool
SAPP – well along
in their Operation
(1995)
SAPP Major new
lines for increased
trading
4
West African Power Pool
WAPP – moving into
Operational phase (2000)
WAPP Major new lines
for increased trading
5
Central African Power Pool
WAPP
Sao
Tome
& Pr.
13
Egypt
15
16
Tchad
Guinée
Eq.
Cameroun
7
3
4
Gabon
RCA
6
8
Congo
Rwanda
5
12
RDC
60 MW
Key:
11
55 MW
10
2005 Existing Lines
Proposed New Lines
Future New Lines
9
Angola
350 MW
1
SAPP-West
EAPP now in the
process of identifying
needed HV lines
(2005)
250 MW
Burundi
EAPP
2
17
SAPP-East
14
18
Node1 Angola
Node2 Burundi
Node5 Congo
Node6 Gabon
Node9 RDCest
Node10 RDCsud
Node15 West Africa Node16 Egypt
Node14 Southern Africa via Zambia
Node3 Cameroon
Node4 Chad
Node7 Guinee Eq
Node8 RCA
Node11 RDCouest
Node12 Rwanda
Node 17 East Africa
Node 18 Southern Africa via Angola
DRC-Inga with
future exports
to SAPP, WAPP,
EAPP, Egypt
6
East African Power Pool
EAPP Just getting
organized expecting
a launch late 2005
7
Proposed Future Africa Grid
•
International transmission
links within power pools
• International transmission
links between pools
• During next 10 years
development of lines
CAPP to SAPP &WAPP
CAPP to Egypt & EAPP
CAPP becomes central link
with vital role for Inga site
8
North American Trading
Between Interconnects
• System designed for reliability, not economy trades
• Result – very little load carrying capability
between regions
Pacific DC HV Inter-Tie
3,100MW, 800miles
9
Total Gross Transactions
Between 4 NERC Regions
Interface
NEPOOL to NYPP
NYPP to NEPOOL
Net, NYPP to NEPOOL
NYPP to MAAC
MAAC to NYPP
Net, MAAC to NYPP
MAAC to ECAR
ECAR to MAAC
Net, ECAR to MAAC
Total Gross Transactions, Four
NERC Regions
Peak Demand
(MW)
27
888
861
1,261
1,684
422
969
3,908
2,939
8,737
Trade represents 8.8% of total U.S. peak demand
10
The Feasibility of Grand Inga
•The underlying question – is there enough
demand in Africa to justify the enormous
up-front dam construction cost?
• The average historic demand growth has
averaged about 2% per year over the last
ten years
• Is there enough suppressed demand to
justify the much higher growth rates
projected by member nations?
11
Forecast Growth in Electricity Demand
1993-2002
Average Historical
Growth for:Egypt = 2.6%
Nigeria = 2.4%
S. Africa = 1.4%
Forecasting 5% +
Demand
(MW)
Target
Current
Suppressed
Demand
i
1
Realistic supply
Constrained growth
i = Target rate of growth
History
What are low and
high scenarios?
Time
Now
12
Assumptions for Inga
Feasibility Analysis
• All demand growth in likely export markets for
Inga (SAPP, WAPP, EAPP, Egypt) will be met by
Inga power, not local construction
• Growth rates in the range of 2% to 4% per year
• Electricity will be sold at 3.5 cents/kWh (otherwise
markets will generate their own electricity)
• Inga construction and transmission line costs are
$16 Billion
• The cost of capital is 10%
13
Demand Values & Export Revenues
58,556MW
+ Egypt capacity
18,000MW
= 76,556MW total
Assume base year demand with 80% capacity factor
= (76,556 x 0.8 x 8,760) MWh
Year 1 revenues resulting from increase in demand
growth of 2%, electricity price of $30/MWh
= $(76,556 x 0.8 x 8,760 x 0.02 x 30.0) = $322M
14
Inga – Question & Answer
Q: When will the annual net revenues from
export sales cover the annual capitalized
cost of the Inga project?
A1: Never if the growth rate is 2%
A2: In 19 years if the growth rate is 4%
Does this mean Inga should be abandoned?
NO – Just broken down into smaller pieces
15
Inga Annual Net Revenue Stream
16
Growth in Demand & Cost of Capital
With economies of scale in
construction and a given growth rate
in demand, “the higher the cost of
capital, then the smaller will become
the optimal size of each installation”
Alan Manne
Stanford University
17
Low & High Demand Growth Rates
Demand
& Capacity
Demand
& Capacity
Time
Low Growth
High Interest Rates
Time
High Growth
Low Interest Rates
18