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National Electrification Master Plan for Lesotho Final Report

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National Electrification Master Plan for Lesotho Final Report The Government of Lesotho National Electrification Master Plan for Lesotho Final Report October 2007 The Government of Lesotho National Electrification Master Plan for Lesotho Final Report October 2007 Report no. 64131-0-13 Issue no. 3.2 Date of issue 20 October 2007 Prepared NBP Checked DH/ABR/CW/GB Approved NBP National Electrification Master Plan for Lesotho - Final Report 1 Table of Contents 1 Executive Summary 6 1.1 Introduction 6 1.2 Electrification Target 6 1.3 Settlements 7 1.4 Load Forecast 8 1.5 Technical Standards 9 1.6 Systems in Remote Areas 10 1.7 Transmission System 11 1.8 Distribution Systems 11 1.9 Financial Aspects 13 1.10 Prioritisation of Settlements 14 1.11 Project Schedule Years 1 to 5 - Distribution 15 1.12 Project Schedule for Years 6 - 15 - Distribution 18 1.13 Allocation of Responsibilities 19 1.14 Future Service Models for Electricity Supply 21 1.15 Tariffs and Connection Fee 21 1.16 Subsidies 22 1.17 Institutional Development and Training 23 1.18 Monitoring and Evaluation Framework 23 1.19 Environmental Issues 25 2 Introduction 27 2.1 Electrification Target for Lesotho 27 2.2 Balancing Policy Objectives 28 2.3 Planning Criteria and Approach 29 2.4 Report Structure and Terminology 32 3 Background 34 3.1 Context 34 3.2 Energy Policy and Power Sector Reform 35 3.3 Institutions Involved in Electrification 37 3.4 Existing Power System 42 P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 2 4 Socio-Economic Data and Analysis 51 4.1 Demography and Settlement Identification 51 4.2 Poverty Mapping and Energy Demand Surveys 62 4.3 WAP Studies for Electricity 63 4.4 Social Impact of Household Electrification 65 4.5 Conclusions Regarding Socio-Economic Information 66 5 Load Demand Forecast 70 5.1 Methodology and General Assumptions 70 5.2 System Load Curve and Losses 71 5.3 Residential Sector 72 5.4 Other Customer Groups 73 5.5 Load Forecast 74 6 Electrical Design Issues 79 6.1 Technical Standards used in LEC 79 6.2 Power Supply Quality 81 6.3 Recommendations 82 7 Off-grid Power Supply Options and Standards 87 7.1 Decentralised Options 87 7.2 Centralised Options 88 7.3 Suitability of Power Supply Options in the Context of Lesotho 88 7.4 Standards 91 7.5 Supply of Off-grid Schemes 91 7.6 Cost per Settlement (Off-Grid) 97 8 System Design and Cost Estimates in Transmission and Distribution 98 8.1 Transmission System 98 8.2 Distribution System 104 8.3 Investment Costs 109 9 Economic and Financial Analyses 114 9.1 Financial Analyses 114 9.2 Results of the Financial Analysis 118 10 Prioritisation and Scheduling of Electrification Projects 121 10.1 Outline of Electrification Projects 121 10.2 Ranking of Settlements by Viability 122 P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 3 10.3 Outline of Settlements included in the Plan for the First Five Years 123 10.4 Outline of Settlements Included in the Plan for the Next 10 Years 129 10.5 Transmission System Reinforcement 131 10.6 Main Responsibilities for Implementation of the Plan 132 10.7 Connection Fee and Tariff 135 10.8 Densification Measures 136 10.9 Institutional Development and Training 137 10.10 Monitoring and Evaluation Framework 139 11 Future Service Delivery in Lesotho 143 11.1 Problems Facing the Power Sector 143 11.2 Inside the ST - Future Role of LEC 144 11.3 Concession Model Approach for Lesotho 145 11.4 Outside the ST Areas – Grid Connection 146 11.5 Delivery Models Off-grid 149 11.6 Conclusions 150 12 Environmental Issues 151 12.1 Impact and Mitigation 151 12.2 Impacts from Transmission and Distribution 152 Table of Appendices Appendix 1 – NEMP Reports Appendix 2 – References Appendix 3 – Price Levels for Transmission and Distribution Appendix 4 – Cost of Distribution Overview per Settlement Appendix 5 – Viability Score by Settlement Appendix 6 – Financial Model Appendix 7 – Settlements Ranked by Balance Price Appendix 8 – Load Forecast per Settlement Appendix 9 – Transmission Network Model for 2005 and 2020 Appendix 10 – Overview at Constituency Level Appendix 11 – Maps and Description of Settlements P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 4 Abbreviations ABC Arial Bundled Cables ACSR Aluminium Conductor Steel Reinforced ADMD After Diversity Maximum Demand AES Access to Electricity Study AfDB African Development Bank AGOA African Growth and Opportunity Act BEC-meter Budget Energy Controller - (Prepaid meter system) BOS Bureau of Statistics (Lesotho) CCA Community Council Areas DOE Department of Energy EAPPs Electricity Access Pilot Projects GOL Government of Lesotho GIS Geographical Information System HH Households HV High Voltage - a nominal phase-to-phase voltage between the range 11 kV and 132 kV both inclusive ICB International Competitive Bidding IEC International Electro-technical Commission IMTF Interim Management Task Force kV kilo Volt kWh kilo Watt hours LCB Local Competitive Bidding LDHS Lesotho Demographic and Health Survey, 2004 LEA Lesotho Electricity Authority LEC Lesotho Electricity Company LHDA Lesotho Highlands Development Authority LHWP Lesotho Highlands Water Project LURP Lesotho Utilities Reform Project LRMC Long Run Marginal Cost LSL Lesotho Maloti = 100 Lisente (l), 1 USD = 7.5 LSL LV Low Voltage MCB Miniature Circuit Breaker MHPP Muela Hydro Power Plant MNR Ministry of Natural Resources MV Medium Voltage MW Mega Watt NEMP National Electrification Master Plan NREF National Rural Electrification Fund P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 5 NREP National Rural Electrification Programme OHL Overhead Line OPGW Optical Grounding Wire PSIA Poverty and Social Impact Assessment RE Rural Electrification REF Rural Electrification Forum REU Rural Electrification Unit REWG Rural Electrification Working Group RSA Republic of South Africa SABS South African Bureau of Standards SPV (or PV) Solar Photovoltaic ST Service Territory TNA Training Needs Assessment WASA Water and Sewerage Authority WAP Willingness to Pay WB World Bank XLPE Cross-linked polyethylene P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 6 1 Executive Summary 1.1 Introduction The objective of this National Electrification Master Plan Study (NEMP) is to provide clear guidelines and establish priorities for providing access to electric- ity in Lesotho in a co-ordinated and cost-effective manner, which will enable the Government of Lesotho (GOL) to meet its electrification targets in particu- lar, and rural development goals in general. The NEMP study has been organ- ised in three distinct steps: 1 Inception; 2 Electrification Master Planning; 3 Electrification Master Plan Implementation Strategy. This Final Report presents the outcome and results of the study. 1.2 Electrification Target The target of the Government of Lesotho is to ensure that in 2020 at least 40% of all households have access to electricity either from the national power grid, from an isolated system or from individual solutions (solar PV/generators). The table below shows the projection of population and number of households in Lesotho and specifies the number of electrified households required to achieve the electrification target. Table 1-1 Population, households and electrification targets Year 2005 2010 2015 2020 Total population 2,200,000 2,300,000 2,320,000 2,320,000 Total number of households 564,000 590,000 595,000 595,000 Electrification level 8% 20% 35% 40% No. of domestic customers 42,610 118,000 208,000 238,000 Source: Consultant's calculations. The electrification level of 2005 as well as the projections are based on an average household size of 3.9 P:\64131A\3_Pdoc\DOC\Final Report\færdige\Final Report October 2007\Final Report\Final Report-october.doc . National Electrification Master Plan for Lesotho - Final Report 7 Briefly, the number of electrified households should increase from 42,000 to 238,000. This corresponds to an annual average of new connections of ap- proximately 13,000. Currently, 5,000-6,000 new customers are added annually to the system. The commercialised LEC is foreseen to connect 8,000 new cus- tomers within its service territory (ST). Through the Rural Electrification Unit (REU), the Government is foreseen to be in charge of the remaining. In order to achieve this goal, Lesotho faces two main challenges: (1) to moti- vate LEC to fulfil their commitment, and (2) to establish a parallel structure that can plan for and handle approximately 5,000 connections per year outside the ST. This National Electrification Master Plan provides a framework for the actions over the next 15 years, including the following: • The cluster approach (see Section 1.3) identifies large and viable planning areas for electrification of Lesotho over the next 15 years; • The plan establishes a clear priority of settlements to be electrified; • The plan includes an estimate of the investment and operational cost of the plan using recommended technologies and projects; • The plan demonstrates that considerable subsidies are required for its im- plementation; • The plan clearly identifies the role and responsibilities of LEC, REU, Le- sotho Electrification Authority (LEA) and Department of Energy (DOE); • The plan provides a capacity building framework that will enable the key players to fulfil their role. 1.3 Settlements The viability of the constituencies and type of settlement has been used as a starting point for the ranking of the settlements to be electrified.
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