JBICI Research Paper No.18
Regional Cooperation Strategy on Interconnected Power Networks in Indochina
August 2002
JBIC Institute Japan Bank for International Cooperation
JBICI Research Paper No. 18 Japan Bank for International Cooperation (JBIC) Published in August 2002 © 2002 Japan Bank for International Cooperation All rights reserved.
This Research Paper is based on the findings and discussion of the JBIC Institute (JBICI). The views expressed in this paper are those of the authors and do not necessarily represent the official position of the JBIC. No part of this Research Paper may be reproduced in any form without the express permission of the publisher. For further information please contact the Planning and Coordination Division of our Institute.
Foreword
This research project is intended to examine the feasibility of interconnected power networks, which play an important role in power sector cooperation, in Cambodia, Laos, Thailand and Vietnam in the Indochina region, identify conditions and issues for the realization of the system interconnection, and make recommendations on future strategies to the governments.
The countries and various organizations, as we have seen, have carried out many studies on the power sectors of the region and reported the effectiveness of the system interconnection. However, the economic benefit from the system interconnection, particularly from system reliability improvement, has not been identified quantitatively. In this report, we measure the benefit of the system interconnection in monetary terms with the analytical tools commonly used in Japan, and examine the financial viability of the networks.
We believe this study bridges the missing part and makes a further step for the realization of the interconnected power networks in Indochina, and hope this report provides valuable information and viewpoints not only to persons involved with the Indochina region, but also persons who are interested in developing strategies and regional cooperation on system interconnections in developing countries.
Finally, I would like to express our deep appreciation for the cooperation and advice offered by the governments of Cambodia, Laos, Thailand and Vietnam, their agencies and various Japanese institutions that have made this survey possible.
August 2002 Koji Fujimoto Executive Director JBIC Institute Japan Bank for International Cooperation
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(JBIC Institute) Masaya Kawaguchi Researcher, Development Policy Research Division, JBIC Institute
(Survey Team) Noboru Seki Planning Manager, Engineering Department, Tokyo Electric Power Company, Inc. Masahiko Tada Group Manager, Transmission System Department, Overseas Business Center, Tokyo Electric Power Services Co., Ltd. Yasuhiro Yokosawa Manager, International Project Development Group, Transmission & Substation Construction Department, Tokyo Electric Power Company, Inc. Nobuya Maekawa Manager, International Project Development Group, Transmission & Substation Construction Department, Tokyo Electric Power Company, Inc.
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Contents
Foreword ････････････････････････････････････････････････････････････････････ ⅰ Contents ････････････････････････････････････････････････････････････････････ ⅲ List of Tables ････････････････････････････････････････････････････････････････ ⅴ List of Figures ･･･････････････････････････････････････････････････････････････ ⅶ Acronyms and Abbreviations ･･････････････････････････････････････････････････ ⅸ Map of Indochina ････････････････････････････････････････････････････････････ ⅻ
Executive Summary ･････････････････････････････････････････････････････････ S-1
Chapter Ⅰ Introduction ･･････････････････････････････････････････････････････ 1 1.1 Background and Purpose ････････････････････････････････････････ 1 1.2 Study Methodology ･････････････････････････････････････････････ 1 1.3 Framework of the Study and Report ･･････････････････････････････ 2
Chapter Ⅱ Present State and Future Plans of the Power Sectors ･････････････････ 3 2.1 Present Social Situation ･････････････････････････････････････････ 3 2.1.1 Summary of the Present Social Situation ････････････････････ 3 2.1.2 Economic Situation ････････････････････････････････････････ 4 2.1.3 Potential Energy Resources ････････････････････････････････ 7 2.2 Present Situation and Future Plans of the Power Sectors ･･････････ 11 2.2.1 Cambodia ････････････････････････････････････････････････ 11 2.2.2 Laos ････････････････････････････････････････････････････ 20 2.2.3 Thailand ････････････････････････････････････････････････ 28 2.2.4 Vietnam ･････････････････････････････････････････････････ 35 2.3 Support of Various Organizations for the Power Sectors ･･･････････ 44 2.4 Studies on the System Interconnection in the Indochina Region･････ 45
Chapter Ⅲ Plan for the Interconnected Power Networks in Indochina ････････････ 47 3.1 Study Methodology ････････････････････････････････････････････ 47 3.1.1 For System Reliability Aspects ･････････････････････････････ 47 3.1.2 For Fuel Cost Aspects ･････････････････････････････････････ 50 3.1.3 For Financial Analysis ････････････････････････････････････ 52 3.2 Definition of the Interconnected Transmission Line ･･･････････････ 52 3.3 Feasibility of the Interconnected Transmission Line Project ･･･････ 53 3.3.1 Results on the System Reliability Aspects Study ･････････････ 53 3.3.2 Results on the Fuel Cost Aspects Study ･････････････････････ 66 3.3.3 Economic Performance Comparison ････････････････････････ 79 3.3.4 Verification of the Benefits through the System Interconnection up to 2020 ････････････････････････････････ 82 3.3.5 Results on the Financial Analysis ･･････････････････････････ 90 3.3.6 Application to Rural Electrification ････････････････････････ 97
Chapter Ⅳ Conditions, Issues, and Recommendations ･････････････････････････ 102 4.1 More Beneficial Plans for the System Interconnection ････････････ 102 4.1.1 Confirmation of the Benefits from the System Interconnection ･ 102 4.1.2 Proposals for the More Beneficial Plans for the System Interconnection ･･････････････････････････････ 102 4.2 Conditions, Issues, and Recommendations for the Realization of the System Interconnection ･･･････････････････････････････････ 104
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4.2.1 Conditions and Issues for the Realization of the System Interconnection Benefits ･･････････････････････････････････ 104 4.2.2 Recommendations for the Implementation of the System Interconnection ･････････････････････････････････････････ 111
Chapter Ⅴ Support for the Realization of the System Interconnection ･･･････････ 113 5.1 Introduction ･････････････････････････････････････････････････ 113 5.2 For Analysis of the Present Situations and Planning of the System Interconnection ･･･････････････････････････････････ 113 5.3 For Arrangement the Necessary Conditions ･････････････････････ 113 5.4 For Construction, Operation and Maintenance of the Inter connected Transmission Line ･････････････････････････ 114
Chapter Ⅵ Closing Remarks ････････････････････････････････････････････････ 116
(Appendix Example of Japan) Chapter A1 Wide Area Coordinated Operation in Japan ････････････････････････ 117 A1.1 System Interconnection in Japan ････････････････････････････････ 117 A1.2 Wide Area Coordinated Operation ･･･････････････････････････････ 117 A1.3 Outline of the Wide Area Coordinated Operation ･･････････････････ 118 A1.3.1 Power Exchange for Mutually Balancing Demand and Supply ･･ 118 A1.3.2 Wide Area Mutual Cooperative Exchange Power ･･････････････ 118 A1.3.3 Power Exchange for Economical Operation ････････････････････ 119 A1.4 New Economical Exchange System ･･･････････････････････････････ 119 A1.4.1 Schedule ･････････････････････････････････････････････････････ 119 A1.4.2 Method for Selecting Companies ･･･････････････････････････････ 120 A1.4.3 Accounting ･･･････････････････････････････････････････････････ 120
Chapter A2 Hokkaido and Honshu Power Interconnection ･･････････････････････ 121 A2.1 Wide Area Coordinated Operation System ････････････････････････ 121 A2.2 Operation of the Hokkaido Honshu HVDC Link ･･･････････････････ 121 A2.3 Expense Sharing System ･･･････････････････････････････････････ 121 A2.4 Use Charge ････････････････････････････････････････････････････ 122
References ････････････････････････････････････････････････････････････････ 123
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List of Tables
Table 2-1 Present Situation of the Indochina Region ････････････････････ 3 Table 2-2 Main Power Plants in Cambodia ･･･････････････････････････ 16 Table 2-3 Power Plant Development Plan in Cambodia ･･･････････････ 17 Table 2-4 Main Hydropower Plants in Laos ･･･････････････････････････ 24 Table 2-5 Thailand’s System Installed Capacity ･･･････････････････････ 31 Table 2-6 Vietnam’s System Installed Capacity ･･･････････････････････ 39 Table 2-7 Power Plant Development Plan in Vietnam ･･････････････････ 41 Table 3-1 System Reliability of the Target and the PDP Base in 2015 ･･･ 53 Table 3-2 Maximum Power Demand and Installed Capacity (Base Case, 2015) ･････････････････････････････････････････ 54 Table 3-3 Available Reserve Capacity Saving in 2015 ･･････････････････ 66 Table 3-4 Unit Construction Cost and Unit Fuel Cost ･･････････････････ 66 Table 3-5 Annual Cost (Base Case, 2015) ･････････････････････････････ 67 Table 3-6 Annual Cost (Case 1, 2015) ････････････････････････････････ 68 Table 3-7 Annual Cost Saving (Case 1, 2015) ･･････････････････････････ 68 Table 3-8 Energy Generation Change (Case 1, 2015) ･･･････････････････ 68 Table 3-9 Annual Cost (Case 2, 2015) ････････････････････････････････ 69 Table 3-10 Annual Cost Saving (Case 2, 2015) ･･････････････････････････ 69 Table 3-11 Energy Generation Change (Case 2, 2015) ･･･････････････････ 69 Table 3-12 Annual Cost (Case 3, 2015) ････････････････････････････････ 70 Table 3-13 Annual Cost Saving (Case 3, 2015) ･･････････････････････････ 70 Table 3-14 Energy Generation Change (Case 3, 2015) ･･･････････････････ 70 Table 3-15 Annual Cost (Case 4, 2015) ････････････････････････････････ 71 Table 3-16 Annual Cost Saving (Case 4, 2015) ･･････････････････････････ 71 Table 3-17 Energy Generation Change (Case 4, 2015) ･･･････････････････ 71 Table 3-18 Annual Cost (Case 5, 2015) ････････････････････････････････ 72 Table 3-19 Annual Cost Saving (Case 5, 2015) ･･････････････････････････ 72 Table 3-20 Energy Generation Change (Case 5, 2015) ･･･････････････････ 72 Table 3-21 Annual Cost (Case 6, 2015) ････････････････････････････････ 73 Table 3-22 Annual Cost Saving (Case 6, 2015) ･･････････････････････････ 73 Table 3-23 Energy Generation Change (Case 6, 2015) ･･･････････････････ 73 Table 3-24 Annual Cost (Case 7, 2015) ････････････････････････････････ 74 Table 3-25 Annual Cost Saving (Case 7, 2015) ･･････････････････････････ 74 Table 3-26 Energy Generation Change (Case 7, 2015) ･･･････････････････ 74 Table 3-27 Annual Cost (Case 8, 2015) ････････････････････････････････ 75 Table 3-28 Annual Cost Saving (Case 8, 2015) ･･････････････････････････ 75 Table 3-29 Energy Generation Change (Case 8, 2015) ･･･････････････････ 75 Table 3-30 Annual Cost (Case 9, 2015) ････････････････････････････････ 76 Table 3-31 Annual Cost Saving (Case 9, 2015) ･･････････････････････････ 76 Table 3-32 Energy Generation Change (Case 9, 2015) ･･･････････････････ 76 Table 3-33 Annual Cost (Case 10, 2015) ･･･････････････････････････････ 77 Table 3-34 Annual Cost Saving (Case 10, 2015) ････････････････････････ 77 Table 3-35 Energy Generation Change (Case 10, 2015) ･･････････････････ 77 Table 3-36 Overview of the Interconnected Transmission Line and Construction Cost ･････････････････････････････････････････ 78 Table 3-37 Economic Performance Comparison in 2015 (15 years, 15%) ･･･ 79 Table 3-38 Economic Performance Comparison under Different Conditions 80 Table 3-39 Maximum Power Demand and Installed Capacity (Base Case, 2020) ･････････････････････････････････････････ 82 Table 3-40 Available Reserve Capacity Saving in 2020 ･･････････････････ 85 Table 3-41 Annual Cost (Base Case, 2020) ･････････････････････････････ 85
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Table 3-42 Annual Cost (Case 2, 2020) ････････････････････････････････ 86 Table 3-43 Annual Cost Saving (Case 2, 2020) ･･････････････････････････ 86 Table 3-44 Energy Generation Change (Case 2, 2020) ･･･････････････････ 86 Table 3-45 Annual Cost (Case 5, 2020) ････････････････････････････････ 87 Table 3-46 Annual Cost Saving (Case 5, 2020) ･･････････････････････････ 87 Table 3-47 Energy Generation Change (Case 5, 2020) ･･･････････････････ 87 Table 3-48 Annual Cost (Case 7, 2020) ････････････････････････････････ 88 Table 3-49 Annual Cost Saving (Case 7, 2020) ･･････････････････････････ 88 Table 3-50 Energy Generation Change (Case 7, 2020) ･･･････････････････ 88 Table 3-51 Annual Cost (Case 10, 2020) ･･･････････････････････････････ 89 Table 3-52 Annual Cost Saving (Case 10, 2020) ････････････････････････ 89 Table 3-53 Energy Generation Change (Case 10, 2020) ･･････････････････ 89 Table 3-54 Economic Performance Comparison in 2020 (15 years, 15%) ･･･ 90 Table 3-55 Financial Analysis (FIRR, 2015) ････････････････････････････ 95 Table 3-56 Financial Analysis (FIRR, 2020) ････････････････････････････ 96 Table 3-57 Demand in the Special Economic Ward and Other Areas in Savannekhet ･･･････････････････････････････････････････ 99 Table 4-1 Annual Cost Saving of the Top Four Cases in 2015 ･･････････ 103 Table 4-2 Annual Cost Share of the Top Four Cases in 2015 ･･･････････ 103 Table 4-3 Annual Cost Saving (Case 2, 2010) ･････････････････････････ 106 Table 4-4 Energy Generation Change (Case 2, 2010) ･･････････････････ 107
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List of Figures
Figure 1-1 Framework of the Study and Report ･････････････････････････ 2 Figure 2-1 Daily Load Curve of the Phnom Penh system in Cambodia ････ 12 Figure 2-2 Demand Forecast in Cambodia (the WB’s Study) ･････････････ 13 Figure 2-3 Maximum Power Demand Forecast (Cambodia) ･･････････････ 15 Figure 2-4 Electric Energy Forecast (Cambodia) ････････････････････････ 15 Figure 2-5 Transition of the EdC’s System Loss ････････････････････････ 18 Figure 2-6 Transitions of Maximum Power Demand and Electric Energy in Laos ････････････････････････････････････ 21 Figure 2-7 Daily Load Curve of the Vientiane system in Laos ････････････ 22 Figure 2-8 Maximum Power Demand Forecast (Laos) ･･･････････････････ 23 Figure 2-9 Electric Energy Forecast (Laos) ････････････････････････････ 23 Figure 2-10 Transition of Generating Capacity in Laos ･･･････････････････ 25 Figure 2-11 Transition of Domestic Sold Electric Energy in Laos ･･････････ 25 Figure 2-12 Household Electrification Rate in Laos ･･････････････････････ 28 Figure 2-13 Transition of Maximum Power Demand and Electric Energy in Thailand ････････････････････････････････ 29 Figure 2-14 Daily Load Curve in Thailand ･･････････････････････････････ 30 Figure 2-15 Maximum Power Demand Forecast (Thailand) ･･･････････････ 31 Figure 2-16 Electric Energy Forecast (Thailand) ････････････････････････ 31 Figure 2-17 Transition of Installed Capacity in Thailand ･････････････････ 32 Figure 2-18 Transition of the Total Loss of Generation, Transmission, and Distribution ･･････････････････････････････････････････ 33 Figure 2-19 Transition of an Electrification Rate in Households ･･･････････ 35 Figure 2-20 Transition of Maximum Power Demand and Electric Energy in Vietnam ････････････････････････････････ 36 Figure 2-21 Daily Load Curve in Vietnam ･･････････････････････････････ 36 Figure 2-22 Transition of Energy Sales in Vietnam ･･････････････････････ 37 Figure 2-23 Maximum Power Demand Forecast (Vietnam) ･･･････････････ 39 Figure 2-24 Electric Energy Forecast (Vietnam) ･････････････････････････ 39 Figure 2-25 Transition of Installed Capacity in Vietnam ･････････････････ 40 Figure 2-26 Transition of Transmission and Distribution Loss ････････････ 42 Figure 3-1 Calculation of the LOLE ･･･････････････････････････････････ 48 Figure 3-2 Relationship between the LOLE and Reserve Margin ･････････ 48 Figure 3-3 Interconnection Transmission Line ･････････････････････････ 52 Figure 3-4 Installed Capacity and Generation Composition Based on the PDP in 2015 ･･････････････････････････････････････････ 54 Figure 3-5-0 Base Case ････････････････････････････････････････････････ 55 Figure 3-5-1 Case 1: Thailand – Laos Vietnam ･･･････････････････････････ 55 Figure 3-5-2 Case 2: Thailand Laos Vietnam (with Generating Units) ･･････ 56 Figure 3-5-3 Case 3: Thailand Cambodia Vietnam ････････････････････････ 56 Figure 3-5-4 Case 4: Cambodia Vietnam ････････････････････････････････ 57 Figure 3-5-5 Case 5: Thailand Laos Cambodia Vietnam (with Generating Units) ･･･････････････････････････････････ 57 Figure 3-5-6 Case 6: Thailand Laos Cambodia (with Generating Units) ････ 58 Figure 3-5-7 Case 7: Thailand Laos Vietnam Cambodia (with Generating Units) ･･･････････････････････････････････ 58 Figure 3-5-8 Case 8: Thailand Laos Vietnam Cambodia (with Generating Units) ･･･････････････････････････････････ 59 Figure 3-5-9 Case 9: Cambodia Laos ････････････････････････････････････ 59
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Figure 3-5-10 Case 10: Thailand Laos Vietnam Cambodia Laos (with Generating Units) ･･･････････････････････････････････ 60 Figure 3-6 Reserve Capacity Reduction (Case 1, 2015) ･･････････････････ 60 Figure 3-7 Reserve Capacity Reduction (Case 2, 2015) ･･･････････････････61 Figure 3-8 Reserve Capacity Reduction (Case 3, 2015) ･･･････････････････62 Figure 3-9 Reserve Capacity Reduction (Case 4, 2015) ･･･････････････････62 Figure 3-10 Reserve Capacity Reduction (Case 5, 2015) ･･････････････････ 63 Figure 3-11 Reserve Capacity Reduction (Case 6, 2015) ･･････････････････ 63 Figure 3-12 Reserve Capacity Reduction (Case 7, 2015) ･･････････････････ 64 Figure 3-13 Reserve Capacity Reduction (Case 8, 2015) ･･････････････････ 64 Figure 3-14 Reserve Capacity Reduction (Case 9, 2015) ･･････････････････ 65 Figure 3-15 Reserve Capacity Reduction (Case 10, 2015) ･････････････････ 65 Figure 3-16 Hydropower Potential in the Laos System ･･･････････････････ 81 Figure 3-17 Weekly Operation of the Laos System in the Rainy Season ････ 81 Figure 3-18 Weekly Operation of the Thailand System in the Rainy Season ･ 82 Figure 3-19 Reserve Capacity Reduction (Case 2, 2020) ･･････････････････ 83 Figure 3-20 Reserve Capacity Reduction (Case 5, 2020) ･･････････････････ 83 Figure 3-21 Reserve Capacity Reduction (Case 7, 2020) ･･････････････････ 84 Figure 3-22 Reserve Capacity Reduction (Case 10, 2020) ･････････････････ 84 Figure 3-23 Image of the Interconnected Transmission Line Project ･･･････ 92 Figure 3-24 Relationship between Power Exchange Amount and Unit Fuel Cost Difference (Case 5) ･･････････････････････････ 93 Figure 3-25 Relationship between Revenue and Unit Charge (Case 5) ･････ 93 Figure 3-26 Relationship between Power Exchange Amount and Unit Fuel Cost Difference (Case 2) ･･････････････････････････ 94 Figure 3-27 Relationship between Revenue and Unit Charge (Case 2) ･････ 94 Figure 3-28 Comparison with Recovery Cost ･･･････････････････････････ 100 Figure 4-1 Reserve Capacity Reduction (Case 2, 2010) ･････････････････ 106 Figure 4-2 Demand Divergence Between Thailand and Vietnam ････････ 109 Figure 4-3 Reserve Capacity Reduction (Case 1, 2015, Including Demand Divergence) ･･････････････ 109 Figure 4-4 Case 11: Yunnan Thailand Laos Vietnam – Cambodia (with Generating Units) ･･････････････････････････････････ 110 Figure 4-5 Reserve Capacity Reduction (Case 11, 2015) ････････････････ 111 Figure 5-1 Annual Cost Share Comparison of Commercial and Public Loan ･ 115 Figure A1-1 System Interconnection in Japan ･･････････････････････････ 117
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Acronyms and Abbreviations
ADB Asian Development Bank ASEAN Association of South East Asian Nations BOT Build, Operate and Transfer CCGT Combined Cycle Gas Turbine CEEP Committee for Energy and Electric Power CEPC Central Electric Power Council Cigre Conseil International des Grands Réseaux Électriques (in French) International Council on Large Electric Systems (in English) CLDLO Central Load Dispatching Liaison Office DSM Demand Side Management DSS Daily Start & Stop EAC Electricity Authority of Cambodia EDC Electricite du Cambodge EDL Electricite du Laos EDP Electricite de Province EGAT Electricity Generating Authority of Thailand EGCO Electricity Generating Public Company Limited EPDC Electric Power Development Co., Ltd. EREPC Eastern Regional Electric Power Council ERLDLC Eastern Regional Load Dispatching Liaison Committee ERLDLO Eastern Regional Load Dispatching Liaison Office EUE Expected Undelivered Energy EVN Electricity of Vietnam FIRR Financial Internal Rate of Return FFC Flat Frequency Control F/S Feasibility Study FTC Flat Tie line Control GDP Gross Domestic Product GMS Greater Mekong Subregion GNP Gross National Product GT Gas Turbine HPP Hydro Power Plant HVDC High Voltage Direct Current IDE-JETRO Institute of Development Economies - Japan External Trade Organization IE Institute of Energy IMF International Monetary Fund
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IPP Independent Power Producer JBIC Japan Bank for International Cooperation JEPIC Japan Electric Power Information Center, INC. JETRO Japan External Trade Organization JICA Japan International Cooperation Agency JV Joint Venture LLDC Least Less Developed Countries LNCE Lao National Committee for Energy LOLE Loss-of- Load Expectation LOLP Loss-of-Load Probability MEA Metropolitan Electricity Authority MEF Ministry of Economy and Finance (Cambodia) MIME Ministry of Industry, Mines And Energy (Cambodia) MIH Ministry of Industry and Handicrafts (Laos) MOI Ministry of Industry (Vietnam) MOU Minute of Understanding MP Master Plan NEDO New Energy and Industrial Technology Development Organization NEPO National Energy Policy Office NLDC Northern Load Dispatching Center O&M Operation & Maintenance PEA Provincial Electricity Authority PDPAT Power Development Planning Assist Tool PPA Power Purchase Agreement PPSs Power Producer and Suppliers PRGF Poverty Reduction and Growth Facility PT& D Power Transmission & Distribution Project RETICS Reliability Evaluation Tool for Inter-Connected System SADEP Special Assistance for Development Policy and Projects SAPROF Special Assistance for Project Formation SCADA system Supervisory Control And Data Acquisition system SPP Small Power Plant SPREP Southern Provincial Rural Electrification Project SSGT Single Cycle Gas Turbine ST Steam Turbine TA Technical Assistance TBC Tie line load frequency Bias Control TCF Tera Cubic Feet TEPCO Tokyo Electric Power Company TLFS Thailand Load Forecast Subcommittee
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TNB Tenaga National Berhad TPP Thermal Power Plant WASP Wien Automatic System Planning Package WB World Bank
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Map of Indochina
Border Mekong River
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Executive Summary
Introduction
This research project is intended to examine the feasibility and future strategy of interconnected power networks in Cambodia, Laos, Thailand and Vietnam in Indochina as one of the regional cooperation efforts in its power sector. More concretely, the study measured the benefit of interconnected power networks in monetary terms, particularly focusing on the whole system’s reliability, examined the financial viability of the selected networks, identified conditions and issues for the realization of the network, and made recommendations on future strategies of the governments and donors’ assistance.
Evaluation of Benefit as the Whole Region
System Reliability
Improvement Effect
Economical Analysis
Evaluation of System Interconnection Project (Annual Cost Comparison)
Fuel Cost
Saving Effect
Benefit of Interconnected
Pow er Netw or ks
in Monetary Terms
Financial Analysis Financial Viability of
Feasibility of (FIRR) the Selected Netw orks
Interconnected Pow er
Netw orks in Indochina
Most Beneficial Plans
for Interconnected Power
Netw orks in Indochina
Future Strategies of
Wide-area Operation
the Governments and
(incl. Japan’s Experience)
Donors’ Ass istanc e
Conditions and Issues for the
Realization of Interconnected
Pow er Netw or ks in Indoc hina
Application to Rural Electrification Recommendation
Figure S-1 Framework of the Study
1. Present State and Future Plans of the Power Sector
Cambodia Laos, Thailand and Vietnam in Indochina are located in close proximity to each other, however, each level of economic development is widely different. Each power sector of the countries, as their economic conditions, is different in system scale, power demand, primary energy sources and so on.
S-1
According to the demand forecast of each country, the assumed average rate of annual demand growth in Cambodia and Laos, Thailand, and Vietnam are roughly 10% and more, 6%, and 9% respectively. Consequently, power demand in 2015 is considered to become seven times as large as that in 2000 in Cambodia, six times in Laos, 2.5 times in Thailand, and four times in Vietnam. To meet such demand, the power development plan of each country says that Cambodia will develop mainly domestic hydropower, Laos will cover all of domestic demand by hydropower, Thailand will develop mainly domestic thermal power and import hydropower energy from neighboring countries, and Vietnam will develop mainly gas-fired power. In brief, the countries are going to begin to develop their economical domestic primary sources for generation.
Table S-1 Record and Forecast of Power Demand, and Future Development Plans Cambodia Laos Thailand Vietnam
Actual Record 150 MW 172 MW 14,918 MW 4,477 MW (2000)
Forecast 694 MW 612 MW 38,519 MW 17,847 MW (2015) Planned Capacity
1,100 MW 790 MW 46,900 MW 25,800 MW
(2015)
8%
Hydro 13%
19%
26% 25%
Gas + Oil 31% 42%
Coal 100%
43% 56% 37%
Other
Note: “Other” includes power import from other countries.
2. Most Beneficial System Interconnection in Indochina
(1) Functions of a System Interconnection Functions of a system interconnection are divided roughly into two types, that is the improvement effect on system reliability and the saving effect on fuel cost. The improvement effect on system reliability means that interconnected transmission lines enable a system to avoid deterioration in power supply reliability with a interconnected system’s support (emergency power exchange) if a power shortage occurs due to a serious accident in a power plant or sudden increase in power demand, and therefore an interconnected system with other systems keeps its target system reliability with less amount of reserve capacity than capacity that an isolated system requires.
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The saving effect on fuel cost means that interconnected lines permit a system to reduce its fuel cost with an opportunity to import lower cost electricity from other countries (economical power exchange).
(2) Methodology for Measuring the Benefits This study compared the following 10 interconnection cases with the base case, which has no new international interconnected lines, in 2015. Since there are many transmission line projects resulting from new power plant development, including IPP (independent power producer) projects in Indochina, a transmission line exclusive for a new power plant with additional capacity for power exchange was adopted in some cases from the viewpoint of construction cost saving. To measure benefits mentioned above, the RETICS (Reliability Evaluation Tool for Inter-Connected Systems) and PDPAT (Power Development Planning Assist Tool) were used.
Figure S-2 Interconnection Cases
S-3
(3) Result on System Reliability Aspects System Reliability resulted in improving with a system interconnection in all the cases, and that enables each system to lessen its reserve capacity, in other words, to postpone some new power plants in 2015. As the table below shows the possible reduction of the case 4, 6 and 9, which have no connection between Thailand and Vietnam, is far smaller than that of the other cases, which have the connection. Therefore the linkage between the Thailand and Vietnam systems would have a great influence on the possible reduction of reserve capacity. In these cases, the expected amount is from 370 to 410 MW as for the whole interconnected systems.
Table S-2 Possible Reduction of Reserve Capacity Case # Transmission Capacity Possible Reduction of (MW) Reserve Capacity (MW) 1 1000 -370 2 1000 -370 3 1000 -390 4 100 -35 5 1000 -410 6 100 -100 7 500 -410 8 500 -410 9 100 -80 10 500 -410
(4) Result on Fuel Cost and Annual Cost Aspects The study confirmed that the system interconnection would produce a great cost saving in 2015 in all the cases, and the cases 2, 5, 7 and 10 were more beneficial. For example, a maximum of 63 million dollars was identified as an annual cost saving through a system interconnection on condition that a project life and a discount rate were 15 years and 15% respectively in case 2, and therefore the total saving for 15 years amounts 945 million dollars. The top four cases were also more beneficial even in the other conditions such as a project life of 20 or 25 years and a discount rate of 10 or 8%. In addition, this research project found that the cost saving effect would also persist and even increase in 2020 as a result of the verification to the four promising cases.
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Table S-3 Annual Cost Saving in 2015 (Project Life: 15 Years, Discount Rate: 15%) Unit: MUS$/yr Possible Construction and O&M Cost Annual Cost Case # Reduction Construction O&M Cost Loss Fixed Fuel Diff. (MW) Cost Cost Cost 1 -328 36 3 7 -27 -53 -34 2 -338 15 1 5 -29 -55 -63 3 -434 40 4 11 -43 -14 -2 4 -18 2 0 1 -2 -8 -7 5 -388 36 3 10 -40 -57 -48 6 -51 4 1 4 -7 -27 -25 7 -419 43 4 8 -39 -52 -36 8 -422 56 5 9 -40 -56 -26 9 -40 3 0 3 -10 -4 -8 10 -320 29 3 5 -30 -48 -41
(5) Characteristics of the Top Four Cases The top four cases have the next two characteristics in great economical efficiency. The first is the interconnection between the Thailand and Vietnam systems and the other is the use of discharged water without generating electricity in Laos for Thailand. The reason why these characteristics result in large benefits is the following. With respect to the Thailand and Vietnam systems interconnection, in an interconnection between large systems, since a large system requires large reserve capacity, the amount of their generating facilities that interconnected systems can utilize for emergency and economical power exchange with each other becomes also large. Therefore, a great amount of postponement of new power plants is permitted. On the other hand, when a large system interconnects with a small system, such as the Cambodia or Laos system, a small system limits the amount of its generating facilities available for the power exchanges. Consequently that interconnection brings little benefit to the whole interconnected systems. With respect to the use of discharged water without generating electricity in Laos for Thailand, the Laos system consists of hydropower only in generation and has to adjust power supply capacity to domestic power demand by only hydropower stations. Hydropower stations in Laos are, consequently, forced to discharge valuable water without generating mainly in the rainy season from the viewpoint of their reservoir operation, when domestic demand is below the total of generating capacity for domestic use. However, if the Laos system connects with other systems, Laos is able to make the use of such discharged water for other systems and to contribute to a fuel cost saving as the whole region through economical power exchange. As well as the first case above, an interconnection with a large and flexible
S-5
system is needed in order to make the most of discharged water without generating in Laos.
(6) More Beneficial System Interconnection From the preceding examinations on benefits of system interconnection, the following four cases are proposed as a more beneficial international system interconnection in the Indochina region.
Case 2: Thailand-Laos-Vietnam interconnection Case 5: Thailand-Laos-Cambodia-Vietnam interconnection in the shape of N Case 7: Thailand-Laos-Cambodia-Vietnam interconnection in the shape of a diamond Case 10: Laos-Vietnam-Cambodia triangle plus Thailand-Laos interconnection
Figure S-3 Proposed System Interconnections
3. Feasibility of Interconnected Transmission Lines Project in Indochina
(1) Methodology for Examining Project Viability This study identified that a system interconnection can bring great benefits such as system reliability improvement and a fuel cost saving, those benefits, however, are not directly connected with money income for power utilities. Therefore it is necessary to verify whether interconnected transmission lines project in Indochina is feasible development strategy. More concretely, the study examined the financial viability of the proposed power interconnections from the viewpoint of the FIRR (Financial Internal Rate of Return) under the following settings. (a) An entity independent from the states or state-owned power enterprises
S-6
implements the construction, operation and maintenance of interconnected transmission lines (e.g. a BOT project), (b) The entity is supposed to turn a profit only on charges for electric energy passing through the transmission line and to recover the project costs just from its revenue.
Total benefit is divided into A, B country and the company.
Figure S-4 Image of the Interconnected Transmission Line Project
(2) Result of Financial Analysis The result of this financial analysis in 2015 under the aforementioned conditions revealed that the FIRR was around 6% even in the best case (the case 2, a project term of 25 years, each country’s benefit of 0.5 cent per kWh and unit usage charge of 1.5 cent per kWh). A system interconnection has various positive effects such as an investment cost and a fuel cost saving, such effects, however, produce no cash inflow. Therefore it is considered to be difficult that an independent transmission company manages the project only with revenue from the charges for its transmission lines in 2015.
Table S-4 Result of Financial Analysis of the Case 2 in 2015 Unit Charges Project Life Operation from 2015 (¢/kWh) 25 Years 20 Years 15 Years 1.0 5.90% 4.78% 2.60%
1.5 6.37% 5.30% 3.19%
2.0 1.98% 0.43% -2.41%
2.5 1.50% -0.10% -3.03%
This result does not prove entirely the project itself impossible or unrealistic, the independent entity, however, would be forced to run into hard management,
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depending on financing conditions. In 2020, the FIRR stood at more than 15% in some cases, when each country’s benefit and unit transmission rates are set aptly. Accordingly it would be expected that the expansion of each power system in the region would increase opportunity of power exchange and improve the profitability of the interconnected transmission lines project.
(3) Rural Electrification In addition to the preceding examinations, this study explored the application of interconnected transmission lines to rural electrification. The retail price supplied directly from the interconnected lines is 10% lower than that supplied with normal way. Considering that rural electrification is a particularly important policy issue in developing countries, it would be worth examining in various areas in order to supply lower electricity and reduce consumers’ and government’s expense.
4. Recommendations, Conditions and Issues for the Realization of the System Interconnection in Indochina
(1) Recommendations The present study found that system interconnection would produce a lot of benefit, and, however, would not be profitable if an entity independent from the states or state-owned companies conducted an interconnected transmission lines project. This is because the cost saving effects mentioned in the previous sections are a sort of national economic benefit and does not connect cash inflow directly. Therefore an association of the related countries or state-owned companies who would receive the national economic benefit, such as investment and fuel cost saving in this study, should be considered as the most appreciate agency to construct, operate and maintain the interconnected transmission line. In addition, a council to discuss the fair cost and role sharing commensurate with each country’s benefit, proper transmission charges, the priority for the line and a complicated technical code for the interconnected system operation, and an executing facility for the fair operation would be also needed. The executing facility, however, should operate as an entity independent from the related countries or state-owned enterprises, and it would be important subjects to consider what function and commission should be given to the facility in consideration of operating modes for the interconnected transmission line.
(2) Issues and Conditions This research project revealed various economical benefits brought by the
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system interconnection, however there are some issues and conditions to derive those benefits fully.
(a) Fuel Cost Saving Effect Since the use of discharged water of the Loas system mainly in the rainy season has a great influence on the fuel cost saving effect through the system interconnection in the region, it is important to grasp the properties of existing and future hydropower plant in detail for the accurate examination of the fuel cost saving effect. The present study had to use some analogical data due to the lack of sufficient and detailed data on new hydropower development sites in Cambodia and Laos. Hydropower, however, is considerably sensitive to the geographical properties of its site by contrast to thermal power, and accordingly the analogical data may produce some errors in the end result. That is why particular and certain data based on the characteristics of development sites are essential.
(b) System Reliability Harmonization The LOLE was set at 24 hours as target system reliability for each country in this study, each country, however, has different system reliability at present. When systems with extremely different system reliability connect with each other, benefits from interconnection concentrate in systems with lower reliability. Specifically, system reliability as the whole interconnected systems improves, whereas systems which have higher reliability before a system interconnection may deteriorate in system reliability under the influence of the lower systems. Therefore each country should try to approximate to the same target system reliability.
(c) Domestic Transmission System Development This study presupposed that there are no limitations on capacity to transit electricity in a domestic transmission system and accordingly an interconnected transmission line connects between substations nearest the border of each country. Cambodia and Laos, however, has developed a national power network and Vietnam has restriction on the capacity of the transmission line between the northern and southern area. The future transmission development plan of each country should be made so that an inefficient domestic transmission network, though these countries will strengthen their domestic transmission systems according to the expansion of electricity demand, will not become a hindrance to system interconnection.
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(d) Coordination with a Transmission Lines Plan Exclusive for a New Power Plant It was aforementioned that if existing and future transmission development plans exclusive for power supply from a new power plant permit to increase their transmission capacity for power exchange and to use also as an interconnected transmission line, it is useful from the viewpoint of construction cost reduction. As the case 2, 5, 7 and 10, which were proposed as the most beneficial system interconnection plan in this study, are applicable to this case, the coordination with a transmission construction plan according to new power plant development is needed in order to realize the proposed cases. Concretely, it is necessary to decide or modify the capacity of a transmission line planned only for a power plant in light of the use for an interconnection line in the future.
5. Supports for the Realization of the System Interconnection in Indochina
(1) Analysis of Present Situations and System Interconnection As mentioned in the preceding section, Cambodia and Laos need sufficient and credible data on new hydropower development sites. In this connection, support for building the information gathering system on hydropower development site, existing hydropower plant operation and a meteorological phenomenon counts for something, because it is impossible to evaluate precisely and amply a plan for system interconnection without concrete data. Moreover, considering an interconnection with the Yunnan province of China, it would be also worth collecting data on the Yunnan system in detail and making an analysis of the interconnected power networks including the Yunnan power system. As regards the formation of a specific system interconnection project, a feasibility study on the proposed interconnection cases in this study should be conducted in order to deliberate closely the benefit and feasibility of the international system interconnection in Indochina.
(2) Arrangement of Necessary Conditions Besides the support above, assistance for preparing necessary conditions for each country and between countries, such as domestic transmission system development and the harmonization of each system reliability so that each country acquires the benefit of the system interconnection. As for the domestic transmission system development, software and hardware support for the formation of a national transmission network in Cambodia and Laos, and assistance for the reinforcement of the North-South transmission lines in Vietnam would be important. With respect to the harmonization of system reliability among the countries, the point would be how to establish a framework to consider and negotiate about
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interests of each country and a regional system reliability target. This topic is relevant to the management of the interconnected transmission lines, and is mentioned in the next section.
(3) Construction, Operation and Maintenance of the Interconnected Transmission Line The success of interconnected transmission project requires not only active participation and cooperation of the related countries but also the establishment of a council which coordinates interests and institute various rules on the construction, operation and maintenance of the project, an executing facility which performs fair operation, and the appropriate empowerment to them. The support concerning the above requirements is as followings.
(a) Hardware Support Hardware support, needless to say, is financial support for the construction of interconnected transmission lines and system operation facilities. According to the result of the following examination, the use of public loan reduced risk and share in the expenses of the project for each country considerably. In the case 2, for example, the annual cost in the case of using public loan resulted in half or less amount of that in the case of using commercial loan.
25.0 21.0 20.0
15.0 11.0 9.8 10.2 MUS$ 10.0
5.0
0.0 15 Years, 15.0% (Commercial) 130 Years, 1.0% (for Laos and Cambodia) 30 Years, 1.8% (for Vietnam) 30 Years, 2.2% (for Thailand)
Repayment Period, Interest Rate
Figure S-5 Annual Cost Comparison of Commercial and Public Loan
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(b) Software Support Software support is considered to be intellectual assistance on the policy of sharing the expenses for the interconnected transmission project, the method of setting the adequate transmission charges, the solution for issues on interconnected system operation, the rules and regulations in the operation, etc. When donors give such software assistance to developing countries, the related countries and the donors should discuss to the full what sort of wide area operation is most suitable in Cambodia, Laos, Thailand and Vietnam in the Indochina region in consideration of other countries’ or regions’ previous practices. In addition, considering electric power industry has a great dependence on its region, it is also needed to study the distinction of the Indochina region.
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Chapter I Introduction
1.1 Background and Purpose
Since the 1990s, multiple frameworks for wide-area development cooperation have been set up in the Indochina region and in the electric power sector. The countries in the region have drawn up and implemented a lot of projects for hydro and thermal electric power, power transmission and distribution networks, and rural electrification development in cooperation with each other. It is necessary for the countries to continue power sector development according to their plans that suit various conditions in each country in order to meet growing power demand hereafter brought about by the economic development. This will require not only measures by each country to build up its implementation systems and to encourage public-private partnerships, but also will require a regional cooperation strategy in order to develop the regional power sector effectively and efficiently. In line with this, this research project was intended to examine the feasibility and future strategy of interconnected power networks in Cambodia, Laos, Thailand and Vietnam in the Indochina region as one of the regional cooperation efforts in the power sector. Interconnected power networks, that is system interconnection, could be expected to play an important role in the stability of power supply, optimum power development and so on. The study on system interconnection among the countries was well worth conducting. More concretely, the study measured benefits of interconnected power networks in monetary terms, particularly focusing on the improvement of the whole system’s reliability, examined the financial viability of the selected networks, identified conditions and issues for the realization of system interconnection and its wide-area of operation, and made recommendations on future strategies of the governments and donors’ assistance.
1.2 Study Methodology
The flow of this research project follows: (1) Literature study of basic information on the Indochina region (Cambodia, Laos, Thailand and Vietnam) and its power sector (in Japan), (2) First field survey (September 16 to 29, 2001) in order to gather necessary data for examining a interconnected power networks plan in the region, (3) Examination and analysis of the plan on the basis of the collected information (See the detailed framework of the examination and analysis
1
in the next section), (4) Second field survey (November 25 to December 5, 2001) in order to explain to and discuss with the counterparts of each country the proposed interconnected power networks and the effects of those system interconnections, (5) Workshop on the draft study results reflected the discussions of the second field survey (in Bangkok, February 21 to 22, 2002), and (6) Final report.
1.3 Framework of the Study and Report
Figure 1-1 shows the framework of the study and the report.
Evaluation of Benefit as the Whole Region
System Reliability
Improvement Effect
(Section 3.3.1)
Economical Analysis
Evaluation of System Interconnection Project (Annual Cost Comparison)
(Section 3.3)
Fuel Cost
Saving Effect
Benefit of Interconnected (Section 3.3.2)
Pow er Netw or ks
in Monetary Terms
(Chapter III)
Financial Viability of
Financial Analysis
the Selected Netw orks Feasibility of (FIRR)
(Section 3.3.5)
Interconnected Pow er
Netw orks in Indochina
Most Beneficial Plans
for Interconnected Power
Netw orks in Indochina
Future Strategies of
(Section 4.1) the Governments and Wide-area Operation
Donors’ Ass istanc e (incl. Japan’s Experience)
(Chapter IV) Conditions and Issues for the
Realization of Interconnected
Pow er Netw or ks in Indoc hina
(Section 4.1)
Application to Rural Electrification (Section 3.3.6) Recommendation
Figure 1-1 Framework of the Study and Report
2 Chapter Ⅱ Present State and Future Plans of the Power Sectors
Basic information on the power sector in the four countries was essential for examining and planning the strategy to realize the system interconnection in Indochina. In line with this, this chapter shows the basic information collected from the literature study of existing materials on the power sector in the four counties, each country’s power development plan (PDP), and the latest materials and data gathered in the field surveys, consisting of visits to the relevant authorities, power stations, load dispatching centers and so on.
2.1 Present Social Situation
2.1.1 Summary of the Present Social Situation
Table 2-1 sums up the present social situation in the four countries of the Indochina region. Cambodia, Laos, Thailand, and Vietnam are geographically in close proximity to each other. However, economically they differ considerably in development. In terms of the gross domestic product (GDP) per capita, their level is still low in comparison with that of advanced countries, but significant growth in the Indochina region is expected in the near future. Similarly, there are great differences in demand scale, primary energy potential, and so on in the power sector, and also great possibilities in the future.
Table 2-1 Present Situation of the Indochina Region Cambodia Laos Thailand Vietnam Population (million persons) 11.40 4.95 61.47 77.68 Population Density (porsons/km2) 63 21 120 234 GDP (100 million $) 31 12 1,250 264 GDP/capita ($/person) 271 283 2,045 340 GNP/capita ($/person) 253 － － 372 Maximum Power Demand (MW) 123 165 14,918 4,477 Sold Energy (GWh/year) 627 639 96,780 26,000 Load Factor (%) 62 57 75 63 Electrification Rate (%) 20 34 82 72 Potential Hydropower Capacity (MW) 10 27 15 16 Petroleum Deposits (100 million barrels) 0.5~1.0 - 9 6 Gas Deposits (TCF) 1.5~3.5 - 33 5 Coal Deposits (100 million tons) - High 24 35 Potential Note: The year of each data is shown in section 2.1.2 and 2.1.3 Source: Ministry of Foreign Affairs (Japan) Official Web Site
3 2.1.2 Economic Situation1
(1) Cambodia As a result of the decrease in foreign support, and investment and in tourism earnings caused by the incident in July and the Asian Economic Crisis in 1997, the economy slipped from 3.5% in GDP growth rate in 1996 to 1.5% in 1998. The new administration, which is giving priority to the rehabilitation of the economy, has made serious efforts to tackle reforms in the financial sector, forest management, military, governance and the social sector, and holds regular monitoring sessions with the donors on the progress of these reforms. In 1999, the Cambodian economy turned around due to the restoration of political stability, and the GDP growth rate reached 6.7%. Cambodia achieved 5.4% in its growth rate despite the extensive damage from floods in 2000.
(a) Main industries: Agriculture (b) GDP: Approximately 3,090 million dollars (2000) (c) GNP per capita: 253 dollars (2000) (d) Price rise rate: 0.5% (2000) (e) Unemployment rate: Unknown (f) (i) Total value of trade (2000), (ii) main trade items (1998), (iii) main trading partners (1998) (Exports) (i) 1,050 million dollars (incl. re-exports: 110 million dollars) (ii) Tailored garments, timber, rubber, sea food, agricultural produce (soybean, maize, etc.) (iii) USA, Singapore, Thailand, Germany, China (Imports) (i) 1,430 million dollars (ii) Petroleum products, tobacco, gold, building materials, automobiles, electrical goods (iii) Thailand, Hong Kong, Singapore, China, Vietnam (g) Currency: Riel, $1 = 3,880 riels (2000)
(2) Laos Laos embarked on economic reforms called “The New Economic Mechanism” in 1986 to correct the deadlock in the planned economy since 1975, and is in the process of introducing the market economy and promoting open economic policies through various measures, such as reform of banking and the tax system, the
1 Ministry of Foreign Affairs (Japan) Official Web Page
4 passage of a foreign investment law, and the privatization of the state-owned enterprises. Laos faced severe inflation and a decline in the kip due to disruptions in the domestic macro economy at the time of the Asian Economic Crisis. At present, however, the economy is on a slow and steady recovery course. The Seventh Party Convention in March 2001 announced the country’s long- term goals of targeting a 7% average annual growth by 2005, emergence from the LLDC status and a three-fold improvement in national living standards by 2020.
(a) Main industries: Agriculture, forestry, hydropower generation (b) GDP: 1,220 million dollars (1999) (c) GDP per capita: 283 dollars (1999) (d) GDP growth rate: 5.2% (1999) (e) Price rise rate: 134% (Vientiane, 1999) (f) Unemployment rate: Unknown (g) (i) Total value of trade (1999), (ii) main trade items, (iii) main trading partners (Exports) (i) 310.9 million dollars (ii) Electricity, timber, tailored garments, coffee (iii) Thailand, Vietnam, Japan (Imports) (i) 524.6 million dollars (ii) Fuel, daily necessities, textile fiber materials (iii) Thailand, Vietnam, Japan (h) Currency: Kip, $1 = 8,200 kips (2001)
(3) Thailand Thailand achieved rapid economic development on the basis of foreign investment from such countries as Japan, from the late 1980s. However, such excessive investment led a deficit in the current amount and a bubble economy centering on the real estate sector. After that, the bursting of the bubble economy caused a large amount of bad debt, and the government of Thailand came under pressure to devaluate the Baht due to economic deterioration. When the government, finally, changed the exchange rate system to the floating system in July 1997, the economic crisis came, following a big fall in the value of the Baht. The government made efforts to rebuild the economy by the series of structural reforms including the disposition of bad debts with the assistance of IMF, Japan, and the international community. As a result of the fiscal policies of the Thai government and the good trends in exports, the sluggish economy
5 bottomed out in 1999 and is now on a recovery course. The Thaksin Administration formed in February 2001, has forwarded economic policies focusing on the basic sectors such as agriculture and small and medium enterprises, and demand-stimulating effects on the economy. However, there are also some fears of economic deceleration under the influence of the slowdown in the US economy.
(a) Main industries: The non-agricultural sectors accounted for approximately 90% of the GNP in 1996. The industrial sector held a 28.6% share of this. On the other hand, agriculture is an important industry despite the decrease in the share of agriculture in the economy because the agricultural working population amounts to approximately 50% in Thailand. (b) GDP: 125,000 million dollars (1999) (c) GDP per capita: 2,045 dollars (1999) (d) Economic growth rate: 4.2% (1999) (e) Price rise rate: 0.3% (1999) (f) Unemployment rate: 5.2% (1999) (g) (i) Total value of trade (1999), (ii) main trade items (1998), (iii) main trading partners (1999) (Exports) (i) 58,400 million dollars (ii) Computers, computer parts, apparel, IC, rice, transport equipment (iii) USA, Japan, Singapore, Hong Kong, the Netherlands, Malaysia (Imports) (i) 49,900 million dollars (ii) Machines, machinery parts, electronic equipment, electronic parts, chemical products, integrated circuit boards (iii) Japan, USA, Singapore, Malaysia, China, Taiwan (h) Currency: Baht, $1 = 45.45 bahts (2001)
(4) Vietnam Vietnam’s economy has developed under the Doi Moi Policy since around 1989, and the country maintained a high economic growth of 9% in 1995 and 1996. However, an economic growth slowdown occurred starting in 1997, foreign direct investments decreased rapidly due to the Asian Economic Crisis, and the competition in the export field among neighboring countries became heated. Consequently, the economic growth rate declined to 4.8% in 1999. The economy of Vietnam began an upward course in 2000, reaching a 6.7% growth rate, and is considered to be in the recovery process. Nevertheless, there
6 are some anxieties such as chronic trade deficits, a decline in international prices for main agricultural products, and immature investment conditions.
(a) Main industries: Agriculture, forestry, fisheries, mining (b) GDP: 26,400 million dollars (1998) (c) GNP per capita: 372 dollars (1999) (d) Economic growth rate: 6.7% (2000) (e) Price rise rate: -0.6% (2000) (f) Unemployment rate: 7.4% (1999) (g) (i) Total value of trade (2000), (ii) main trade items (2000), (iii) main trading partners (1999) (Exports) (i) 14,300 million dollars (ii) Crude oil, textiles, footwear (iii) Japan, Singapore, China, Australia (Imports) (i) 15,200 million dollars (ii) Machines, petroleum products, apparel materials (iii) Singapore, Taiwan, Japan, Republic of Korea (h) Currency: Dong, $1 = 14,071 dongs (2000) (i) Foreign investment: 37,400 million dollars (2000)
2.1.3 Potential Energy Resources
(1) Cambodia2 (a) Hydropower Cambodia has many national rivers such as the Bassac River and the Sap River, an international river of the Mekong, flowing from the north to the south, and Lake Tonle Sap, which functions as a sort of a water quantity adjuster between the rainy and dry seasons, in the northwestern part of the country. Therefore, Cambodia is a country rich in water resources. With respect to Lake Tonle Sap, the role of the lake as an adjuster is extremely important for Cambodia as an agricultural country to get water constantly throughout a year, because 85% of an annual rainfall is in the rainy season. The hydropower potential in Cambodia has not been assessed accurately yet. According to the study named “Subregional Energy Sector Study for the Greater Mekong Subregion” published by Asian Development Bank (ADB) in 1995, Cambodia’s exploitable hydropower potential was estimated at 8.6 giga-watt (GW),
2 NEDO (1999).
7 and the Ministry of Industry, Mines and Energy (MIME) of Cambodia estimates the potential at around 10 GW.
(b) Petroleum and Natural Gas The East West Center, whose headquarters is in Hawaii, made a trial calculation of the deposits of petroleum and natural gas on the basis of the geological data from a location offshore of Cambodia, and concluded that the deposits are 50 to 100 million barrels and 1.5 to 3.5 trillion cubic feet (TCF) respectively.
(c) Forest Resources Cambodia consists of lowlands and plains like the Mekong Delta and the Tonle Sap Basin, which make up 40% of the land, and hills, highlands and mountains along its borders with Vietnam, Laos, and Thailand. These uplands are densely covered with forest with tropical broad-leafed and deciduous woods. Such forests, fortunately, have not been developed actively due to the civil wars or border incidents, and remain in their natural condition, and are now precious primeval forests in Asia. Cambodia thus is abundant in forest resources, and the people have used them as firewood and for charcoal throughout history. Even to this day, many families depend on such non-commercial energy for essential energy, and the consumption of the non-commercial energy is far bigger than that of commercial energy. In recent years, however, the destruction of the forests due to the deforestation for timber exports as well as slash-and-burn agriculture in mountainous areas has created a significant issue. During the period of warfare particularly, the indiscriminate deforestation was carried out legally or illegally all over the country to earn foreign currency from timber export. Consequently, the wooded area is reported to have decreased by more than 20% between the 1960s and the 1980s. The forest area at the end of 1996 was 62% of the national land mass.
(2) Laos3 (a) Hydropower Laos is well endowed with hydropower resources and has approximately 26.5 GW potential excluding the trunk of the Mekong River. Though 18 GW of this potential is considered to be exploitable technically, the hydropower potential developed in the past 30 years is less than 2%. In order to promote the utilization
3 JEPIC (1998).
8 of these abundant hydroelectric resources, Laos has introduced foreign capital and made 23 MOUs (Memorandum of Understanding) on hydropower development.
(b) Petroleum The petroleum reserves in Laos are unknown at present, but the search for petroleum with foreign capital is underway in three mining areas. Full-scale exploration activities are now difficult because of a large number of unexploded bombs and mines from the Vietnam War.
(c) Coal Coal deposits have been confirmed in the Phonsaly, Xaignaboury, Vientiane, Xiengkhuang, Khammuane and Saravane provinces. Laos is a wooded country, and there is a high probability of coal deposits. Though only about 1,000 tons4 of anthracite a year is produced in the Bo Chan district in Vientiane Province, Laos and Thailand have planned joint projects to develop coal in Laos, build a power plant, and send electricity to Thailand. When the projects are carried out in the future, the production of coal will increase dramatically in Laos.
(d) Wood Fuel Laos is a country rich in forest resources because almost half of the land is covered with woods. However, at present a license is needed to cut down a tree and provincial offices regulate the forests, illegal cutting and timber smuggling against the background of a marked decrease in forest resources due to timber exports and illegal deforestation. Non-commercial energy like firewood accounts for roughly 90% of the country’s total energy consumption and the production of firewood is increasing with an annual increase rate of 3% between 1991 and 1994.
(3) Thailand5 (a) Hydropower Thailand’s hydropower potential is estimated at around 15 GW. However, approximately 26% of that had only been developed up to April 2000. The remaining 11GW potential is considered to be difficult to develop because of the impact on the environment. Hence hydropower development in the future will be restricted to small-scale and small impact projects.
(b) Petroleum
4 As of 1994 5 EGAT (2000b).
9 The petroleum deposits of Thailand are estimated to be around 910 million barrels. Almost all of petroleum used domestically is imported.
(c) Gas Natural gas reserves, which are located mainly in the Gulf of Thailand, are around 33.3 TCF. 4.0 TCF of this has been used for power generation.
(d) Coal Lignite is distributed throughout the country, and the estimated deposits are approximately 2,400 million tons. The Electricity Generating Authority of Thailand (EGAT) has developed 2.6 GW of coal-fired thermal power plants. If the entire amount of domestic lignite was used, it would be possible to generate about 5.9 GW of electricity. However, there are no developments plans for new coal- fired thermal power plants by EGAT due to environmental restrictions and public opposition.
(4) Vietnam6 (a) Hydropower According to the ADB study, Vietnam’s total hydropower potential is estimated at 300 billion kWh/year or more. The potential by region is 181 billion kWh/year for the northern, 89 billion kWh/year for the central and 30 billion kWh/year for the southern parts of the country. The estimated amount of the exploitable potential is about 82 billion kWh/year7. The power plants that have been developed so far amount to 2,850MW, including the Hoa Bihn Power Plant (240MW x 8 Units) that was put into full-scale operation in 1994. Vietnam has a policy to develop hydropower actively in the future.
(b) Petroleum Petroleum reserves amounted to approximately 600 million barrels as of January 1996, and the daily production of petroleum was about 160,000 barrels. As there are no domestic refineries in operation, Vietnam is currently dependent on high-price imports of petroleum for all petroleum products consumed in the country. In view of the country’s recent economic situation, Vietnam has explored the direct use of the domestic crude oil as fuel for the heavy-oil-fired thermal power plants in the south.
(c) Natural Gas
6 JEPIC (1999) 7 In the case of 15.6 GW of plant capacity and 60% of utilization factor.
10 A total 144 billion m3 of natural gas reserves are estimated in Vietnam. The details of the distribution are that the Lan Tay Gas Field has 42 billion m3, the Lan Do Gas Field has 14 billion m3, the solution gas reserves at the Bach Ho Oil Field are 28 billion m3, and the total solution gas reserves at the Dai Hung and Rong Oil Fields are 60 billion m3.
(d) Coal Coal reserves are estimated at approximately 3.5 billion tons. The share of anthracite and semi-anthracite, bituminous coal, and lignite are 92.4%, 0.3%, and 7.3% respectively. On an area basis, the Cam Pha area accounts for a 38.5% share, the Hon Gay area 13.7% and the Uong Bi area 37.7%. These three areas account for 89.9% of Vietnam’s total coal deposits.
2.2 Present Situation and Future Plans of the Power Sectors
2.2.1 Cambodia
(1) Structure of the Electricity Industry The Electricité du Cambodge (EdC) takes charge of power supply throughout the country. The EdC had been under the direct jurisdiction of the MIME until 1996, and at present comes under the jurisdiction of the MIME and the Ministry of Economy and Finance. Present power supply areas under the direct jurisdiction of EdC are six provinces, namely the Phnom Penh, Siem Reap, Sihanoukville, Pong Cham, Takeo, and Battambang. In the rest of the country, electricity is supplied by the Electricité du Province (EdP) under direct MIME’ jurisdiction, and by private companies which have contracted with the MIME. The EdPs are to be integrated into the EdC in the near future. The Electricity Law was promulgated on February 2, 2001, and the Electricity Authority of Cambodia (EAC) was newly established as a regulator for the entire power sector. On the basis of the MIME’s policy, the EAC performs regulatory functions such as the approval of electricity tariff, electricity business licensing, and the development of investment circumstances, which the MINE had executed, and also gives instructions and advice on a power purchase agreement (PPA) from the viewpoint of energy security. On the other hand, the MIME is responsible for power sector policy, planning, development, and technical standards. The EdC became a state-owned enterprise responsible for only electricity service. In this way, the roles of MIME, EAC and EdC have been clearly defined under the Electricity Law.
(2) Power Demand Forecast
11 At present, the Phnom Penh system accounts for 60%8 of the domestic power demand in Cambodia. The domestic peak demand in Cambodia from 1997 to 2000 increased rapidly at an annual average of 11%, and the maximum peak demand of the Phnom Penh system was 71.1 MW. As reference, the daily load curve of the maximum peak demand day (April 30) of the Phnom Penh system in 2000 is shown in Figure 2-1. According to the figure, the daily peak occurs for lighting in the evening. The annual energy calculated by the daily and hourly demand data of the Phnom Penh system is 396 MW, and the virtual annual load factor results in 62%. There are many potential users9 that do not intend to connect the EdC’s power system because of poor system reliability, the expensive electricity rate10 and so on. If various situations in power supply are improved in the near future, the potential users may connect to the EdC’s system. In this case, the World Bank’s study Power Transmission Master Plan & Rural Electrification Strategy11 forecasts that the total demand in Cambodia would grow at an annual average of 12% (Figure 2-2).
80 70 60 50 40 30 Load (MW) 20 Energy : 396 GWh 10 Load Factor: 62.0％ 0 0 6 12 18 Hour Source: EdC data
Figure 2-1 Daily Load Curve of the Phnom Penh system in Cambodia
8 MIME (1999). 9 According to the EdC’s survey, the potential users in Phnom Penh are put at approximately 25 to 30 MW in 1999. 10The average electricity rate of the EdC is about ¢16/kWh. The rate is higher than the cost of self-generation, that is about ¢12/kWh. 11 This research project was entrusted to the HECEC of an Australian consultant.
12 800 3,000 700 2,500 600 2,000 500 400 1,500
300 (GWh) 1,000 Demand (MW)
Maximum Power 200 Electric Energy 500 100 0 0 2001 2006 2011 2016 Year Maximum Power Demand Electric Energy Source: WB (1998).
Figure 2-2 Demand Forecast in Cambodia (the WB’s Study)
(The issue of the forecast methods and the demand forecast for this study)
According to the WB's Feasibility Study on First Southern Transmission Study, the demand forecast methods are as follows. The methods are divided into short-term and long-term forecasts. The short-term forecast means the trend analysis, and the long-term forecast means the economic model analysis on the basis of the result of the short-term analysis. The short-term analysis estimates only energy demand (GWh) because the trend of energy demand is stable and an accurate estimation is possible, and then calculates maximum power demand by a load factor. The forecasting process is as follows:
(a) Trend analysis, (b) Econometric modeling (population, income, electrification rate, etc.), (c) Market survey (clothing industry, beverage and tobacco industry, hotel industry, irrigation, etc.), and (d) Sensitivity analysis.
The long-term forecast prepares some growth scenarios whose parameters include oil prices, population, and income. These scenarios are as follows:
(a) Base scenario: GDP growth rate of 5%, crude oil price of $22/barrel (b) High-growth scenario: GDP growth rate of 6%, crude oil price of $16/barrel (c) Low-growth scenario: GDP growth rate of 4%, crude oil price of $27/barrel
13 There are 23 independent power systems besides the Phnom Penh system in Cambodia, and the demand forecasts of these systems are also made for each province. More than 600 private companies with small-scale generating facilities carry out power supply in local areas without access to the grid of the EdC. Most of the households in such areas use a battery for electricity supply. These users consume less than 1 kWh per month, and need to charge a battery three or four times a month. One battery charge costs about $1, and the monthly expense results in about $4 a month. This is far higher than the monthly tariff per kWh of the EdC, and if these users receive electricity from the distribution grid of the EdC, the monthly electricity consumption may increase. Hence, in order to make a detailed demand forecast in the future, it would be necessary to grasp the growth of potential demand brought by expansion of the national grid, and to incorporate this growth into the future demand forecast first. Next, it would be also essential to develop a system for continuously collecting and analyzing various data correlated with power demand such as GDP, the demand of various industries, the ownership rate of electrical appliances, etc. The data on power demand used in this study is based on estimated demand by the countries and is discussed from the viewpoint of its pattern. It is mentioned above that Cambodia has 24 independent systems at present, however, according to the Cambodia’s PDP12, the Phnom Penh system and the Sihanoukville system will be linked when the Sihanoukville thermal power plant is completed in 2006. The transmission line from the Vietnam system will connect to this line. Thereafter, the plan will develop a system for importing electricity from neighboring countries and for interconnecting the east and the west by about 2010. Based on this plan, the study used the energy demand forecast of the Phnom Penh system for the period up to 2006, the combined energy forecast of the Phnom Penh and Sihanoukville system for the period from 2007 to 2009, and the integrated forecast of all the systems for the period after 2010. The load factor of 40% used in the PDP is lower than that in neighboring countries, and is far from the virtual load factor of 62% shown above. In consideration of the state of load factors in neighboring countries, it is believed that electricity use in Cambodia in about 2015 will follow the similar course13 of Cambodia’s neighboring countries. Therefore, the study used the maximum power demand calculated on the assumption that the load factor would be maintained at the present value of 64% (Figure 2-3 and 2-4).
12 MINE (1999) 13 Tsuneaki Yoshida (2000).
14 (Maximum power demand forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 4.8 and 6.9 times those for 2000, and the annual average growth rate from 2000 to 2020 is 11.7%.
(Electric energy forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 4.8 and 6.9 times those for 2000, and the annual average growth rate from 2000 to 2020 is 11.7%.
700 3500 600 3000 500 2500 400 2000 300 1500 200 1000 100 500 Electric Energy (GWh)
Maximum Power Demand (MW) 0 0 2000 2005 2010 2015 2020 2000 2005 2010 2015 2020 Year Year
Figure 2-3 Maximum Power Demand Figure 2-4 Electric Energy Forecast Forecast (Cambodia) (Cambodia)
(3) Generating Facility (a) Present Situation The total EdC’s and IPP’s power generating capacity is 129MW14, and their generating facilities are light-oil or heavy-oil fired diesel generators. Table 2-2 shows the main generating facilities. In addition to them, mainly factories and hotels have self-generating units due to poor system reliability and the expensive power tariff of the EdC in the metropolitan area.
14 EdC (2000).
15 Table 2-2 Main Power Plants in Cambodia Power Plant Installed Capacity Operator Phnom Penh IIP1 35.0 IPP IPP 15.0 IPP C2 18.0 EdC C3 15.4 EdC C5 10.0 EdC C6 18.6 EdC Siem Reap 4.0 EdC Kampong Cham 2.0 IPP Takeo 0.9 EdC Sihanoukville 10.0 EdC Total 128.9 Source: EdC (2000).
(b) Development Policy The long-term power development policy gives priority to hydropower, however there are no specific target figures for the combination of generating sources at present. Since hydropower development requires a lot of time and investment, power purchase from Thailand and Vietnam is planned for the future short-term and medium-term. The fuel policy for thermal power plants up to 2020 will reduce the use of diesel oil, and utilize offshore gas near the border with Thailand or imported gas from neighboring countries through pipelines. The research on a coal-fired thermal power project is also underway in the north, however the PDP takes account of no coal-fired power generation with its preference for hydropower and gas-fired power generation as primary energy sources.
(c) Development Plan The first comprehensive master plan for the Cambodian power sector is the aforementioned Power Transmission Master Plan and Rural Electrification Strategy by the WB in 1998, however the MIME and EdC recognize that this master plan has become no longer realistic due to the substantial change of the situation in the power sector of Cambodia caused by the Asian Economic Crisis and the civil war. Under the Cambodia Power Sector Strategy 1999-2016 drawn up by the MIME in January 1999, Cambodia plans to construct nine power plants, with a total of 753 MW, by 2016 (Table 2-3). The MIME’s power sector strategy is supposed to be updated every two or three years, however a slight delay has now occurred. IPP projects overall have been postponed by the delay of natural gas development in the Gulf of Thailand because of slackening in gas demand in Thailand and the difficulty in financing by developers. With respect to hydropower development, the priority in the near
16 future is lower in comparison with thermal power generation or power purchasing from other countries because of the large initial investment and long lead-time. The progress of hydropower development has been made only to extent of a feasibility study (F/S) owing to the environmental issues.
Table 2-3 Power Plant Development Plan in Cambodia Maximum Operation Project Type Output Status Year (MW) Phnom Penh IPP-2 CCGT 60 By 2008 Low Possibility BOT15 contract has Kirirom Hydro 12 2002 signed with CITEC of China Sihanoukville IPP-3 SCGT 90 2006 F/S Completion Sihanoukville IPP-4 CCGT 90 2008 F/S Completion Kamchay Hydro 128 2008 F/S Completion Battambang 1&2 Hydro 60 2011 Unknown Stung Atay Hydro 100 2012 Unknown Sihanoukville IPP-5 SCGT 90 2014 Unknown Middle Stung Hydro 125 2016 Unknown Russei Chrum EdC Project Total 425 IPP Project Total 330 Source: EdC (2000).
(4) Transmission and Substation Facilities (a) Present Situation There is no integrated national power network in Cambodia at present, and power supply is conducted through an independent distribution grid of each city. With respect to distribution, the metropolitan area has three types of medium-voltage lines, namely 15 kV, 6.3 kV, and 4.4 kV, and one low-voltage line of 380/220 V. The 15 kV line accounts for roughly 90% of the total line length. The EdC and donors have rehabilitated distribution networks16 in the country, and the type of voltage, not only in the metropolitan area but also in other major cities, to consist of 22 kV and 380/220 V in the future. The system loss rate of the EdC is shown in Figure 2-5. The rate was successfully reduced from 35% to 15% in the period from 1991 until 2000.
15 Build-Operate-Transfer. 16 For the Phnom Penh system, for example, “The Project for Rehabilitation and Upgrading of Electricity Supply Facilities in Phnom Penh - Phase 2” by the JICA, “Phnom Penh Power Rehabilitation Project” by the WB, etc.
17 40.0 35.0 30.0 25.0 20.0
Loss (%) 15.0 10.0 5.0 0.0 1991 1993 1995 1997 1999 Year Source: EdC (2000).
Figure 2-5 Transition of the EdC’s System Loss
(b) Development Plan Transmission development projects are divided into ones concerning the construction of new power plants and power exchanges with neighboring countries. The transmission line projects to the Phnom Penh system from IPPs’ thermal power plants around the metropolitan area and to Battambang or Pursat from hydropower plants in the west are included in the former category17. The former plan will build also four substations located in the north, south, east, and west of Phnom Penh. The plans associated with the power exchange are the development of the 115 kV transmission line between Thailand, Banteay Meachey and Battambang in 2002, and the 220 kV18 transmission line between Vietnam, Takeo and Phnom Penh in 2004.
(5) International Power Interconnection19 (a) Policy The current electricity tariff of the EdC is extremely higher at ¢15.5/kWh than neighboring countries, and this high tariff is a barrier to the development of domestic industries. The MINE has an awareness that the most important thing at present in the Cambodian power sector is to supply low cost electricity, and in consideration of the fact that Cambodia’s electricity business market is small, for example 43% of the consumers use less than 50kWh electricity a month, power import from Thailand and Vietnam is more expedient than domestic power
17 The Phnom Penh and Prusat system are to be connected by around 2016. 18 The voltage of 220 kV is the Vietnamese standard. The standard of Thailand is 230 kV. 19 Based on interviews with the MIME and the EdC.
18 development in order to satisfy power demand in the short term, and an international power interconnection project is one of effective measures to supply electricity at an inexpensive price. Cambodia plans to import roughly 40%20 of all its needed electricity from Thailand and Vietnam in the next five years, but such high imports are quite risky from the viewpoint of national energy security. When an institutional framework21 that prohibits a supplier from cutting off electricity arbitrarily is established, the concerns on energy security would be reduced in some part.
(b) Present Situation Cambodia receives electricity from the Provincial Electricity Authority (PEA) of Thailand at seven locations along the border with Thailand. The transmission voltage is 22 kV and the capacity is small at only 1 to 5.6 MW.
(c) Future Plan Cambodia signed the PPA with Vietnam on June 24, 2000, to receive a maximum 80 MW electric power until 2005 and maximum 200 MW after 2005. There is no agreement on minimum capacity. The details of the transmission line for the Cambodia and Vietnam power interconnection is as follows.
(i) The overall length of the 220 kV transmission line is 120 km on the Cambodian and 130 km on the Vietnamese side. (ii) The transmission line is 200 MW, 410 mm2 ´ 2, and 2 circuits between the border and Takeo.
Cambodia has signed a PPA also with Thailand to receive electricity for three provinces in northwestern Cambodia, that is Banleay Meachew, Siem Reap, and Battambang provinces. The voltage of the line is 115 kV for transmission among the provincial capitals and 22kV for distribution. The capacity is around 20 to 30 MW. This project is to be conducted by the Electricity Generation Public Company Limited (EGCO) as a BOT project, and the EdC will give the license to the EGCO in order to own the transmission line because foreign countries are not entitled to hold a transmission line under Cambodian law.
(6) Facility Operation The C5 and C6 power plants take charge of frequency control. The control standard is the rated frequency ± 0.5%. When the frequency falls below the
20 The MINE regards 15% as an appropriate level for the share of imported electricity in the future. 21 The ADB’s Greater Mekong Subregion members have discussed the framework of power
19 standard, the substation will cut off some load of 22 kV and 15 kV feeders. Though there is no control value for high-voltage, the control standard for low- voltage is the rated voltage ± 10%. The output adjustment range of the power plants is 50 to 100% of the rated output. When a power plant receives a starting order from the load dispatching center half an hour before the starting time, the power plant runs a start check on the fuel and water systems. After the generator has started, it takes about 15 minutes for system synchronizing, and 30 to 60 minutes in order to reach the maximum output.
(7) Electrification Rate The electrification rate of Cambodia is less than 20%, and that rate is the lowest among the four countries in Indochina. Since nearly 90% of the population live in rural areas, it would be necessary to increase access to electricity for people in these areas so as to achieve an overall improvement in the electrification rate22.
2.2.2 Laos
(1) Structure of the Electric Industry The Electricité du Laos (EdL) is under the direct jurisdiction of the Ministry of Industry and Handicrafts (MIH), and is responsible for all aspects of domestic power supply from power generation to transmission and distribution. In the main provincial capitals, the MIH developes dispersed type diesel power generation and small hydropower plants, and the provincial offices operate them and supply electricity to the public. The BOT projects for power export to foreign countries and key subjects on electric power policies are decided by the Committee for Energy and Electric Power of the Lao National Committee for Energy consisting of the MIH, the Ministry of Finance, the National Planning Committee, the EdL and others.
(2) Power Demand Forecast In the four-years period 1997-2000, the domestic demand for electric energy in Laos grew at a high rate averaging 14% per year. The electrification rate in Laos has been improving steadily due to the efforts and assistance of the Lao government and donors. In consideration of on-going projects in the Central-2
interconnection and trade. 22 At present the ADB’s Provincial Power Supply projects are implemented in the eight areas, namely the Banlung, Kampong Spue, Kampot, Prey Veng, Serey Sophon, Stung Trey, Svey Rieng, and Takeo province.
20 and Southern area23, an average growth rate of more than 10% is projected over the next ten years. It is assumed that the maximum power demand in 2020 will be about 800 MW24 (Figure 2-6).
900 4,000 800 3,500 700 3,000 600 2,500 500 2,000 400 1,500 (GWh) 300 Demand (MW) Electric Energy Maximum Power 200 1,000 100 500 0 0 1992 1997 2002 2007 2012 2017 Year Maximum Power Demand Electric Energy Source: EdL (2001).
Figure 2-6 Transitions of Maximum Power Demand and Electric Energy in Laos
The peak demand occurs during the hot period in April of the dry season due mainly to the use of air conditioners and lighting. No load shedding, presently, is implemented at peak time. Figure 2-7 shows the daily load curve of the maximum load day (April 3) in the Vientiane system in 2000. According to the EdL, the assumed values for the annual load factor in 2005, 2010, 2015, and 2020 are 44.7%, 48.3%, 51.4%, and 53.1% respectively. However the actual annual load factor in 2000 was calculated by this study to be 57.2% from the daily and hourly data of the Vientiane system in 2000. When this real annual load factor in 2000 and the assumed load factors of EdL in the future are compared, the future load factors seem to be too low. Therefore it is necessary to review them.
23 The transmission system in Laos has 16 independent systems including the small ones and is divided roughly into four major transmission systems. 24 EdL (2000).
21 110 100 90 80 70 60 50 40 Load (MW) 30 Energy : 490 GWh 20 10 Load Factor: 57.2％ 0 0 6 12 18 Hour Source: EdL data
Figure 2-7 Daily Load Curve of the Vientiane system in Laos
(The issue of the forecast methods and the demand forecast for this study)
The methods for demand forecast are to extrapolate from the average data over the past three years. The forecast with the GDP value of each province has not been implemented because accurate GDP data is unavailable25. In order to make a detailed forecast for the future, it would be necessary to build the circumstances able to grasp accurately the demand to be added with the result of domestic power system expansion and continuously collect various numerical data correlated with the power demand forecast such as GDP, demand of various industries, the ownership rate of electrical appliances, etc. The study used the electric energy forecast released officially and the
25 The ADB’s Power Sector Strategy Study makes the demand forecast with the original forecast methods as follows. The ADB’s study divides the regions into four areas, namely the Northen, Central-1, Central-2, and Southern area, and the demand types into household and non- household use on account of the fact that nearly half of the demand in Laos is household use. Base and high-growth scenarios are prepared for a demand forecast up to 2020. The demand of household use is calculated as the product of household numbers and average annual electricity consumption. The annual growth rate of household demand is set to 6% per year, and a new electrified household is assumed to consume 40 kWh in the first year. In respect to the number of households, the ADB’s report forecasts that the present 256,000 households and additional 190,000 newly electrified households up to 2020 will need 2,100 GWh in the base case, and the demand of the 446,000 households above plus 280,000 households in rural areas ends up 2,280 GWh in the high case. For the purpose of computing the power requirement at the sending end, the transmission and distribution loss is assumed as follows. The present loss including non- technical loss is 26%, however the loss rate has decreased in the past five years and is expected to show the same trend over the next ten years. Hence the assumed loss rate in 2000 and after 2005 is 25% and 20% respectively in the study of the ADB. The load factor is decided in consideration of the past record of the overall load factor and the growth rate in main loads due to the absence of the data on load factors by demand type. The household load factor is set to be lower than others’.
22 maximum power demand calculated by the fine-tuned load factor, and supposed that the Vientiane system would gradually expand and interconnect with the other 15 independent systems. The demand and energy forecast used in this study are shown in Figures 2-8 and 2-9.
(Maximum power demand forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 3.7 and 5.6 times those for 2000, and the average growth rate from 2000 to 2020 is 10.6%.
(Electric energy forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 3.7 and 5.6 times those for 2000, and the average growth rate from 2000 to 2020 is 10.6%.
800 4000 700 3500 600 3000 500 2500 400 2000 300 1500 200 1000 100 500 Electric Energy (GWh) 0 0 Maximum Power Demand (MW) 2000 2005 2010 2015 2020 2000 2005 2010 2015 2020 Year Year
Figure 2-8 Maximum Power Demand Figure 2-9 Electric Energy Forecast Forecast (Laos) (Laos)
(3) Generating Facility (a) Present Situation The total generating capacity is 640.7 MW in Laos. This total consists of 39 hydropower plants accounting for 628.0MW and 14 diesel power plants making up 12.7MW. Table 2-4 gives an overview of the hydropower plants in Laos. The IPP power plants operated on BOT export 99% of their generated energy to Thailand26.
26 The revenues of the Lao government from the IPP power projects in Laos are royalties on water, taxes, stock dividends concerning the projects, and so on. The ratio of stock holding of the government is 20 to 60%. The ratio of the Nam Theun 2 hydropower project is planned at 25%.
23 (b) Development Plan Hydropower takes first priority in the power plant development. Lao plans to construct 20 new power plants up to 2015. The EdL has six projects, and the other 14 projects are IPP’s. With respect to the Nam Theun 2 hydropower projects operated by the IPP, since its success would influence the future large hydropower projects not only in Laos but also in the Indochina region, the projects are in the spotlight27. Figure 2-10 and 2-11 show the transition of generating capacity and the domestic sold electric energy respectively in Loas.
Table 2-4 Main Hydropower Plants in Laos Power Plant Installed Capacity (MW) Operator From Theun Hinboun 210.0 IPP (BOT) 1998 Nam Ngum 128 150.0 EdL 1971 Houay Ho 152.1 IPP (BOT) 1999 Nam Leuk 60.0 EdL 2000 Xeset 1 45.0 EdL 1991 Selabam 5.0 EdL 1969 Nam Phao 1.6 Province 1995 Nam Ko 1.5 Province 1997 Nam Dong 1.0 EdL 1970 30 Micro Power Plants 1.8 Province Total 628.0 Source: JEPIC (2000).
27 The WB has demanded of the Lao government the stability of a macro economy, the reinforcement of governance, public involvement, and so on as the conditionality of financing the project, and also supplied a lot of technical assistance to solve these issues. The International Monetary Fund (IMF) approved the Poverty Reduction and Growth Facility, four million dollars for three years, for the government of Laos in April 2001. This means that Lao’s macro economy is considered to be sound, and the project may move close to its realization. 28 The Nam Ngum1, hydropower plant was built with assistance of 12 countries including Japan, and put into operation in 1971. The plant uses a lot of Japanese technology and equipment.
24 9,000.0 8,000.0 7,000.0 6,000.0 5,000.0 4,000.0 3,000.0 2,000.0
Generating Capacity (MW) 1,000.0 0.0 1995 2000 2005 2010 2015 2020 Year Hydropower (IPP) Hydropower (EdL) Coal (EdL) Source: EdL data Figure 2-10 Transition of Generating Capacity in Laos
2,500
2,000
1,500
(GWh) 1,000
500 Domestic Energy Sales 0 1995 2000 2005 2010 Year Household Use Non-household Use Source: ADB (2001b)
Figure 2-11 Transition of Domestic Sold Electric Energy in Laos
(c) Demand and Supply Balance The present situation in terms of the power demand and supply balance in Laos shows that the generating capacity is adequate for the domestic demand, which accounts for only 25% or so of the total generating capacity in Laos. However, since the power system is not interconnected nationwide, the excess power of the Central-1 and Southern area is exported to Thailand29, and the
29 The total volume of both excess power and electricity from the Theun Hinboun and Houay Ho hydropower plants, which are exclusively for exporting electricity to Thailand, makes up 40% or more of the total generating energy in Laos. The government of Laos regards the revenue from the power export as a pillar of its finance.
25 Central-2 and Northern area import electricity from Thailand and Vietnam30. The reserve margin for domestic demand in 2000 was 76%. However as for the demand and supply balance for the next 10 years, a power shortage may arise if the Nam Mang 3 power plant is unable to go into service in 2005, and this would necessitate power imports for domestic use from Thailand and/or Vietnam. In addition to this, the reserve margin from 2003 to 2005 may fall below the 25% mark, which is supposed to be the appropriate reserve margin in developing countries, and Laos would be forced into a severe management situation.
(4) Transmission and Substation Facilities (a) Present Situation As mentioned above, the transmission system in Laos is divided roughly into four individual systems and these systems are not interconnected. Most of the transmission lines in Laos are medium-voltage transmission lines operating at 22 kV. The energy generated at the Theun Hinboun and Houay Ho hydropower station are transmitted to Thailand via exclusive 230 kV transmission lines. Laos exchanges electricity with 115 kV transmission lines for EGAT, 22 kV lines for PEA of Thailand, and 35 kV transmission lines for EVN.
(b) Development Plan Since the lack of interconnection among domestic systems causes the comparatively higher electricity supply to the Central-2 area in time of power shortage, Laos recognizes that it is essential as a matter of great urgency to build a main artery transmission system which interconnects the independent systems and expands the distribution lines in order to boost the country’s electrification rate. In this connection, the Japan International Cooperation Agency is in the process of carrying out the Study on Master Plan of Transmission Line and Substation System to draw up a master plan for transmission and substation facilities in Laos up to 2020.
(5) International Power Interconnection31 (a) Present Situation At present, the Vientiane system is connected with the Thailand system via 3 circuits of 115 kV transmission lines, and the surplus energy in the Vientiane
30 After all, Laos imports from Thailand 50% or less of the exported surplus electricity. Consequently, Laos supplies electricity to the power shortage areas at relatively higher cost than Thailand’s transmission system due to the lack of interconnection among domestic systems in Laos. 31 Interview with the MIH and EdL.
26 system is exported to Thailand32 with these lines.
(b) Future Plan Laos has signed a memorandum of understanding (MOU) with Thailand for the export of 3,000 MW until 2006, with Vietnam for 1,500 to 2,000MW up to 2010, and also with Cambodia33.
(6) Facility Operation34 The control criterion of frequency is the rated frequency ±0.1%, and that of high-voltage is 115 kV ±5%. The Phone Tong substation has a capacitor-bank for the control of voltage. Re-synchronizing system order is made at the Phone Tong substation in case of system splitting from the Thailand system35. The Nam Ngum reservoir is operated so that the water level reaches its lowest level on January 1 every year. Though the Nam Ngum hydropower station is running at full capacity with all five generators in the rainy season, the reservoir is full in August and September, and the station has to discharge excess water from the spillway in spite of precious water resources to generate electricity and earnings. When it is expected that there will be a freshet due to a heavy storm, the reservoir drops its water level in advance after getting the Prime Minister’s Office permission. The IPP’s power plants are operated according to the monthly, weekly, and daily schedule to satisfy the energy generation for each PPA. The schedules are coordinated at the Khon Kaen load dispatching center of Thailand and the Phone Tong substation. For stopping the facilities, consultation with the Khon Kaen load dispatching center is needed two days in advance.
(7) Electrification Rate Laos had an electrification rate of 34% in 1999. The local government is required to shoulder 30% of the construction cost for electrification, and this
32 The payment to the EdL from the EGAT is on a dollar basis. However, the electricity tariff on the PPA is on a baht basis, and the exchange rate is decided as follows. Half of the payment is subject to the fixed rate, $1 = 28 bahts, and the remaining half to a floating exchange rate. The unit tariff is 1.22 bahts per kWh in the peak and 1.14 bahts per kWh in the off-peak hours. In the case of emergency supply from Thailand due to generator trouble in Laos, the unit tariff to Thailand becomes ¢0.5/kWh higher than the ordinary tariff. The Phone Tong substation measures the amount of power export to Thailand. The correction of the kWh meter for power exchange is made every two years. 33 The capacity and starting year are uncertain at present. 34 Interview with the EdC 35 The both systems have experienced the long system splitting only once for about one month during the conflict between Laos and Thailand in 1988. However, there were no serious operational problems at that time because the year had a little rainfall.
27 financial burden is considered to be the cause of delay in electrification. The government of Laos has set the target of achieving an electrification rate in excess of 90%36 by 2020, however this target would be extremely difficult to attain under present circumstances. In order to increase Laos’ domestic electrification rate, the ADB is supporting the Power Transmission and Distribution Project in the Central-1 area, and the WB is assisting in the Southern Provincial Rural Electrification Project in the Central-2 and Southern area. Fig. 2-12 shows the ADB’s forecast on electrification rate in Laos.
100.0 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0
Electrification Rate (%) 10.0 0.0 2000 2005 2010 Year Source: ADB (2001)
Figure 2-12 Household Electrification Rate in Laos
2.2.3 Thailand
(1) Structure of the Electric Industry The EGAT is responsible for most of the power generation and transmission in Thailand as a whole. In addition, there are some small power producers (SPPs) and IPPs, such as the EGCO, active in power generating business37. In distribution, the Metropolitan Electricity Authority (MEA) covers Bangkok and two surrounding provinces, and the Provincial Electricity Authority (PEA) covers the other areas in Thailand. In December 1992, there was an announcement on the power sector privatization plan saying that three state-owned utilities will be privatized entirely by 1996, little progress, however, was made in the 1990s. In March 2000, the National Energy Policy Office (NEPO) released the Thailand Power Pool and Electricity Supply Industry Reform Study - Phase I. The restructuring toward
36 Including the electrification with isolated systems using diesel, solar energy generation, etc. 37 The first IPP started operation in Thailand in 2000.
28 the introduction of a power pool in 2003 is now in progress.
(2) Demand Forecast The demand forecast is drawn up by the Thailand Load Forecast Subcommittee, which consists of representatives from the relevant bodies, namely the National Statistical Office, Federation of Thai Industries, EGAT, MEA, PEA and so on, with NEPO as a chairman. Although the domestic annual electricity consumption in Thailand went down in 1998 and 1999 because of the Asian Economic Crisis, the results of an annual 7% growth in 2000 show signs of recovering, and it is assumed that power consumption will continue to grow at about 7% a year (Figure 2-13). Figure 2-14 shows the daily load curve on the maximum peak demand day (April 5) of the Thailand system in 2000. The method for the long-term demand forecast makes a regression analysis on the growth rate of GDP, household electricity consumption, and other related parameters with an end user method in order to decide the electric energy. The maximum power demand is calculated using a load factor. The load curves by sector such as industrial use, household use, etc. as a basis of the load factor are studied by the MEA and PEA. The short-term demand forecast is made with software in consideration of demand data over the past three years, and correction in temperature. Usually, the peak demand occurs in the hottest month, that is April, and the peak changes at about 200 MW for every one-degree change in that season by a demand sensitive to temperature, such as air conditioner use.
45,000 300,000 40,000 250,000 35,000 30,000 200,000 25,000 150,000 20,000 (GWh) 15,000 100,000 Demand (MW) Electric Energy Maximum Power 10,000 50,000 5,000 0 0 1988 1993 1998 2003 2008 2013 Year Maximum Power Demand Electric Energy Source: EGAT data
Figure 2-13 Transition of Maximum Power Demand and Electric Energy in Thailand
29 16000 14000 12000 10000 8000 6000 Load (MW) 4000 Energy : 98,636 GWh 2000 Load Factor: 75.3％ 0 0 6 12 18 Hour Source: EGAT data
Figure 2-14 Daily Load Curve in Thailand
(The issue of the forecast methods and the demand forecast for this study)
There would be no particular problems in this forecast method. It would be necessary to grasp the extent of the error in demand forecast, to consider risk management against the uncertainty of demand, and, in particular, to pay attention to the fact that the response to demand due to temperature will become more critical with the increase in air conditioner use, and consequently the fluctuation of peak demand per degree in temperature will grow larger in the future. For Thailand, the submitted demand forecast up to 2016 was used in this study. Since demand forecast from 2017 to 2020 has not been made yet, the study assumed electric energy forecast from 2017 to 2020 using the trend of the preceding five years. On the other hand, maximum power demand from 2017 to 2020 was made using the assumed energy and the submitted load factor in 2016. The demand and energy forecast used in this study are shown in Figures 2-15 and 2-16.
(Maximum power demand forecast of Thailand in this study) The assumed values for 2010 and 2015 are 1.9 and 2.6 times those for 2000, and the average growth rate from 2000 to 2020 is 6.1%. The load factor is 73% for 2010 and 2015.
(Electric energy forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 1.9 and 2.5 times those for 2000, and the average growth rate from 2000 to 2020 is 6.0%.
30 60000 350000
50000 300000 250000 40000 200000 30000 150000 20000 100000 10000 Electric Energy (GWh) 50000
Maximum Power Demand (MW) 0 0 2000 2005 2010 2015 2020 2000 2005 2010 2015 2020 Year Year
Figure 2-15 Maximum Power Demand Figure 2-16 Electric Energy Forecast Forecast (Thailand) (Thailand)
(3) Generating Facility (a) Present Situation38 The current power generating capacity connected to the Thailand’s system is 22,269.0 MW. The EGAT-owned generating facilities make up 76.5% of Thailand’s system installed capacity. Table 2-5 gives an overview of the generating facilities in Thailand.
Table 2-5 Thailand’s System Installed Capacity EGAT’s Power Plants Installed Capacity (MW) Thermal 7,962.5 Combined Cycle 5,534.6 Hydro 2,880.0 Gas Turbine 656.0 Diesel 6.0 Renewable Energy 0.5 Subtotal 17,039.6 Purchase from EGCO REGCO: Rayong Electricity Generating Co., Ltd. 1,232.0 KEGCO: Khanom Electricity Generating Co., Ltd. 824.0 IPT: Independent Power（Thailand）Co., Ltd. 700.0 TECO: Tri Energy Co., Ltd. 700.0 SPPs: Small Power Producers 1,433.4 DEDP:Department of Energy Devfelopment and Promotion 0.0 Laos Theun-Hinboun 214.0 Houay Ho 126.0 Subtotal 5,229.4 Total 22,269.00 Source: EGAT (2000a)
38 EGAT (2000a).
31 (b) Development Policy39 The power development plan functions so that the system reliability level satisfies 24 hours per day in loss-of-load probability (LOLP) and 25% in reserve margin. There are no particular targets for the share in use of each fuel type. The natural gas share of 70%, however, is a characteristic of Thailand’s power sector. This is because Thailand is obliged to purchase a certain quantity of gas due to a take-or-pay contract. The rising petroleum price is also one of the reasons.
(c) Development Plan The EGAT Power Development Plan 99-02 revised in May 2000 has planned new power plants on the assumption of a slow economic recovery scenario. The reserve margin was 27% in 2000. It will reach 34% because of new power plants put into operation in 2001, even if Thailand’s economy grows at a rapid rate. The reserve margin of 34% is far from the appropriate value of the maximum 25%, and the PDP will be revised in order that the reserve margin ranges between 15 and 24%. The demand and supply balance is considered to be an oversupply up to 2011 under a slow economic recovery scenario, and new power plant development would be negative. Figure 2-17 shows the assumed transition of installed capacity.
45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 Installed Capacity (MW) 0 1986 1991 1996 2001 2006 2011 Year Hydro Thermal Combined Cycle Gas Turbine & Diesel Purchase etc. Source: EGAT (2000b).
Figure 2-17 Transition of Installed Capacity in Thailand
(4) Transmission and Substation Facilities
39 Interview with the NEPO and EGAT
32 The trunk transmission system consists of the 230 kV outer lines linking with the thermal power plants and the substations near Bangkok, the 500 kV transmission lines between the Memo thermal power plant in the northwest of Thailand and the metropolitan area, and the 230 kV transmission lines connecting the four big hydropower plants, namely the Bhumibol, Sirikhit, Srinakarin, and Khao Laem hydropower plants in the western Thailand, and the metropolitan region. Besides these trunk transmission lines, there are 110kV transmission lines among the hydropower plants scattered in the northeastern part of Thailand, and the 115 kV transmission lines connecting central Thailand with the southern part of Thailand, including the transmission lines to the Vientiane system and IPP’s power plants in Laos. As regard to the security of power supply, Thailand has adopted the N-1 principle. Figure 2-18 gives the total loss of generation, transmission, and distribution in Thailand. The loss line shows a decreasing trend.
20 18 16 14 12 10 8 Loss (%) 6 4 2 0 1987 1989 1991 1993 1995 1997 1999 Year Source: EGAT (2000b)
Table 2-18 Transition of the Total Loss of Generation, Transmission, and Distribution
(5) International Power Interconnection40 (a) Policy The EGAT plans how to operate interconnected transmission lines and the NEPO has responsibility to check whether a contract for power exchange41 fulfills the service-quality standards. The NEPO believes that the most important thing for power import from a foreign country is to minimize its impact on customers and its economical efficiency is the second priority.
40 Interview with the NEPO and EGAT. 41 The EGAT is responsible for contract with utilities in foreign countries as well as domestic power enterprises.
33 While there are no restrictions on the amount of electricity imported from foreign countries, the previous research reported that the rough amount is less than 13%, 26%, and 33% of the total of Thailand’s demand in the case of importing from one, two, and three countries respectively.
(b) Present Situation Thailand imports 340 MW from two IPP hydropower plants in Laos and the surplus electricity42 of the Vientiane system. On the other hand, Thailand exports electricity to the Central-2 area through the EGAT and the Bokeo, Xaignabouly, and Khammuane area from the PEA of Thailand. Thailand’s power system is interconnected with the Malaysia system with a 132/115kV transmission line for the purpose of power exchange in an emergency. This interconnection line permits the EGAT to receive a maximum 80 MW from the Tenaga National Berhard (TNB) of Malaysia and to send a maximum 50 MW to the TNB. In order to reinforce the power interconnection between Thailand and Malaysia, a high-voltage direct-current transmission line is currently under construction43. The completion of this project will enable an exchange 300 MW with each other.
(c) Future Plan The following MOUs regarding power import have been signed on an intergovernmental basis.
(i) Laos: 3,000MW up to 2008, such as the Nam Theun 2. (ii) Myanmar: 1,500MW up to 2010. (iii) Yunnan Province, China: 3,000MW up until 2017, such as the Jinghong.
With regard to the 500 kV transmission line project for power import from China to Thailand through Laos, the three countries have discussed how to implement the Loa’s portion.
(6) Facility Operation44 EGAT’s management standards for voltage control is normally the rated voltage +5%/-2% and ±8% in an emergency. The frequency is controlled to 50Hz ± 0.1 Hz. The hydropower plants are operated for peak time and also for frequency control.
42 There is no specific agreement concerning quantity of electricity. 43 The capacity is 300 MW and the length is 120 km. 44 Interview with the NEPO and EGAT.
34 The central load-dispatching office makes the power generation schedule for the following day taking into account the available capacity of the EGAT and IPP power plants. The basic priority in power plant operations is: (1) Prevention of environmental pollution; (2) Securing reserve capacity; (3) Stabilizing system frequency and voltage; and (4) Economical efficiency.
(7) Electrification Rate The electrification rate of villages at present has reached nearly 100%. Figure 2-19 shows the transition of the electrification rate in households.
100.0 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 Electrification Rate (%) 10.0 0.0 1987 1992 1997 Year Source: EGAT (2000b)
Figure 2-19 Transition of an Electrification Rate in Households
2.2.4 Vietnam
(1) Structure of the Electric Industry The Electricity of Vietnam (EVN) under the jurisdiction of the Ministry of Industry (MOI) is responsible for the whole power sector, conducts generation and transmission services through dependent accounting companies, and wholesales electricity to seven independent accounting distribution companies. The EVN also has the Institute of Energy (IE) as a research institute.
(2) Demand Forecast The domestic power demand showed a high growth rate of average 14% per year from 1997 to 2000 in Vietnam. The IE reported that an annual growth rate averaging 10% could be expected over the next 10 years even in the low-growth case (Figure 2-20). The maximum power demand hitherto is 5,500 MW, however load shedding is
35 implemented at peak hours. Figure 2-21 shows the daily load curve on the maximum peak demand day (November 28) of the Vietnam system in 2000. The transition of sold electric energy by industry up to 2020 is as shown in Figure 2-22. 30,000 180,000 160,000 25,000 140,000 20,000 120,000 100,000 15,000 80,000 (GWh) 10,000 60,000 Demand (MW) Electric Energy Maximum Power 40,000 5,000 20,000 0 0 1988 1993 1998 2003 2008 2013 2018 Year Maximum Power Demand Electric Energy Source: EVN (2001).
Figure 2-20 Transition of Maximum Power Demand and Electric Energy in Vietnam
6000
5000
4000
3000
Load (MW) 2000 Energy : 27,054 GWh 1000 Load Factor: 62.9％ 0 0 6 12 18 Hour Source: EVN data
Figure 2-21 Daily Load Curve in Vietnam
36 160,000 140,000 120,000 100,000 80,000 60,000 40,000 Energy Sales (GWh) 20,000 0 1995 2000 2005 2010 2015 2020 Year Industry Household Service Agriculture Source: EVN (2001).
Figure 2-22 Transition of Energy Sales in Vietnam
For The Master plan on Electric Power Development in Vietnam for the period of 2000-2010 perspective up to 2020 by the EVN, the demand forecast methods are as follows.
(a) Direct method The direct method, which is the way to forecast electric energy directly in consideration of the production plans of main industries that consume a great deal of electricity, is used for a three to five year short term forecast. The demand forecast between 2000 and 2005 was prepared by the direct method on account of actual information about large-scale projects, such as a bauxite development, steel production, and fertilizer manufacturing industry. Since demand forecast using this method is carried out for each province, the state of load distribution and industry types by province are identified and utilized for the planning of transmission and distribution lines. Customer types are divided into industrial, commercial, agricultural, and household use. Forecast areas are finally classified into the north, central, and south. With respect to the economic growth scenario, low, base, and high scenarios are prepared.
(b) Indirect method The indirect method, which is the way utilizing the scenario simulation method, is used for a medium and long term forecast from 2005 to 2020. Concretely, maximum power demand and electric energy are assumed with GDP elasticity based on an assumed medium and long term scenario. The elasticity is basically calculated for each industry and each region by the following formula, and fine-tuned with reference to the actual results of the GDP elasticity in
37 neighboring developing countries in the 1980s and 1990s.
Power DemandGrowth Rate(%) Elasticity = GDPGrowth Rate(%)
The influence of the electricity rate, especially subsidies, and energy saving brought about by technical advances and demand side management (DSM) on power demand is also reflected. The average value of the actual GDP elasticity from 1991 to 1999 is 1.89, and the expected elasticity is as follows:
1999-2000: 1.82 2001-2005: 1.62 2006-2010: 1.48 2011-2020: 1.39 Average : 1.50
With respect to load characteristics, the load factor of 1999 is computed at 65.5% and that of 2010 is assumed to be 70.5% with the analysis of a typical workday and holiday load. The reason why the load factors become high is that the load flattens out due to the structural change in industrial and household demand, the increase of daytime demand, and DSM.
(The issue of the forecast methods and the demand forecast for this study)
The present daily peak demand occurs in the evening lighting time, however it is expected that Vietnam’s demand shape will have two peaks in the daytime and evening in the near future and will move to a daytime leading shape. Therefore it is necessary in making a demand forecast in the future to follow variations in load shape with accuracy, and to have in view the fact, as mentioned in the Thailand section, that the increase of the load sensitive to temperature, such as use of air conditioners, makes the maximum power demand forecast complicated. There is nothing that needs to be particularly noted concerning the forecast techniques and forecast results of Vietnam, and the study used the submitted forecast. The demand forecast used for the Vietnam analysis is shown below and in Figure 2-23 and 2-24.
38 (Maximum power demand forecast of Vietnam in this study) The assumed values for 2010 and 2015 are 2.4 and 3.6 times those for 2000, and the average growth rate from 2000 to 2020 is 8.9%. The Load factor is 69% for 2010, 70% for 2015.
(Electric energy forecast of Cambodia in this study) The assumed values for 2010 and 2015 are 2.6 and 4.1 times those for 2000, and the average growth rate from 2000 to 2020 is 9.6%.
30000 180000 160000 25000 140000 20000 120000 100000 15000 80000 10000 60000 40000 5000 Electric Energy (GWh) 20000
Maximum Power Demand (MW) 0 0 2000 2005 2010 2015 2020 2000 2005 2010 2015 2020 Year Year
Figure 2-23 Maximum Power Demand Figure 2-24 Electric Energy Forecast Forecast (Vietnam) (Vietnam)
(3) Generating Facility (a) Present Situation Vietnam’s total installed capacity is 5,679MW. The power generation mix consists of 50% of hydropower, and 49% of thermal power including 7% of IPP. Table 2-6 gives an overview of the main generating facilities.
Table 2-6 Vietnam’s System Installed Capacity Type Installed Capacity (MW) Hydropower Plant 2,913 Coal-Fired Thermal Power Plant 645 Oil-Fired Thermal Power Plant 198 Gas Turbine Thermal Power Plant 1,152 Diesel Power Plant 397 (IPP Thermal Power Plant) 375 TOTAL 5,679 Source: EVN (1999).
39 All coal-fired thermal power plants are located in the north and all oil-fired thermal power plants are in the south. All gas turbine thermal power plants are sited in the southern regions, whose power demand is rapidly increasing, because the lead-time to operation is relatively short. Vietnam has a tight supply-demand situation for electricity in the north in the dry season because of the water shortage and in the south due to the rapid increase in power demand in recent years, and needs urgently to develop large power plants for a base load.
(b) Development Plan There were six power plants, total 2,580 MW, scheduled to go into service in 2001, twelve power plants, total 3,853 MW, in 2002 to 2005, and fifteen power plants, total 5,723 MW in 2006 to 2010. In addition, Vietnam plans to start the import of 700 MW electric power from Laos between 2002 and 2005 (See Figure 2- 25 and Table 2-7). The present daily load shape shows the difference at 2,000 MW and over between maximum and minimum demand. The industrialization may change the load pattern dramatically in the near future, and the well-balanced hydro and thermal power development would be needed in order to meet the change.
40,000 35,000 30,000 25,000 20,000 15,000 10,000
Installed Capacity (MW) 5,000 0 2000 2005 2010 2015 2020 Year Hydro Pumoed-Storage Hydro Import Coal Gas & Oil Geothermal Nuclear Source: EVN (2001).
Figure 2-25 Transition of Installed Capacity in Vietnam
40 Table 2-7 Power Plant Development Plan in Vietnam Year Power Plant Installed Capacity (MW) Pha Lai 2 TPP 600 Yaly HPP 3&4 360 Ham Thuan HPP 1 150 2001 Da Mi HPP 1 89 Phu My 1 ST 370 Total 1,569 Ba Ria add-on 306-2 GT 56 Ham Thuan HPP 2 150 Da Mi HPP 2 89 Phu My 2.1 ST 143 Na Duong TPP 100 Phu My 4 GT 288 Can Don HPP 72 Phu My 2.1 ST extension 140 Cao Ngan TPP 100 Phu My 4 ST 143 2002～2005 Phu My 2.2 GT 480 Omon TPP #1 300 Phu My 2.2 ST 240 Cam Pha TPP #1 150 Uong Bi TPP extension 300 Omon TPP #2 300 Ca Mau gas turbine C/C #1 360 Dai Binh HPP 300 Rao Quan HPP 70 Geo-Thermal Power 50 Total 3,831 Se San3 HPP 273 Cua Dat HPP 120 Ca Mau gas turbine C/C #2 360 Geo-Thermal Power 50 imported from Lao 300 Na Hang HPP（Dai Thi） 300 Thai Binh gas turbine C/C 360 A Vuong HPP 170 Hai Phong TPP #1 300 Ban Mai HPP（Ban La） 260 Dong Nai 3 HPP 240 2006～2010 Hai Phong TPP #2 300 Ca Mau gas turbine C/C #3 360 Dong Nai 4 HPP 270 imported from Lao 400 Cam Pha TPP#2 150 Ca Mau gas turbine C/C #3 360 Quang Ninh TPP #1 300 imported from Lao 300 Pleikrong HPP 120 Song Ba Ha HPP 200 Omon Gas-TPP #3 extension 300 Total 5,793
41 (4) Transmission and Distribution Facilities The completion of the North-South 500 kV transmission lines makes it possible to exchange electricity among the northern, central, and western systems. The voltage of the transmission system consists of 220 kV for the primary system, 110 kV for the secondary system, and 66 kV, which remains partly in the southern grid and has been upgraded to 110 kV. The distribution system has various types of voltage due to the historical background at present, however Vietnam plans to standardize the medium voltage to 22 kV in the urban area and 35 kV in the rural and mountainous area, and the low voltage to 220 V in the whole country. The transmission and substation development plan up to 2010 will build 4416 km of 500 kV, 4414 km of 220 kV, and 7757 km of 110 kV transmission lines, and relevant substations. It would be important hereafter to establish a master plan aimed at an effective power supply system including distribution. The transmission and distribution loss in Vietnam is currently over 15%, and Vietnam aims to reduce the loss to 10% or less up to about 2012 (Figure 2-26).
25
20
15
10 Loss (%)
5
0 1995 2000 2005 2010 2015 2020 Year Source: EVN (2001).
Figure 2-26 Transition of Transmission and Distribution Loss
(5) International Power Interconnection45 (a) Present Situation At present, Vietnam is supplying a small amount of electricity to the Huaphan and Savannakhet province in Laos. The voltage of transmission lines are 35 kV.
(b) Future Plan Vietnam has a plan to sign a PPA with Laos for an electricity supply from
45 Interview with the EVN.
42 Laos of 400 MW by 2009, a maximum of 1,400 MW by 2012, and finally 2,000 MW by 2020. However, the details of this power import project have not been confirmed46. Vietnam intends to connect with Laos for the first step and finally to conduct power exchange with Thailand, and a comprehensive F/S on system interconnection between Laos and Vietnam has been prepared. Vietnam has also a project to interconnect with Cambodia at 220kV in 2003. This interconnection project makes it possible to export 80 MW of electricity to Cambodia up to 2004 and 200 MW with effect from 2005. Besides, electricity supply projects of roughly 1.8MW to three Cambodian areas along the border are planned. And a system interconnection with the Yunnan province of China has been also discussed.
(6) Facilities Operation47 (a) Policy Hydropower takes precedence in the operation of power generating facilities. Combined cycle and coal-fired power stations are normally operated as a base load power station48. The Hoa Binh hydropower plant has charge of frequency control in the dry season49, and Tri An hydropower plant in the rainy season because the Hoa Binh hydropower plant is needed to operate to protect Hanoi from floods and has no capability to adjust frequency or its output50. The standard for frequency control is the rated frequency of 50 Hz ± 0.2 Hz. The voltage is controlled to the rated value ± 5 %. In regard to the output adjustment capability of a power plant, hydropower plants cannot adjust their output in the rainy season though they can in the dry season. Gas turbine power plants are capable of daily start and stop operations. It takes two hours to reach the rated output after receiving a starting order. IPP’s power plant sends electricity to EVN’s system according to the schedule that the national load dispatching center orders within annual electric energy generation set down by the contract between the EVN and the IPP. The EVN pays only an energy charge for generating amounts. For example, the Hiep
46 Two routes running from the Central and South of Laos are discussed. 47 Interview with the EVN and IE. 48 The target load factor for coal-fired, combined cycle, and gas turbine power stations to be developed in the future are designed at around 75%, 30%, 40% respectively. 49 Hydropower plants which have the functions of flood control and/or water adjustment for irrigation besides power generation, like the Hoa Binh hydropower station, discharge water in the off-peak time during the dry season if necessary. For example, the Hoa Binh hydropower plant puts one or two generating units in operation even at night in the dry season. 50 The Hoa Binh hydropower plant needs to reduce the water level of its reservoir against freshets in the rainy season, consequently its output decreases because of loss in effective water head.
43 Phuoc power plant sells 300 MW electric power, which is 375 MW of installed capacity minus 60 MW of internal power use. Similarly, the Phu My 3 power plant sells power of 6,000 hours of the total generating hours in a year. On the other hand, both energy and capacity charges are paid under the BOT contract.
(7) Electrification Rate Vietnam’s electrification rate reached 72% in 2000. The central part of Vietnam has seen a noticeable improvement in power supply in the wake of the completion of the North-South 500 kV transmission line. However, the electrification rate of the central region has been lower and there are still many isolated systems using diesel or small hydro units. In the case of the electrification to scattered villages in the mountains, the MOI gives financial assistance because of high construction costs and little profitability.
2.3 Support of Various Organizations for the Power Sectors in Indochina
(1) Japan Bank for International Cooperation (JBIC) JBIC’s assistance for the Indochina region in the power sector started with the Prek Thnot Power and Irrigation Development Project in Cambodia and the Lam Dome Noi Hydro-Electric Project. in Thailand in 1969. The assistance had concentrated on generation projects in the past, however JBIC has also implemented transmission and distribution projects focusing on stable and efficient power supply and rural electrification projects for poverty alleviation.
(2) World Bank (WB) The WB’s support for the power sector of the region began with the Yanhee Multipurpose Project in Thailand in 1957. Up to the early 1980s, the WB had provided support positively for power generation projects, including large-scale hydropower development. In recent years, however, the WB has focused on rural electrification programs contributing to poverty reduction and technical assistances (TAs) concerned with the institutional and organizational aspects of the power sector51 because of difficulties with large-scale projects, such as environmental impact or migration issues. The WB’s Power Trade Strategy for the Greater Mekong Sub-region study in
51 The WB supports the GMS program of the ADB with the TA concerning institutional aspects in regional power trade.
44 1999 suggested the importance of regional power trade including a power pool.
(3) Asian Development Bank (ADB) The ADB has provided assistance in the power sector mainly through the Greater Mekong Subregion (GMS) program and has carried out many rural electrification projects from the viewpoint of poverty reduction as well as the WB in the recent years. The Sub-regional Energy Sector Study for the Greater Mekong Sub-region by the ADB in 1995 indicated a comprehensive framework for energy development in Indochina. In the wake of the Asian Economic Crisis, however, the study’s findings turned out to be essentially unrealistic. Therefore, the ADB is conducting a new study focused on the policy framework for interconnected power systems, the viewpoint of least cost development and environmental protection, and the comparison between gas-fired thermal power and hydropower development.
(4) Association of Southeast Asian Nations (ASEAN) The power utilities and authorities of the ASEAN are in process of conducing a study named ASEAN Interconnection Master Plan Study. The analysis of generation aspects are made mainly by the EGAT of Thailand and transmission aspects are examined by the TNB of Malaysia. The members were supposed to complete this master plan study in March 2002 and present the report plus the examination of institutional aspects at the ASEAN Energy Ministers Conference in July 2002, but the progress of the master plan study is behind schedule.
2.4 Studies on the System Interconnection in the Indochina Region
(1) Mekong River Commission (MRC) In 1996, the MRC conducted the Mekong Integrated Transmission System Study (Basin-Wide), which examined the regional development of electric power and international power networks. The model on system interconnection of this study was adopted in the ADB’s on-going study Regional Indicative Master Plan on Power Interconnection in the GMS as one of the basic concepts.
(2) Asian Development Bank (ADB) As mentioned above, the ADB is carrying out a research project covering a comprehensive framework for power development, power interconnection, and power trade. (3) Institute of Developing Economies - Japan External Trade Organization (IDE- JETRO)
45 The EGAT and TEPCO studied the optimum system interconnection for efficient power development and useful power exchange in cooperation with each other. The EGAT and TEPCO held a seminar to discuss the findings of this joint study in Bangkok with experts from power utilities and authorities in the GMS countries and officers of the ADB and WB attending.
46