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Assessment of the Greater Mekong

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Assessment of the Greater Mekong ASSESSMENT OF THE GREATER MEKONG SUBREGION ENERGY SECTOR DEVELOPMENT PROGRESS, PROSPECTS, AND REGIONAL INVESTMENT PRIORITIES ASSESSMENT OF THE GReaTER MEKONG SUBREGION ENERGY seCTOR DEVELOPMENT PROGRESS, PROSPECTS, AND REGIONAL INVESTMENT PRIORITIES © 2013 Asian Development Bank All rights reserved. Published in 2013. Printed in the Philippines. ISBN 978-92-9254-051-7 (Print), 978-92-9254-052-4 (PDF) Publication Stock No. RPT135674-2 Cataloging-in-Publication Data Asian Development Bank. Assessment of the Greater Mekong Subregion energy sector development: Progress, prospects, and regional investment priorities. Mandaluyong City, Philippines: Asian Development Bank, 2013. 1. Energy. 2. Power trade. 3. Regional power market. 4. Greater Mekong Subregion. I. Asian Development Bank. The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. ADB encourages printing or copying information exclusively for personal and noncommercial use with proper acknowledgment of ADB. Users are restricted from reselling, redistributing, or creating derivative works for commercial purposes without the express, written consent of ADB. Photos on cover were taken from the ADB photo archive. Notes: In this publication, “$” refers to US dollars. In the references list, ADB recognizes Burma by the name Myanmar; Laos by the name Lao People's Democratic Republic. Asian Development Bank 6 ADB Avenue, Mandaluyong City 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 www.adb.org For orders, please contact: Department of External Relations Fax +63 2 636 2648 [email protected] Printed on recycled paper. Contents List of Tables v Acknowledgments vi Abbreviations vii Weights and Measures ix Executive Summary x National Programs 1 Policy 1 Organization of the Power Sector 6 Power System Development 11 Extending Access to Electricity 22 Policy for Renewable Energy 27 Policy for Energy Efficiency 34 Private Finance 39 Regional Supply–Demand Prospective 44 Greater Mekong Subregion Regional Energy Connectivity 46 The Greater Mekong Subregion Regional Power Trade 46 The ASEAN Power Grid 50 Trans-ASEAN Gas Pipeline 51 Assessment of Connectivity 52 Regional Programs 54 The Vientiane Plan of Action for Greater Mekong Subregion Development, 2008–2012 54 The Road Map for Expanded Energy Cooperation 67 Road Map for Implementing the Greater Mekong Subregion Cross-Border Power Trading 70 Energy Sector Strategy Study 72 Pertinent International Programs 74 Post-Kyoto Mechanisms 74 Sustainable Energy for All 75 Environmental and Social Assessment 76 Mekong River Commission 76 Strategic Environmental Assessment of Hydropower on the Mekong Mainstream 77 Expert Monitoring of Nam Thuen 2 77 Reports by Academia and Civil Society 78 The GMS Environment Operations Center 79 iii Contents Strategic Guidelines for Greater Mekong Subregion Regional Cooperation 81 Greater Mekong Subregion Strategic Framework, 2012–2022 81 ASEAN Economic Community Blueprint 82 Master Plan for ASEAN Connectivity 82 The Long-Term Strategic Framework of ADB 83 Regional Cooperation Operations Business Plan 84 Gap Analysis 86 Energy Networks 86 Development Gaps Remain Very Large 88 There Is Much to Be Done for Energy Efficiency 89 Renewable Policy Needs to Be Strengthened 90 Biofuels Need Second Generation Technologies 90 Arrangements for Private Sector Financing Still Need Attention 91 Socioenvironmental Management and Enforcement 92 Clean Coal 92 Capacity for Regional Prospective Studies Is Needed 93 Implications of the Opening Up of Myanmar 94 Implementation of the Program through the Subregional Energy Forum 95 Potential Activities and Results Framework 97 References 104 iv List of Tables Tables 1 Summary Conclusions for Energy Policy 6 2 Summary Conclusions for the Organization of the Power Sector 10 3 Generation Expansion Plan for Cambodia 12 4 Existing and Planned Cross-Border Links 13 5 Existing and Planned Cross-Border Links 15 6 Potential Hydropower Plants near Borders of Myanmar 15 7 Expected Capacity Imports from Myanmar 16 8 Power Plant Projects from 2010–2020, and from 2020–2030 17 9 Existing, Expected, and Possible Cross-Border Connections from Thailand 19 10 Existing and Planned High-Voltage Cross-Border Connections 20 11 Lending in the Country Operations Business Plan for 2012–2014 21 12 Summary Conclusions for Power System Development 22 13 Electrification Rates and Per Capita Consumption, 2009 26 14 Summary Conclusions for Rural Electrification 27 15 Tentative Renewable Additions under the Power Development Plan to 2022 31 16 Summary Conclusions for Renewable Energy 33 17 Summary Conclusions for Energy Efficiency Policy 39 18 Summary Conclusions for Private Finance 45 19 Primary Energy Consumption in 2030 by Country 45 20 Possible Electricity Trade in 2020 and 2025 49 21 Selected Interconnection Projects, AIMS II 51 22 Enhanced Efficiency and Security and Sustainable Development of Resources 55 23 Building Capacity for Operation, Coordination, and Grid Interconnection 60 24 Implementing Key Interconnection Projects for Stage 1 Power Trading 61 25 Developing Generation Projects for Power Exports under Stage 1 64 26 Examples of a Greater Mekong Subregion-Level Value Added 69 27 Assessment of the Cross-Border Power Trade Road Map 71 28 Nongovernment Organizations Active in Social and Environmental Impacts of Energy 79 29 Summary of Energy Activities in the 2012–2014 Regional Cooperation Operations Business Plan 85 30 Population Below the National Poverty Line and Per Capita Income, 2010 88 31 Potential Activities and Selection Criteria 97 32 Simplified Results Framework for the Tentative Proposals 101 v Acknowledgments This report was prepared by Prof. Nigel Lucas, energy consultant to the Asian Development Bank (ADB), under the overall guidance and direction of Pradeep Srivastava of the Greater Mekong Subregion (GMS) Unit of ADB’s Southeast Asia Department (SERD). Valuable technical inputs and advice were provided by Anthony Jude and Jong-Inn Kim of ADB’s Energy Division at SERD, and Jesusito Tranquilino, GMS consultant. Helpful coordination work for the publication of this report was provided by Georginia Nepomuceno, GMS consultant. The report was presented at the Thirteenth Meeting of the GMS Regional Power Trade Coordination Committee held in Yangon, Myanmar on 27 November 2012, and has benefited from the views expressed by the meeting participants. vi Abbreviations ADB – Asian Development Bank AEEMTRC – ASEAN–EU Energy Management Training and Research Centre AIMS – ASEAN Interconnection Master Plan Study APAEC – ASEAN Programs of Action for Energy Cooperation APEC – Asia-Pacific Economic Cooperation APG – ASEAN Power Grid ASCOPE – ASEAN Council on Petroleum ASEAN – Association of Southeast Asian Nations BAU – business-as-usual BOT – build–operate–transfer CCS – carbon capture and storage CDC – Council for the Development of Cambodia CO2 – carbon dioxide CSG – China Southern Power Grid DSM – demand-side management EAC – Electricity Authority of Cambodia EDC – Electricité du Cambodge EDL – Electricité du Laos EEDP – Energy Efficiency Development Plan EGAT – Electricity Generating Authority of Thailand EGP – Experts Group on Power Interconnection and Trade ENCON Fund – Energy Conservation Promotion Fund EOC – Environment Operations Center EPD – Energy Planning Department EPPO – Energy Policy and Planning Office (Thailand) ERAV – Electricity Regulatory Authority of Vietnam ERC – Energy Regulatory Commission (Thailand) ETS – Emissions Trading System EU ETS – European Emissions Trading System EVN – Electricity of Vietnam FIT – feed-in tariff GDP – gross domestic product GEF – Global Environment Facility GHG – greenhouse gas HAPUA – Heads of ASEAN Power Utilities and Authorities HPP – hydroelectric power plant HVDC – high-voltage direct current IAG – International Advisory Group IEA – International Energy Agency IEEJ – Institute of Energy Economics, Japan IFI – international financial institution IGA – intergovernmental agreement IGCC – integrated gasification combined cycle IMF – International Monetary Fund IPO – initial public offering IPP – independent power producer JETRO – Japan External Trade Organization vii Abbreviations LMB – Lower Mekong Basin LNG – liquefied natural gas LPG – liguefied petroleum gas MEA – Metropolitan Electricity Authority (Thailand) MEM – Ministry of Energy and Mines (Lao People’s Democratic Republic) MEPS – Minimum Energy Performance Standard MIME – Ministry of Industry, Mines and Energy (Cambodia) MOE – Ministry of Energy (Myanmar) MOEP – Ministry of Electric Power (Myanmar) MOGE – Myama Oil and Gas Enterprise MOIT – Ministry of Industry and Trade (Viet Nam) MOU – memorandum of understanding MPI – Ministry of Planning and Investment (Viet Nam) MRC – Mekong River Commission NAMA – Nationally Appropriate Mitigation Action NDRC – National Development and Reform Commission (People’s Republic of China) NEA – National Energy Administration (People’s Republic of China) NEC – National Energy Commission (People’s Republic of China)
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