Study on Independent Power Producers (Ipps) in Lao People's Democratic Republic
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Study on Economic Partnership Projects in Developing Countries in FY2016 Study on Independent Power Producers (IPPs) in Lao People's Democratic Republic Final Report February 2017 Prepared for: Ministry of Economy, Trade and Industry Prepared by: Tokyo Electric Power Company Holdings, Inc. Hokuriku Electric Power Company, Inc. Reproduction Prohibited Ministry of Economy, Trade and Industry Study on Economic Partnership Projects in Developing Countries in FY2016 February 2017 Prepared by Study on Independent Power Producers (IPPs) in Lao People's Democratic Republic Tokyo Electric Power Company Holdings, Inc. Hokuriku Electric Power Company, Inc. Preface This report puts together the findings and results of Economic Partner Projects for Fiscal Year 2016 undertaken by Tokyo Electric Power Company Holdings Inc., together with Hokuriku Electric Power Co., contracted and funded by the Ministry of Energy, Trade and Industry of Japan. This study, “Project Identification Study on Independent Power Producers (IPPs) in Lao People’s Democratic Republic,” aimed to identify several IPP projects for investment targets in the country and survey the maturity, hydrology, socio-environmental conditions, sponsors’ requirements, etc. of hydropower projects, in close collaboration with candidate sponsors for investment and with attentive assistance from the Ministry of Energy and Mines, the Ministry of Planning and Investment, and several Prefecture Offices in Lao PDR. We strongly hope that this report helps to realize these projects and that it will serve as a useful reference for related parties in Japan. February 2017 Tokyo Electric Power Company Holdings, Incorporated Hokuriku Electric Power Company, Incorporated Project map Source: Study team based on GoogleMap List of abbreviations Abbreviation Definition ADB Asian Development Bank ASEAN Association of South East Asian Countries CA Concession Agreement COD Commission of Day DEB Department of Energy Business DEPP Department of Energy Policy And Planning DSCR Debt Service Coverage Ratio EBRD European Bank for Reconstruction and Development EDL Electricite du Laos EIA Environmental Impact Assessment ESIA Environmental and Social Impact Assessment F/S Feasibility Study GDP Gross Domestic Product GIS Geographic Information System GW Giga Watt GWh Giga Watt Hour IEE Initial Environmental Examination IFC International Finance Corporation IPPs Independent Power Producers JBIC Japan Bank for International Cooperation JICA Japan International Cooperation Agency MEM Ministry of Energy and Mines METI Ministry of Economy, Trade and Industry MOF Ministry of Finance MOI Ministry of Industry MONRE Ministry of Natural Resources And Environment MOU Memorandum of Understanding MPI Ministry of Planning and Investment MW Mega Watt MWh Mega Watt Hour NEDO New Energy and Industrial Technology Development Organization ODA Official Development Assistance PDA Project Development Agreement PECC1 Power Engineering Consulting joint stock Company 1 PPA Power Purchase Agreement PPP Public Private Partnership SIA Social Impact Assessment SPC Super Purpose Company USD United States Dollar UXO Unexploded Ordnance Contents Preface Project map List of abbreviations Table of contents Summary Capter1 Introduction ..................................................................................................................................................1-1 (1) Background and circumstances of the survey .....................................................................................................1-1 (2) Purpose of survey .............................................................................................................................................1-1 (3) Survey method .................................................................................................................................................1-1 1) Content of survey .........................................................................................................................................1-1 2) Survey method / organization ........................................................................................................................1-2 3) Survey schedule ...........................................................................................................................................1-3 4) Survey results ...............................................................................................................................................1-3 Capter2 Overview of the Host Country and Sector .....................................................................................................2-1 (1) Economy ..........................................................................................................................................................2-1 (2) Electricity Sector ..............................................................................................................................................2-2 (3) Situation of the target area .................................................................................................................................2-4 Capter3 Identification of promising investment projects ..............................................................................................3-1 (1) The long list of projects .....................................................................................................................................3-1 1) Existing hydropower plants ...........................................................................................................................3-1 2) Hydropower projects under construction .......................................................................................................3-4 3) Hydropower projects with COD expected by 2025 ........................................................................................3-7 4) Hydropower projects with COD expected by 2030 ........................................................................................3-9 5) Hydropower projects with signed MOU ...................................................................................................... 3-11 (2) Screening and evaluation criteria for prioritization ........................................................................................... 3-15 1) Screening policy ........................................................................................................................................ 3-15 2) Sorting lists by number of projects in old list ............................................................................................... 3-16 3) Sorting lists by number of projects in new list ............................................................................................. 3-17 4) Sorting lists by capacity potential ............................................................................................................... 3-18 5) List sorted by river flow ............................................................................................................................. 3-19 6) Listing sponsors ........................................................................................................................................ 3-22 (3) Long list of promising projects narrowed down .............................................................................................. 3-23 (4) Candidate projects for investment ................................................................................................................... 3-23 Capter4 Justification, Objectives and Technical Feasibility of the Projects ...................................................................4-1 (1) Background to Technical Feasibility of the Projects ............................................................................................4-1 1) Projects by Nonghai Group ...........................................................................................................................4-1 2) Projects by Electrical Construction and Installation, State Enterprise...............................................................4-1 (2) Basic policies and decisions on the content of the Technical Feasibility of the Projects ........................................4-1 (3) Outline of Technical Feasibility of the Projects ...................................................................................................4-2 (4) Necessary Study Items ......................................................................................................................................4-4 1) Extraction of Items for Consideration regarding Technical Aspects of Promising Project .................................4-4 2) Outline and Verification of Flow Setting in Candidate Project ........................................................................4-5 3) Outline and Confirmation of Head Loss and Rate Head in the Candidate Project ......................................... 4-24 4) Outline and Confirmation of Project Cost in Candidate Project ................................................................... 4-32 (5) Effect of Stable Energy Supply to Japan by Implementing Candidate Projects ................................................. 4-44 Capter5 Evaluation of Environmental and Social Impacts ...........................................................................................5-1 (1) Analysis of present state of environmental and social aspects