Independent State of Papua New Guinea Department of Petroleum and Energy PNG Power Ltd. THE PROJECT FOR FORMULATION OF RAMU SYSTEM POWER DEVELOPMENT MASTER PLAN AND LAE AREA DISTRIBUTION NETWORK IMPROVEMENT PLAN FINAL REPORT PART A : POWER DEVELOPMENT MASTER PLAN OF RAMU POWER SYSTEM September 2016 Japan International Cooperation Agency NEWJEC Inc. PN JR 16-003 Final Report Table of Contents Part A: Power Development Master Plan of Ramu Power System List of Figures, Tables and Pictures The Project for Formulation of Ramu System Power Development Master Plan and Lae Area Distribution Network Improvement Plan FINAL Report Part A : Power Development Master Plan of Ramu Power System Table of Contents Chapter 1 Introduction 1.1 Background .................................................................................................................... 1 - 1 1.2 Objective of the Study .................................................................................................... 1 - 1 1.3 Outline of the Study ....................................................................................................... 1 - 1 1.4 Implementation Structure for the Study ......................................................................... 1 - 2 1.5 Overall Work Schedule of the Study ............................................................................. 1 - 3 1.6 Technical Transfer Program ........................................................................................... 1 - 4 1.7 Public Information Activity ........................................................................................... 1 - 9 Appendix 1 Public Information Activity Chapter 2 Present State of the Power Sector 2.1 Present State of the Power Policy in PNG ..................................................................... 2 - 1 2.1.1 PNG National Plan ............................................................................................ 2 - 1 2.1.2 Energy Policies ................................................................................................. 2 - 2 2.2 Present State of the Energy Sector and Power Sector .................................................... 2 - 7 2.2.1 Energy Sector Structure .................................................................................... 2 - 7 2.2.2 Power Sector Structure ...................................................................................... 2 - 8 2.2.3 Power Development Plan .................................................................................. 2 - 10 2.2.4 Procurement of Fuel Oil .................................................................................... 2 - 14 2.2.5 Rural Electrification .......................................................................................... 2 - 17 2.2.6 Activities of Donors .......................................................................................... 2 - 19 2.3 Reform of the Energy Sector.......................................................................................... 2 - 23 Chapter 3 Primary Energy 3.1 Status of Primary Energy in PNG .................................................................................. 3 - 1 3.1.1 Overview ........................................................................................................... 3 - 1 3.1.2 Hydropower ...................................................................................................... 3 - 3 3.1.3 Oil and Natural Gas........................................................................................... 3 - 6 3.1.4 Coal ................................................................................................................... 3 - 13 3.1.5 Renewable Energy ............................................................................................ 3 - 14 3.2 Outlook on Primary Energy for the Ramu System toward 2030 ................................... 3 - 22 3.2.1 Evaluation of Each Energy Resource ................................................................ 3 - 22 3.2.2 Table Summarizing the Promising Energy Resources in the Ramu System toward 2030 ...................................................................................................... 3 - 33 3.2.3 Energy Resources Map in the Ramu System .................................................... 3 - 34 - i - The Project for Formulation of Ramu System Power Development Master Plan and Lae Area Distribution Network Improvement Plan Table of Contents Final Report List of Figures, Tables and Pictures Part A: Power Development Master Plan of Ramu Power System 3.3 Draft Conclusions and Recommendations ..................................................................... 3 - 35 3.3.1 Conclusion ......................................................................................................... 3 - 35 3.3.2 Recommendation ............................................................................................... 3 - 35 Chapter 4 Power Demand Forecast 4.1 Power Demand Forecast of the Ramu System ............................................................... 4 - 1 4.1.1 Background ....................................................................................................... 4 - 1 4.1.2 Current Power Demand Status .......................................................................... 4 - 1 4.1.3 Methodology for Demand Forecast ................................................................... 4 - 5 4.1.4 Demand Forecast Results .................................................................................. 4 - 6 4.1.5 Considerations ................................................................................................... 4 - 17 4.1.6 Issues and Recommendations ............................................................................ 4 - 18 Chapter 5 Study for the Development Sites for Each Candidate Power Plant 5.1 Hydro Power .................................................................................................................. 5 - 1 5.1.1 Current Status of Hydropower Facilities ........................................................... 5 - 1 5.1.2 Operation and Maintenance of Hydropower Facilities ..................................... 5 - 29 5.1.3 Rehabilitation / Refurbishment of Existing Hydropower Plants ....................... 5 - 34 5.1.4 Current Hydropower Development Plan ........................................................... 5 - 37 5.1.5 Candidate Hydro Power Plans for the Future .................................................... 5 - 53 5.1.6 Findings and Recommendations ....................................................................... 5 - 55 5.2 Thermal Power Station ................................................................................................... 5 - 58 5.2.1 Current Status of Thermal Power Station.......................................................... 5 - 58 5.2.2 Diesel Engine Generation Facilities Plan .......................................................... 5 - 96 5.2.3 Gas Turbine Generation Facilities Plan ............................................................. 5 - 97 5.3 Renewable Energy .......................................................................................................... 5 - 99 5.3.1 Solar Power Plant .............................................................................................. 5 - 99 5.3.2 Biomass Power Plant ......................................................................................... 5 - 101 Appendix 5.1 Hydropower Chapter 6 Optimal Power Generation Development Plan 6.1 Issue of Power Generation Development in the PDP ..................................................... 6 - 1 6.2 Power Generation Development Plan ............................................................................ 6 - 4 6.3 Scenario of Power Development Plan ............................................................................ 6 - 12 6.4 Current Situation of the Ramu System and Possible Power Source .............................. 6 - 14 6.5 Development Policy in the Ramu System ...................................................................... 6 - 16 6.6 Optimal Power Generation Development Plan .............................................................. 6 - 19 Existing and Potential Power Development ...................................................... 6 - 19 6.6.2 Power Development Scenario ........................................................................... 6 - 25 6.6.3 Basic Conditions for the Power Generation Development Plan ....................... 6 - 29 6.6.4 Optimal Power Generation Development Program ........................................... 6 - 32 6.6.5 Optimal Generation Expansion Plan ................................................................. 6 - 36 6.6.6 Comparison of Each Scenario ........................................................................... 6 - 50 6.6.7 Countermeasures for Current Issues.................................................................. 6 - 54 6.6.8 Impact of the Uncertainty of Large Mining Demands ...................................... 6 - 57 6.7 Recommendations for the Power Generation Expansion Plan ....................................... 6 - 63 The Project for Formulation of Ramu System Power Development - ii - Master Plan and Lae Area Distribution Network Improvement Plan Final Report Table of Contents Part A: Power Development Master Plan of Ramu Power System List of Figures, Tables and Pictures Chapter 7 Power