CEYLON ELECTRICITY BOARD LONG TERM GENERATION EXPANSION PLAN 2013-2032 Transmission and Generation Planning Branch Transmission Division Ceylon Electricity Board Sri Lanka October 2013 Long Term Generation Expansion Planning Studies 2013- 2032 Compiled and prepared by The Generation Planning Unit Transmission and Generation Planning Branch Ceylon Electricity Board, Sri Lanka Long-term generation expansion planning studies are carried out every two years by the Transmission & Generation Planning Branch of the Ceylon Electricity Board, Sri Lanka and this report is a bi-annual publication based on the results of the latest expansion planning studies. The data used in this study and the results of the study, which are published in this report, are intended purely for this purpose. Price Rs. 3000.00 © Ceylon Electricity Board, Sri Lanka, 2013 Note: Extracts from this book should not be reproduced without the approval of General Manager – CEB Foreword The ‘Report on Long Term Generation Expansion Planning Studies 2013-2032’, presents the results of the latest expansion planning studies conducted by the Transmission and Generation Planning Branch of the Ceylon Electricity Board for the planning period 2013- 2032, and replaces the last of these reports prepared in April 2011. This report, gives a comprehensive view of the existing generating system, future electricity demand and future power generation options in addition to the expansion study results. The latest available data were used in the study. The Planning Team wishes to express their gratitude to all those who have assisted in preparing the report. We would welcome suggestions, comments and criticism for the improvement of this publication. October 2013. Transmission and Generation Planning Branch Letters: 5th Floor, Head Office Bldg. Tr. and Generation Planning Branch Ceylon Electricity Board 5th Floor, Ceylon Electricity Board Sir Chittampalam A. Gardinar Mw. P.O. Box 540 Colombo 02 Colombo, Sri Lanka e-mail : [email protected] Tel : +94-11-2329812 Fax : +94-11-2434866 Prepared by: Reviewed by: M.B.S Samarasekara Y.M Samarasinghe Chief Engineer (Gen. Plan. and Design) Additional General Manager (Transmission) S.H Midigaspe T.A.K Jayasekera Former Chief Engineer (Gen. Plan. and Design) Deputy General Manager (Trans. & Gen. Planning) Electrical Engineers A.D Tillekeratne Former Deputy General Manager (Trans. & Gen. Planning) M.T.K De Silva T.L.B Attanayaka D.C Hapuarachchi R.B Wijekoon B.G.D.L Sumudith Any clarifications sought or request for copies of the report should be sent to the Deputy General Manager (Transmission and Generation Planning) at the address above. CONTENTS Page Contents i Annexes iv List of Tables v List of Figures vi Acronyms vii Executive Summary E - 1 1. Introduction 1 - 1 1.1 Background 1 - 1 1.2 The Economy 1 - 1 1.2.1 Electricity and Economy 1 - 2 1.2.2 Economic Projections 1 - 2 1.3 Energy Supply and Demand 1 - 3 1.3.1 Energy Supply 1 - 3 1.3.2 Energy Demand 1 - 4 1.4 Electricity Sector 1 - 4 1.4.1 Access to electricity 1 - 4 1.4.2 Electricity Consumption 1 - 5 1.4.3 Capacity and Demand 1 - 6 1.4.4 Generation 1 - 8 1.5 Planning Process 1 - 9 1.6 Objectives 1 - 9 1.7 Organization of the Report 1 - 10 1.8 Codes / Guidelines in Generation Expansion Planning 1 - 10 2. The Existing Committed Generating System 2 - 1 2.1 Hydro and Other Renewable Power Generation 2 - 1 2.1.1 CEB Owned Hydro and Other Renewable Power Plants 2 - 1 2.1.2 Hydro and Other Renewable Power Plants Owned by IPPs 2 - 5 2.1.3 Capability of Existing Hydropower Plants 2 - 5 2.2 Thermal Generation 2 - 8 2.2.1 CEB Thermal Plants 2 - 8 2.2.2 Independent Power Producers (IPPs) 2-10 3. Electricity Demand: Past and the Forecast 3 - 1 3.1 Past Demand 3 - 1 3.2 Demand Forecasting Methodology 3 - 3 3.3 Demand Forecast 3 - 5 3.4 Sensitivities to the Demand Forecast 3 - 6 3.5 Comparison with Past Forecasts 3 - 7 4 Conventional Generation Options for Future Expansions 4 - 1 4.1 Hydro Options with a Projected Committed Development 4 - 1 4.1.1 Candidate Hydro Projects 4 - 1 4.1.2 Available Studies on Hydro Projects 4 - 2 4.1.3 Details of the Candidate hydro Projects 4 - 2 Page i 4.1.4 Current status of non Committed Hydro Projects 4 - 4 4.2 Hydro - Capacity Extensions 4 - 4 4.2.1 Samanalawewa 4 - 4 4.2.2 Laxapana Complex 4 - 4 4.2.3 Mahaweli Complex 4 - 4 4.2.4 Pump Storage Option 4 - 5 4.3 Thermal Options 4 - 5 4.3.1 Available Studies for Thermal Plants 4 - 5 4.3.2 Thermal Power Candidates 4 - 6 4.3.3 Candidate Thermal Plant Details 4 - 6 4.3.4 Fuel 4 - 8 4.3.5 Screening of Generation Options 4 - 9 4.3.6 Thermal Plant Specific Cost Comparison 4 -10 4.3.7 Current status of non Committed Thermal Projects 4 -10 4.4 India-Sri Lanka Transmission Interconnection 4 -11 5. Non Conventional Renewable Generation Options for Future Expansions 5 - 1 5.1 Mini / Micro Hydro 5 - 3 5.2 Wind 5 - 4 5.3 Wood Fuel / Dendro Power 5 - 5 5.4 Solar 5 - 5 5.5 Municipal Solid Waste 5 - 6 5.6 Other 5 - 6 5.7 Net Metering 5 - 6 5.8 Inclusion of NCRE in the LTGEP 5 - 7 5.9 Development of NCRE 5 - 7 6. Generation Expansion Planning Methodology and Parameters 6 - 1 6.1 Grid Code Generation Planning 6 - 1 6.2 National Energy Policy 6 - 1 6.3 Preliminary Screening of Generation Options 6 - 2 6.4 Detailed Planning Exercise 6 - 2 6.4.1 SYSIM Simulation Module 6 - 3 6.4.2 WASP Package 6 - 3 6.4.3 Hydro Power Development 6 - 3 6.4.4 Assessment of Environmental Implications and Financial Scheduling 6 - 3 6.4.5 Modeling of NCRE 6 - 4 6.5 Study Parameters 6 - 4 6.5.1 Study Period 6 - 4 6.5.2 Economic Ground Rules 6 - 4 6.5.3 Plant Commissioning and retirements 6 - 4 6.5.4 Cost of Energy Not Served (ENS) 6 - 5 6.5.5 Loss of Load Probability (LOLP) 6 - 5 6.4.6 Reserve Margin 6 - 5 6.4.7 Discount Rate 6 - 5 6.4.8 Assumptions and Constraints Applied 6 - 5 Page ii 7. Results of Generation Expansion Planning Study 7 - 1 7.1 Results of the Preliminary Screening of Generation Options 7 - 1 7.2 Base Case Plan 7 - 1 7.2.1 System Capacity Distribution 7 - 3 7.2.2 System Energy Share 7 - 5 7.2.3 Fuel, Operation and Maintenance 7 - 7 7.2.4 Reserve Margin and LOLP 7 - 8 7.2.5 Investment, Pricing and Environmental Implications 7 - 9 7.3 Demand Effect on Base Plan 7 - 9 7.3.1 Capacity Distribution 7 - 9 7.3.2 Fuel requirement 7 - 10 7.4 Effects of Discount rate on Base Case Plan 7 - 11 7.4.1 Capacity Distribution 7 - 11 7.4.2 Fuel requirement 7 - 11 7.5 Effects of Cost of Energy Not Served over Base Case 7 - 11 7.6 Fuel Price Effect on Base Case Plan 7 - 11 7.7 High NCRE Scenario 7 –12 7.8 Restricted Coal Development to achieve Energy Security 7 - 12 7.9 Determination of LNG Fuel Breakeven price and CDM Benefits 7 - 14 7.10 Effect on Demand Side Management on Base Case 7 - 15 7.11 Social and Environmental Damage Cost Scenario 7 - 15 7.12 Pump Storage Plant and HVDC Interconnection Scenarios 7 –15 7.13 Summary 7 - 16 8. Implementation and Financing of Generation Projects 8 - 1 8.1 Committed Power Plants in the Base Case 8 - 1 8.1.1 Committed Plants 8 - 1 8.1.2 Present Status of the Committed Power Plants 8 - 1 8.2 Proposed Power Plants in the Base Case 8 - 2 8.3 Implementation Schedule 8 - 2 8.4 Required Investment for Base Case 2013 - 2032 8 - 4 8.5 Recommendations for Base Case 8 - 4 8.6 Investment requirement variation for scenarios 8 - 5 9. Environmental Implications 9 - 1 9.1 Greenhouse Gases 9 - 1 9.2 Country Context 9 - 1 9.3 Emission Control Technologies 9 - 3 9.4 Emission Factors Used 9 - 4 9.5 Environmental Implications –Base Case 9 - 5 9.6 Environmental Implications – Other Scenarios 9 - 6 9.7 Climate Change 9 -10 10. Revision to Previous Plan 10.1 Introduction 10 - 1 10.2 Demand Forecast 10 - 1 10.3 Fuel Prices 10 - 4 10.4 Status of Last year Base Case Plan 10 - 5 10.5 Overall Comparison 10 - 6 Page iii References R - 1 Annexes Annex 2.1 Reservoir System in Mahaweli, Kelani and Walawe River Basins A2 - 1 Annex 3.1 Sensitivities of Demand Forecast A3 - 1 Annex 4.1 Candidate Hydro Plant Data Sheets A4 - 1 Annex 4.2 Cost Calculations of Candidate Hydro Plants A4 - 3 Annex 4.3 Candidate Thermal Plant Data Sheets A4 - 4 Annex 5.1 2011 NCRE Tariff Announced by the PUCSL A5 - 1 Annex 5.2 Renewable Generation Addition in High NCRE Scenario A5 - 2 Annex 6.1 Methodology of the Screening of Curve A6 - 1 Annex 7.1 Screening of Generation Options A7 - 1 Annex 7.2 Capacity Balance for the Base Case – 2012 A7 - 4 Annex 7.3 Energy Balance for the Base Case – 2012 A7 - 5 Annex 7.4 Annual Generation and Plant Factors - Base Case 2012 A7 - 6 Annex 7.4.1 Annual Generation Dispatch with NCRE Reconciliation for the Base Case-2012 A7 - 14 Annex 7.5 Fuel Requirements and Expenditure on Fuel 2012 A7 - 15 Annex 7.6 PUCSL Reference Case A7 - 16 Annex 7.7 High Demand Case A7 - 17 Annex 7.8 Low Demand Case A7 - 18 Annex 7.9 High Discounts (15%) Case A7 - 19 Annex 7.10 Low Discounts (3%) Case A7 - 20 Annex 7.11 50% High ENS cost Case A7 - 21 Annex 7.12 Coal, Oil 50% Price High, and LNG Base Price Case A7 - 22 Annex 7.13 Coal 50% Price High and Oil, LNG Base Price Case A7 - 23 Annex 7.14 High NCRE 20% at 2020 Case A7 - 24 Annex 7.15 No Coal Plants permitted after Trinco Coal A7 - 25 Annex 7.16 Coal Limited around 60% from total Generation Case A7 - 26 Annex 7.17 Dendro Candidate with Local Fuel Concession Case A7 - 27 Annex 7.18 Pump Storage Forced Operation and Forced Construction in 2020 Case A7 - 28 Annex 7.19 No Coal plants permitted after 2025 A7 - 29 Annex 7.20 Social and Environment Damage Cost Case A7 - 30 Annex 7.21 Trincomalee two coal units permitted only in