Challenges and

Opportunities for Smart Grid

in Asia and the Pacific

N. Sakai Senior Climate Change Specialist

Asian Development Bank

4 April 2013, Tokyo, Japan

Outline

• Introducing ADB

• Issues and Challenges for Smart Grid in Asia and the Pacific

• Turning the Challenges into Opportunities

The views expressed in this presentation are those of the author and do not necessarily

reflect the views and policies of the Asian Development Bank, or its Board of Governors

or the governments they represent.

Who we are, what we do and aim for

• ADB is a multilateral development bank that aims for an Asia and Pacific region free of poverty

• It has an annual lending of around $14 billion, 30% or $4-5 billion of which is attributed to energy sector investments

Who we are, what we do and aim for

• ADB’s Energy Sector operations is guided by the 2009 Energy Policy that has the following pillars for implementation:

• Promotion of energy efficiency and renewable energy

• Maximizing access for energy for all

• Energy sector governance, reforms and capacity building

Energy Issues and Challenges in Asia and the Pacific

• There are two critical challenges being faced by the Asia and Pacific region:

• Energy security

• Climate change

• This challenges can be addressed through:

• Increased energy efficiency

• More renewable energy generation in the energy mix

The Smart approach

• Smart grid/community can play an important role in energy efficiency

• It is a technology that manages the flow of electricity between supply and demand thereby increasing system efficiency and reliability; and allow the integration of renewable energy supply, distributed energy resources and e-vehicle charging

• Battery will play a key role.

Turning challenges into opportunities for smart grid deployment in Asia and the Pacific

Challenge

• Lack of knowledge and awareness

• Appropriate business models

• Financing requirement

• Inadequate regulatory and institutional framework

Opportunity

• Develop capacity and knowledge and transfer technology

• Initiate pilot projects to assess feasibility and replication

• Innovative financing and PPP

• Governance and sector reforms

Smart grid/community in the context of developing Asia

Context

• Countries in Asia and the Pacific are diverse and in various levels of economic development

• Corresponding power systems, regulatory institutions and state of power utilities vary across countries

• Each country may take a different path and approach to integrating smart grid and would have varying adoption rates

Starting points for Smart grid/community in developing Asia

Entry/starting points

• Power Storage would be one of key factor for success

• Build on existing IT infrastructure

• May not necessarily start as state-of-the art smart system

• Address commercial and technical losses

• Apply controlled load shedding

• Remote control of non-payment through disconnection

• Renewable energy grid integration

Case1 : India Transmission

Entry/starting points

• POWERGRID and state TRANSCOs will integrate renewable energy by developing Energy System Management Center (ESMC) at national, regional, and state levels.

• ADB will provide technical and financial assistances to state level ESMCs at Gujarat, Maharashtra, Rajasthan with Clean Technology Fund (CTF) to evacuate large scale wind and solar power. Batteries may be included in the contract package.

Case 2 : Maldives Microgrid

Entry/starting points

• The Government of Maldives (GOM) plans to deploy solar-microgrids to rural islands using hybrid of diesel and solar photovoltaic (PV) power generation. Battery will play a critical role.

• ADB together with Kansai Electric Power (KEPCO) is jointly implementing the grant assistance to develop a model projects comprising a solar power plant, storage system, and system management devices with an existing diesel power plant.

Case 3 : Gujarat Smart Village

Entry/starting points

• The Government of Gujarat (GOG) plans to develop smart village using batteries, solar photovoltaic (PV) power generation and EVs.

• ADB considers financing $500M to GOG including the smart village program using Clean technology Fund.

• ADB will promote private sector participation to the program.

Needs for Alliance of Smart Grid System

• Globally, there is a G-G, and P-P smart grid alliance.

• However, we may need to develop the alliance for smart grid development in Asia in a more practical manner.

• We need to share the best practice on technology, finance, and policy.

Conclusion

• Electricity may only comprise 17 percent of final energy use, at present. Its share to global CO2 emissions, however, is substantial at 40 percent because 70 percent of electricity is generated from fossil-fuel sources. Direct and indirect emissions reductions resulting from the introduction of smart grid are estimated at 0.7 Gt to 2.1 Gt of CO2 net annual emissions reductions by 2050.

• Smart grids can help address energy security, economic development and climate change impact through the intelligent operation of the electricity network.

For More Information

S. Chander (schander@adb.org)

www.adb.org