Institution of Engineers Malaysia
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National Energy Policy
The national energy policy has been predicated on the following principles:
� Supply Objective:To ensure provision of adequate, secure and cost-effective energy supplies by
developing indigenous energy resources, both non-renewable & renewable, using least-costs options, & diversifying supply resources within & renewable, using least-costs options, & diversifying supply resources within & outside the economy;
� Utilisation Objective:To promote the efficient utilisation of energy and the elimination of wasteful &
non-productive patterns of energy consumption;
� Environmental Objective:To minimise the negative impacts of energy
production, transportation, conversion, utilisation & consumption on the environment
IEM – EETD AGM
Why Do We Need EE?
1) National Energy Security
2) Individual & National Economic Benefits
3) Conducive Working Environment3) Conducive Working Environment
4) Industrial & Commercial Competitiveness
5) Environmental Benefits for a Cleaner World
6) A Better Life Style &
7) Ensure Sustainability for Our future Generations IEM – EETD AGM
IEM - PPEE
Trend in GDP, Primary Energy Supply and Final Energy Demand
RM million at 2000 prices
ktoe
5
20,000
25,000
30,000
35,000
40,000
Final Energy Use by Sectors
IEM - PPEE
0
5,000
10,000
15,000
Agriculture 0 127 391 62 422 446 472 490 307 106 104 98 96 98 87 101
Non-energy 908 1,071 1,222 2,027 1,817 2,994 1,744 2,298 2,023 1,799 2,250 2,378 2,511 2,345 2,183 2,173
Resid. & Comm. 1,646 1,747 1,891 2,069 2,505 2,837 3,557 3,072 3,314 3,653 3,868 4,048 4,387 4,399 4,754 5,134
Transport 5,387 5,806 6,226 6,558 7,262 7,827 8,951 10,201 9,793 11,393 12,071 13,137 13,442 14,271 15,385 15,340
Industrial 5,276 5,809 6,455 7,012 7,286 8,060 9,443 10,106 10,121 10,277 11,406 11,852 12,854 13,472 14,914 15,536
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Source: National Energy Balance, PTM
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Mtoe/Billion US$ (2000)
Energy Intensity in ASEAN
IEM – EETD AGM
0.0
0.1
0.2
0.3
Brunei 0.036 0.034 0.052 0.112 0.165 0.164 0.158 0.161 0.169 0.167
Indonesia 0.230 0.231 0.350 0.340 0.319 0.431 0.423 0.444 0.429 0.404
Malaysia 0.306 0.247 0.253 0.289 0.303 0.320 0.343 0.338 0.346 0.333
Myanmar 0.493 0.374 0.343 0.209 0.265 0.223 0.183 0.223 0.223 0.222
Philippines 0.215 0.217 0.165 0.169 0.239 0.231 0.225 0.220 0.212 0.206
Singapore 0.122 0.130 0.141 0.156 0.127 0.113 0.133 0.126 0.138 0.141
Thailand 0.267 0.293 0.248 0.272 0.310 0.342 0.358 0.354 0.359 0.352
Vietnam 0.860 0.944 0.396 0.281 0.356 0.382 0.431 0.445 0.527 0.493
1971 1973 1980 1990 1995 2000 2002 2003 2004 2005
Denmark Energy & GDP Data
IEM – EETD AGM
Maximum Demand Growth Alternatives
� Chart 2 – Alternative Demand Growth Scenarios
IEM – EETD AGM
Potential Capital Investment Savings
ComponentYear 2010 2020
Growth reduction from 9% to:
7.8% 6.0% 7.8% 6.0%
Generation plant(RM billion)
4.57 11.05 30.72 68.67
T & D networks(RM billion)
2.15 5.20 14.45 32.32
IEM – EETD AGM
Natural Gas Subsidies - Malaysia
"Gas Subsidy" Sensitivity Calculations
Crude oil price US$/barrel 40.00 60.00 90.00 Crude oil price RM / barrel 152.00 228.00 342.00 Price RM / mmBtu = 27.88 41.83 62.74 Gas price / mmBtu 22.31 33.46 50.19 Gas price RM/mmBtu for power gen Gas price RM/mmBtu for power gen = 6.40 6.40 6.40 Price premium RM / mmBtu = 15.91 27.06 43.79 Hence premium / kWh = 0.1810 0.3079 0.4982
Assumptions: Exchange rate US$ to RM = 3.8 Gas price = 80% of oil price 1 mmBtu = 1.055 GJ 1 barrel = 5.75 GJ = 5.451 mmBtu = 0.479 MWh 1 MWh = 11.377 mmBtu at conversion efficiency of 30%
IEM – EETD AGM
Electricity Demand Projections and 9MP Targets for EE
Demand Savings with EE (Elasticity 1.5 to 1.3)
35,000
40,000
45,000
50,000
MW
Dem
and
Elasticity 1.5Demand growth BAU
-
5,000
10,000
15,000
20,000
25,000
30,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year
MW
Dem
and
Reduction of 833 MW (2010)
Demand growth EEElasticity 1.3
IEM – EETD AGM
Potential Savings from EE Initiatives: 2007 – 2010
Capital Investment & Energy Use Savings(Based on Demand Reduction of 833 MW)
Capital Investment Savings (Gen) 4,163 RM (bn)
Capital Investment Savings (T & D) 1,665 RM (bn)
Energy Use Reduction 2007 to 2010 (at RM Energy Use Reduction 2007 to 2010 (at RM 0.25/kWh) 2,694 RM (b
(Consumer Energy Cost Savings)
Total Savings fro 2007 to 2010 8,523 RM (bn)
Gas Subsidy Savings (at RM 0.20/kWh) 2,156 RM (bn)
Carbon Dioxide Emission Reductions 6,586 Tn (m)
IEM – EETD AGM
IEM – EETD AGM
Main Aspects of Supply Side EE:
� Primary energy use efficiency,
� Co-generation & its impacts,
� Power plant conversion efficiency,
IEM – EETD AGM
� Power plant conversion efficiency,
� Auxiliary energy use,
� Plant capacity factors,
� T&D loss trends & IBRD “target”,
� Distribution transformer capacity management,
� Benefits of EE in Thailand.
Primary Energy Conversion Efficiency
Energy Conversion Efficiency is:
Energy output / Primary Energy input.
Energy Conversion Efficiency depends on the
energy conversion mode, and is typically:
12 Dec 2003 CICM – MOMG Training Programme
energy conversion mode, and is typically:� Co-Generation / CHP - up to 85%
� Combined cycle plant - up to 55%
� Conventional steam plant - 35% - 40%
� Open Cycle Gas Turbines - about 30%� (Existing Oil Palm Mills - as low as 3%)
TNB Sells Electricity generated from diverse fuels.
Petronas Sells natural gas, which powers about
70% of electricity generated in Malaysia
Utility Use of Natural Gas
12 Dec 2003
Industrial & Commercial customers need electricity
& “thermal energy” (heating or cooling)
“Inefficient” use of gas (avoiding co-gen) wastes
national fuel & financial resourcesCICM – MOMG Training Programme
TNB is willing to:
� Purchase surplus power from SREP co-gen plant
� Ready to provide “standby” and “top-up” power to co-gen
facilities for electricity supply adequacy & security
� Willing to purchase surplus power from other co-gen
Utility Stand on Co-generation
12 Dec 2003
� Willing to purchase surplus power from other co-gen
plant but at rates lower than SREP rates
TNB proposes that the government should subsidise purchase
price of surplus co-gen electricity, beyond TNB’s “avoided cost
of generation”
CICM – MOMG Training Programme
Assume co-gen energy conversion efficiency of, say
70%
Assume combined cycle conversion efficiency of,
say 40%
Benefits of Co-generation
12 Dec 2003
say 40%
Efficiency increase with co-gen becomes 75%
If only 20% of current gas use is converted to co-
gen, then the efficiency of gas use improves by
about 15%.
CICM – MOMG Training Programme
Co-generation “Cost Penalties”
Use of natural gas in co-generation form faces several hurdles such as:
� High “Top-Up and Stand-By Charges” for TNB supply from the utility grid,
� TNB’s refusal to accept excess electricity generation from Co-TNB’s refusal to accept excess electricity generation from Co-Gen plant except at very low purchase price,
� Recent unavailability of gas for industrial use,
� Note:� FMM has mentioned that TNB imposes “punitive charges” on its Co-Gen
customers who exceed their “Declared Demand” or “Average load Factor” (No concrete evidence provided)
IEM – EETD AGM
Efficient Use of Natural Gas
� TNB revenue (for 2007) RM 23 billion
� Assuming fuel cost (including by IPP) is about 35% - RM 8.05 billion
� About 65% of total electricity generation is from gas - RM 5.23 billion
� Assuming 20% of NG is used for co-generation, with efficiency improvement from 40% to 75%, the NG saving would be 15%, (20% of 75% improvement) which amounts to RM 1.05 billion a year.
� Sale of RM 1.05 billion worth of NG (at RM 6.40 per mmBtu) to the export market (at say, even RM 24 mmBtu), would generate additional revenue of about RM 3.9 billion, or make available additional gas supplies for industrial use.
IEM – EETD AGM
Other Benefits of Co-generation
Lower primary energy consumption,
So less emissions,
Higher thermal efficiency of conversion
So lower energy intensity.
12 Dec 2003
So lower energy intensity.
Distributed generation
So less need for large power generation,
Less need for T & D infrastructure development, and
Reduced T & D losses
CICM – MOMG Training Programme
Italy
The Netherlands
Portugal
Spain
Sw eden
UK
EU Average
CHP as a share of national power production - 1999
12 Dec 2003CICM – MOMG Training Programme
0 10 20 30 40 50 60
Austria
Belgium
Denmark
Finland
France
Germany
Greece
Ireland
From Cogen3 presentation Oct 2003
The Netherlands
Portugal
Spain
Sw eden
UK
EU Average
CHP as a share of national power production - 1999 & 2010 (??)
12 Dec 2003CICM – MOMG Training Programme
0 10 20 30 40 50 60
Austria
Belgium
Denmark
Finland
France
Germany
Greece
Ireland
Italy
From Cogen3 presentation Oct 2003
Production share of electricity by CHP
15%
20%
25%
Present Policies
Heightened Environmental Awareness
Post Kyoto
Deregulated Liberalisation Target (18%)
12 Dec 2003
0%
5%
10%
2000 2005 2010 2015 2020
From Cogen3 presentation Oct 2003
CICM – MOMG Training Programme
Power Plant Conversion Efficiency Index
60
70
80
90
100Design Eff'cy
Actual Eff'cy
Efficiency Index
Relative Efficiency Index
IEM – EETD AGM
0
10
20
30
40
50
Palnt A Palnt B Palnt C Palnt D Palnt E Palnt F Palnt G
Power Plant Auxiliary Use?
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Self Use Energy - % of Generated energy
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Power Plant Capacity Factors
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Capacity Factors
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Loss Reduction Trend - Sample
20.00
25.00
30.00
35.00 Trans Loss
Distn loss
T & D loss
Loss Trends S. Korea
Loss
%
IEM – EETD AGM
-
5.00
10.00
15.00
20.00
Loss
%
Year
Utility Losses (T & D)
20.0%
25.0%
30.0%
% L
osse
s
Utility Losses Malaysia Losses TNBLosses SESBLosses SEB (SESCO)
0.0%
5.0%
10.0%
15.0%
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
% L
osse
s
Year
IBRD Recommended T & D Loss Target (1982)
IEM – EETD AGM
Electricity Utility Transmission and Distribution Losses
I.B.R.D. Energy Efficiency : Optimisation Of Electric Power Distribution System Losses (1982).
Target Acceptable
Transmission 2.0 4.0 }
xx December 2004
Transmission 2.0 4.0 }Sub-transmission 2.0 4.0 } 4.0
Distribution H.V. 3.25 5.5 }Distribution L.V. 1.0 2.0 } 8.0
Total 8.25 15.5 12.0
Distribution Substations & MD
40,000
50,000
60,000
70,000
TNB Substation data
No. Of Substations
Substation capacity MVA
MD - MW
-
10,000
20,000
30,000
40,000
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
No.
& M
VA
Years
IEM – EETD AGM
4,000
5,000
6,000
SESB Substation data
No. Of Substations
Substation capacity MVA
MD - MW
Distribution Substations & MD
IEM – EETD AGM
-
1,000
2,000
3,000
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
No.
& M
VA
Years
Distribution Substations & MD
6000
7000
8000
9000
SEB Substation data
No. Of Substations
MVA+Sheet1!$84:$84 capacity
MD MW
IEM – EETD AGM
0
1000
2000
3000
4000
5000
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
No.
& M
VA
Years
Target and Actual Savings EGAT’s DSM Programmes
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Results of 30% Subsidy Programme
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Results of Energy Efficiency Revolving Fund
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Measures Implemented in EE Revolving Fund
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Cost Effectiveness Indicators for EGAT’s DSM Programs
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Past and Future DSM Plans
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IEM – EETD AGM
Savings from Designated Facilities
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IEM – EETD AGM
IEM – EETD AGM
G. Lalchand G. Lalchand G. Lalchand G. Lalchand EEEE----mail:mail:mail:mail:[email protected]@[email protected]@mbipv.net.my
IEM – EETD AGM
IEM - PPEE