Prayas Energy Group 1 Electric Power Generation: Supply Side Economics or Demand Side Management Sreekumar N Prayas, Energy Group www.prayaspune.org [email protected] DCIS, Mysore September 18, 2006
Jan 15, 2016
Prayas Energy Group1
Electric Power Generation: Supply Side Economics
or Demand Side Management
Sreekumar N
Prayas, Energy Groupwww.prayaspune.org
DCIS, Mysore
September 18, 2006
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About Prayas Energy Group
Based at Pune, India Research based, policy advocacy NGO Focused on protection of “Public Interest”
– Especially in policy decisions and actions – With a long term sectoral perspective
Activities– Research and intervention (regulatory, policy)– NGO training, awareness, and support
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Interaction Plan
Context: Economy to Energy to Electricity Planning and Integrated Resource Planning Demand Side Management Energy Audit The win - win - win option
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Power Sector
Economy to Energy to Electricity– India is a land of contrasts– Half the population depends on ‘non commercial’
energy– 86% of rural households use firewood/dung cake for
cooking (NSS survey, 2000)– Half the total supply of commercial energy is used for
electricity generation– Per-capita consumption is low, but High Consumption
model will not work– Electricity is a versatile, clean, cost effective energy
Context
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Half the population depends on ‘non commercial’ energy
Half the mankind (3 b) live on < $2/day
One-third have no access to commercial energy
Sub-Saharan Africa, <20% have access to electricity
Poor spend one-third income on energy
Context
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Commercial Energy
Commercial Energy Supply
51%36%
9%
4%
Coal
Oil
Gas
Hydro + Nuclear
Coal
Oil
Gas
Hydro + Nuclear
Context
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Electrical Energy
Electrical Energy Consumption
24%
42%
3%
25%
6%
Agriculture
Industry
Transport
Domestic
Others
Industry
AgricultureDomestic
Others
Transport
Context
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Power System
Context
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Planning
Preparation for tomorrow Based on
– Experiences of Yesterday– Aspirations for Tomorrow
Power sector planning– Generation– Transmission & Distribution– Utilisation– Support systems
IRP
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Planning – Conventional approach
Development
Economic Growth
Energy GDP correlation
Energy as an end
Demand projection
Supply planning
IRP
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Integrated Resource Planning (IRP)
Developed in 1980s Also called Least Cost Planning (LCP) Practised by only few utilities
“ IRP: A planning approach that considers both supply and demand side options to meet the requirement for a resource, while minimising the costs to the utility and society”
IRP
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IRP
Demand projection– Energy service is important, not Energy
Water for irrigation, NOT just electric pumpsets Hot water, NOT just electric heaters Light at work place, NOT just electric lights
– End use efficiency is part of planning Lighting, Motors etc for energy reduction Peak load reduction by Load management
– Development orientation Not just based on growth trends Promotion of agriculture, small industry, rural households
– South Africa household electrification: 40% (1993) to 70% (2003)
IRP
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IRP - Continued
Supply options– Conventional, large centralised– Non-conventional
Small hydro, co-generation
– Environmental sustainability addressed Proper costing of relief & rehabilitation
– DSM as a supply option
Minimise cost to Society, not just to Utility
IRP
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Conventional Planning Vs IRP
Conventional IRP
Supply Side orientation End-use orientation
Demand taken as ‘given’ Policy / DSM to modify demand
Minimises cost to utilityMinimises cost to utility,
consumer and society
Only Centralised, conventional
supply options considered
Decentralised, non-conventional options ALSO considered
IRP
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IRP Case studies from India (Karnataka 1990) – HT End use
12%1%
72%
15%
Electrolysis
Lighting & Cooling
Motors
Process Heating
IRP
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IRP Case studies from India (Karnataka 1990) – Rich Domestic (AV= 200 Units/Month) End use
Lights
Iron
TVRadio
Fan
Refrigerator,
Grinder
Water heater
Other
Cooking
IRP
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IRP Case studies from India (Karnataka 1990) – Poor Domestic (AV= 33 Units/Month) End use
Lights
Iron
TVRadio
Fan
Other
IRP
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IRP Case studies from India - Karnataka
End use efficiency savings– Industry modernisation–efficient drives etc: 15-25%– CFL for lighting : 14-58%– Solar Water heaters: 28%– LPG instead of electric stoves: 18%– Frictionless foot-valves and HDPE piping for
agriculture pumps: 30%
IRP
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IRP Case studies from India
Karnataka 1990– Energy Requirement : 66%– Power Requirement: 50%– Total Cost: 40%
Maharashtra 1994– Energy Requirement : 60%– Power Requirement: 50%– Total Cost: 60%
IRP
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Demand Side Management (DSM)
Planning, Implementation and Evaluation of programs to influence the Amount or Timing of energy usage by consumers
DSM
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DSM Vs SSM
Demand Side Management
Supply Side Management
After the consumer meter Before the consumer meter
- Reduce Power- Reduce Energy- Shift time of use
No reduction in service quality
- Increase generation capacity- Improve generation efficiency- Reduce T&D loss
DSM
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Why DSM?
Peak Shortage (11.7%), Energy Shortage (7.3%)
T&D Loss is proportional to the Square of Current
Incremental generation cost highest during peak load period
Nega Watts cheaper than Mega Watts
DSM
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What is DSM?
Load Management– Reduce Peak Load
– Shift loads from Peak to Off-peak hours
– Increase load during Off-peak hours
Energy Conservation– Energy Audit
– End-use Efficiency improvement
– Energy Management at Consumer location
DSM
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DSM Techniques
Involves Utility, Consumer and Equipment manufacturers
Energy service is the key, not energy itself Ensure same energy service to consumers Direct & Indirect techniques
DSM
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DSM – Energy Conservation: Energy Audit
Analysis of energy input,output and energy usage by different sub-systems over a period of time and giving recommendations to reduce energy use or alter the electric demand profile.
Energy Audit
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Energy Audit
Promoting efficient devices Enforcing energy efficient standards - BEE Distribution Loss reduction (Some include this) Energy Management Awareness Campaigns
Energy Audit
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DSM - Thailand Case
World Bank/UNDP Project 1993 - 2000, US $ 189 Million Residential, Commercial and Industry Sectors
Target ActualMW GWh CO2 -
mTonnesMW GWh CO2 - m
TonnesLighting 139 759 399 1973Refrigerator 27 186 84 849Airconditioner 22 117 84 318Others 50 365 0 0Total 238 1427 1.16 566 3140 2.32
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An SEB Case
DSM Potential: Peak demand reduction of 1543 MW, Energy reduction of 6090 MU in 2001
Cost of DSM for Utility = 3465 Cr Cost of DSM to participants = 1388 Cr
(Jyoti Parikh & Others on MSEB, IGIDR, Mumbai 1994)
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An SEB Case (Cont’d)
DSM Options– Energy Efficient Motors– Variable Speed Drives– House Keeping measures– Use of Waste heat – Improvement of Electric Arc furnaces– TOD Tariff– Sodium Vapour Lamps, CFLs, Electronic Ballasts– Efficient Pumps and Fans– Power Factor Improvement– Industrial Co-generation
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CFL Example
Watts Light -Lumens
Cost Rs Life-Hours
No ofhours/day
Units/Year
Bulb 60 700 10 1000 4 88CFL 15 700 200 7000 4 22
CFL is costly by 3 (not 20) times
Energy bill of CFL is one-fourth
CFL option is 2-3 times economical
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The win-win - win option
Consumer– Lower energy bill– Better power quality
Utility– Saving in Generation, T&D investment– Loss reduction
Society– Better Energy service, faster– Eco friendly
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Barriers for IRP/DSM - Actors
Energy Consumers Equipment manufacturers Energy Producers Energy Distributors Government – policy, standardisation Funding agencies
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Barriers for IRP/DSM
Low awareness– Need more groups like Energy Conservation
Mission (www.save-energy-survive-tomorrow.com)
Bias towards big projects– 100 MW generation plant
Rs. 400 Cr, 1 Project, 1 Site, Few hundred people
– 100 MW saving thru DSM Rs 100 Cr, Few hundred projects, Thousands of locations,
Thousands of people
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Barriers for IRP/DSM
Poor system data availability– Metering for accountability
Lack of focus (planners, utility, manufacturers, consumers, researchers)– High emphasis on load shedding– Absence of Life Cycle Costing approach– Tackling one time cost (eg CFL, efficient pumpsets)– Low correlation of demand to tariff
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Closing word
What can We do?What will they do?
Supply Side or DSM?
Neither, IRP!!