Energy Planning, Energy Planning, Methodology and Methodology and Approaches: Approaches: Jamaica’s Experience Jamaica’s Experience “ “ Latin American and Caribbean Latin American and Caribbean Energy Forecast – Energy Energy Forecast – Energy Scenarios at 2032” Scenarios at 2032” OLADE Sub-regional Workshop OLADE Sub-regional Workshop February 19, 2009 February 19, 2009 Conroy Watson Conroy Watson Senior Director Senior Director Ministry of Energy, Jamaica Ministry of Energy, Jamaica
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Energy Planning, Methodology and Approaches: Jamaica’s Experience “Latin American and Caribbean Energy Forecast – Energy Scenarios at 2032” OLADE Sub-regional.
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Energy Planning, Energy Planning, Methodology and Methodology and
““Latin American and Caribbean Latin American and Caribbean Energy Forecast – Energy Energy Forecast – Energy
Scenarios at 2032”Scenarios at 2032”OLADE Sub-regional WorkshopOLADE Sub-regional Workshop
February 19, 2009February 19, 2009
Conroy WatsonConroy WatsonSenior DirectorSenior Director
Ministry of Energy, JamaicaMinistry of Energy, Jamaica
February 2009 Ministry of Energy, Jamaica, W.I. 2
OutlineOutline
• Introduction• World Oil Market• Jamaica’s Energy Profile• Market Structure• Petroleum Market• Electricity Sector• Energy Modeling, Planning & Policy Guidelines• Energy Conservation and Efficiency• Way Forward• Concluding Remarks
February 2009 Ministry of Energy, Jamaica, W.I. 3
IntroductionIntroduction
• Jamaica is an oil importing developing country
• Petroleum imports satisfy more than 90% of the country’s energy needs
• Highly susceptible to global market conditions
February 2009 Ministry of Energy, Jamaica, W.I. 4
World Oil MarketWorld Oil Market
• Influences on global economy– Emerging markets (China, India)– Reserves
• Rate of new discoveries– Volatility of oil prices
• Market speculation• Geopolitical developments• Changes in production strategies• Uncertainty in supplies
• Crude and product prices– Crude prices traded at US$147/bls in 2008
• Averaged US$99.67/bls– Price decline started at the end of 2008– False sense of security
February 2009 Ministry of Energy, Jamaica, W.I. 5
SUPPLYSUPPLY REFINERYREFINERYSECTORALSECTORAL
CONSUMPTIONCONSUMPTIONEND-USEEND-USE
DEMANDDEMAND
VENEZUELA
MEXICO
ECUADOR
NIGERIA
T & T
OPEN MARKET
VENEZUELA
MEXICO
ECUADOR
NIGERIA
T & T
OPEN MARKET
JAMAICAJAMAICA
AGRIAGRI
BAUXITE / BAUXITE / ALUMINAALUMINA
ELECTRICITYELECTRICITY
MANUFACTUREMANUFACTURE
PUBLIC SERVICEPUBLIC SERVICE
RESIDENTIALRESIDENTIAL
TOURISMTOURISM
TRANSPORTTRANSPORT
DISTRIBUTEDISTRIBUTE
DIST.DIST.
LIGHTINGLIGHTING
HEATINGHEATING
COOKINGCOOKING
REFRIGERATEREFRIGERATE
A/CA/C
MOTOR / MOTOR / ENGINE ENGINE POWERPOWER
STEAMSTEAM
STORE&
REFINE
STORE&
REFINE
Jamaica’s Energy ProfileJamaica’s Energy Profile
February 2009 Ministry of Energy, Jamaica, W.I. 6
Market StructureMarket Structure• Petroleum
– Liberalized petroleum market– State owned refinery– 10 marketing companies
• 1 state owned marketing company• 3 multinationals• 6 Local marketing companies (private)
– Approx. 300 service stations island-wide
• Electricity– Largest supplier: JPS– Electricity generation is done competitively– Single distributor– Three Independent Power Producers– Other producers
• Bauxite/Alumina companies• Caribbean Cement Company Ltd• Sugar Factories
Petroleum MarketPetroleum MarketDrill & Process
Distribution
Bauxite & Mining
Electricity Generation
Transportation
February 2009 Ministry of Energy, Jamaica, W.I. 8
Imports and ConsumptionImports and Consumption
2006 2007 2008** 2010** 2020**
Oil import bill (US$ million)
1,838 2,0082,700…
2,9002,100 3,300
Oil imports (million bls)
31 30 28 to 29 30 33
Total Energy Consumption (million boe)
28 28 26 27 28 ...32
** Assumptions for projections: (1) conservation and efficiency efforts successful and continuous (2) alternative energy projects developed (ethanol, wind, bio-diesel, coal, CNG, Petcoke) (3) oil price 2010: US$70/bls (4) oil price 2020: US$100/bls
February 2009 Ministry of Energy, Jamaica, W.I. 9
Sectoral ConsumptionSectoral Consumption
Electricity SectorElectricity Sector
Transmission
Generation = JPS + IPPS
DistributionTransmission
Generation = JPS + IPPS
Distribution
February 2009 Ministry of Energy, Jamaica, W.I. 11
Net Generation TrendsNet Generation Trends
2006 2007 2008 2010** 2020**
Net Generation (‘000 MWh)
4,043 4,079 4,133 4,270 5,340
Losses (% of net) 23 22 24 20 18
IPP Grid Contribution (%)
33 31 30 30 30
Renewable Energy Grid Contribution (%)
5 5 5 ** 10 15
Note: ** Projections guided by trends and Acres ReportSource: JPS and Acres Management Consulting
February 2009 Ministry of Energy, Jamaica, W.I. 12
Electricity Sector PrioritiesElectricity Sector Priorities• Sector monitored by the regulator (O.U.R.)
– JPS compliance– Recommendations from All Island Black-out Studies– Established standards and directives from the regulator.– Implementation of National Integrated Electricity
Expansion Plan and Efficiency Study for Jamaica (Acres Report)
– Least Cost Expansion Plan– Tariff reviews for electricity rates– Electricity License
• Electricity Supply Strategy & Planning including renewable energy
• Examine impact of energy efficiency and conservation
February 2009 Ministry of Energy, Jamaica, W.I. 13
• Generation– Establish and implement a programme to
monitor the efficiency of power generating units
– Fuel use and power generation
• Transmission• Distribution• Assess Infrastructure Performance• Merit Order Dispatch• Shifts in peak demand
Energy Modeling,Energy Modeling, Planning Planning
and and Policy Guidelines Policy Guidelines
February 2009 Ministry of Energy, Jamaica, W.I. 15
MODELING
MODELING
LEGISLATIVE FRAMEWORK
LEGISLATIVE FRAMEWORK
POLICYPOLICY
Supporting Structures
ENERGY
E = MC2
February 2009 Ministry of Energy, Jamaica, W.I. 16
Energy Policy (Green Paper)Energy Policy (Green Paper)• Elements of Energy Green Paper 2006 – 2020
– Energy supply and security – Petroleum Industry– Electricity Sector– Rural Electrification Programme– Transportation Sector– Development of Renewable Energy Resources– Energy Conservation and Efficiency– Energy Fund– Institutional Arrangement
• Green Paper addenda– Energy Conservation and Efficiency Policy: 2008-2022– Bio-fuels Policy
February 2009 Ministry of Energy, Jamaica, W.I. 22
Jamaica Energy NetworkJamaica Energy Network
A complete energy network for a country or region may consist of a large number of sectoral energy networks. Jamaica’s network topology includes various sectors*:
*The Ministry established an “ENPEP Working Committee” to modify the existing network and present a network topology that is highly reflective of existing energy systems.
• Bauxite Industry• Domestic Energy Market• Residential Consumers
February 2009 Ministry of Energy, Jamaica, W.I. 23
Electricity NetworkElectricity Network
February 2009 Ministry of Energy, Jamaica, W.I. 24
Sugar Industry NetworkSugar Industry Network
February 2009 Ministry of Energy, Jamaica, W.I. 25
Refinery NetworkRefinery Network
February 2009 Ministry of Energy, Jamaica, W.I. 26
Limitations of the ModelLimitations of the Model• Solution generated year-by-year and is said to be
“myopic”, which for short term oriented energy market may actually be an advantage.
• Demand-driven
• Not set up with sufficient detail
• Can be insensitive to price
• Ease of use in the Windows interface conceals the sub-models.
“ENPEP-Balance is a tool – and a tool should be used wisely”
February 2009 Ministry of Energy, Jamaica, W.I. 27
ENPEP SummaryENPEP Summary• Framework for developing institutional capacity
– government and non-government organizations– agencies
• Model is adaptable and can be viewed as a planning tool– developing the country’s long-run energy strategy– generating scenarios according to user specifications– necessary to informing policy decisions.
• Jamaica’s case study created an appropriate energy network– Analyses both energy and environmental systems
Energy ConservationEnergy Conservation and Efficiency and Efficiency
Projects and Activities
February 2009 Ministry of Energy, Jamaica, W.I. 29
HotelsHotels
• Energy audits
• Lighting efficiency improvement
• A/C efficiency improvement • Steam system efficiency
improvement• Power factor correction• Solar water heater installation
IndustryIndustry
• Use of cogeneration systems• Use of high efficiency electric
motors and variable speed drives
• Power factor correction• Use of high efficiency industrial
lamps• Steam system efficiency
improvement
Public SectorPublic Sector
• Energy audits• Implementation of energy
efficiency measures in hospitals and schools
• NWC (approx. 50% of the public sector consumption)– Installation of energy
efficient pumps– Power factor correction
February 2009 Ministry of Energy, Jamaica, W.I. 30
Projects and Activities cont’dProjects and Activities cont’d
• Energy conservation programmes
• Public education programmes– Turning off lights when not in