Power sector policies and regulations, and future plans Vilaysone SOURIGNA Department of Energy Promotion and Development Ministry of Energy and Mines.

Power sector policies and regulations, and future plans

Vilaysone SOURIGNADepartment of Energy Promotion and

Development

Ministry of Energy and Mines

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Topic of Presentation

Background Power Sector Policy Institutional Structure Challenges/ Priority

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Brief Economic Data Area of 236,800 sq km; 16 Provinces + Capital and 139

districts; Population of 6.48 mio. (7/2011

est.); GDP of USD 6.4 billion (2010); GDP Growth 7.7% GDP per Capita of USD 984

(2010); Hydropower potential ~ 23,000

MW Existing installed capacity of ~

2560 MW (11%) Produced energy of 11,890

GWh/Y Produced energy per capita of

1,835 kWh/Y Exported energy per capita of

1510 kWh/Y

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Power sector policy1. Maintain and expand an affordable,

reliable and sustainable electricity supply to sustain economic growth and poverty alleviation

2. Promote power generation for export to provide revenues

3. Develop and enhance the legal and regulatory framework to effectively direct and facilitate power sector development

4. Reform institutions and institutional structures to clarify responsibilities, strengthen commercial functions and streamline administration

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HISTORY OF POWER SECTOR DEVELOPMENT

Since 1990, the Power sector was opened to private foreign direct investments;

Memorandum of Understanding on the power cooperation program was signed with the Royal Thai Government in 1996 and 2006 under which 3,000 MW is to be supplied to Thailand and subsequently increased to 7,000 MW was agreed and have the intention to increase to 8,000 MW;

In 1998 and 2006 MOUs were signed with the Government of Vietnam for 3000 MW and subsequently 5000 MW was agreed;

In 1999 Agreement on Cooperation in Power Sector was signed with Cambodia and in 2010 Cambodia agree to import electricity from Laos 300 to 400 MW by 2015;

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Current Institutional Structure of Lao Power Sector

PRIME MINISTER OFFICE (PMO)

- Dept of electricity (DOE)

- Dept. of Energy Promotion & Dev. (EPD)

Ministry of Energy and

Mines (MEM)

IPP company for

export

Electrical Construction & Installation Co.

(ECI)

IPP company for

national supply

Lao State Holding

Enterprise (LSHE)

Ministry of Finance (MOF)

Ministry of Natural Resources and Environment

(MNRE)

Ministry of Planning and

Investment (MPI)

Electricité du Laos (EDL)

- Transmission

- Distribution

Prov. Electric Supply Co.

(PESCO) for off-grid area

EDL –Generation

(Public)

Power grid construction

company

Design & Engineering

company

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Current Operating Structure of the Power Sector

Electricité du Laos (EDL)

Non-integrated Transmission System (230kV and 115kV) (North/Central - South)

Distribution (~75% of total households)

Single Buyer and Retail

Domestic IPP in 2011

Power sales to Cambodia (EDC)

IPP projects with export to Thailand since

1998

Privately owned transmission

facilities through dedicated

section

EVN

IPP projects with export to Vietnam by

2012

Large consumers

EGAT

Lao State Holding Enterprise (LSHE) <NT2,HSA, NN3, NNGP1, XPXN, SK4, SK5, NK1,

NT1>

Power Exchange with EGAT and PEA

EDL- GEN (public)

Subsidiary of EDL, own & operate

387 MW of hydropower

Import Power from EVN and China

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Challenges/Priority

Challenges:- Restructuring of the Power Industry- Manpower capacity building Priority:- Establishment of Power grid Co. as TSO- Improvement of Performance Standard- Improvement of the Legal Frameworks- Setting up of Independent Power Regulator

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Proposed Institutional Structure at Policy Level

PRIME MINISTER OFFICE (PMO)

- Dept. of Electricity (DOE)

- Dept. of Energy Promotion & Dev. (EPD)

Ministry of Energy and

Mines (MEM)

Ministry of Finance (MOF)

Ministry of Natural Resources and Environment

(MONRE)

Ministry of Planning and

Investment (MPI)

- Dept. of Energy Policy and Planning (EPP)

- Dept. of Energy Regulatory (DER)

- Dept. of Energy Business (DEB)

- Institute for Renewable Energy Promotion (IREP)

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Regional Interconnections for future Power Trading

1. Nabong (Laos) - Udon3 (Thailand)

2. Ban Hatsan (Laos) – Pleiku (Vietnam) 3. Pakse (Laos) - Ubol2 (Thailand)

4. Hongsa (Laos) – Mea Moh (Thailand)

5. Pakmong (Laos) - Yunnan (China)

6. Luangphabang (Laos) - Northern Vietnam

7. Xayabouli (Laos) – Khon Ken (Thailand)

8. BanHat (Laos)- StungStreng (Cambodia)

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Establishment of Power Grid Co. as TSO

Modality:- 100% state owned- Joint-venture (Private Public Partnership)- BOT Priority:- High credibility for operation- Financially trustworthy- Transparent, Non-discriminatory to all

customers- Long term investment

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Thank you for your kind Attention

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