Opportunities for RE Market Development in Ghana

Opportunities for RE Market
Development in Ghana
Steffen Behrle
Team Leader, Renewable Energy, GIZ Ghana
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Content
1. GIZ Programme Capacity for a Successful Implementation of the RE
Act (C-SIREA)
2. Energy Situation in Ghana
3. Options for RE Market Development
a. Utility-scale RE
b. Hybridisation of Thermal Power Plants
c. Distributed RE Generation
d. RE Purchase Obligation for Bulk Customers
e. Mini-Grid and Off-Grid RE
4. Conclusions
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MINISTRY OF ENERGY
AND PETROLEUM
Joint Programme
Capacity for a Successful Implementation of the Renewable
Energy Act (C-SIREA)
• Objective: Improving the planning, technical, and institutional
capacities in relevant institutions for a successful
implementation of the Renewable Energy Act
• Areas of intervention:
• RE Implementation Strategy for Ghana as a building block for a RE
Master Plan
• Legislative Instruments
• RE Potential and Scenarios, RE Market Potentials
• Capacity Development for Decision-Makers
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MINISTRY OF ENERGY
AND PETROLEUM
C-SIREA Steering Committee
Lead agency
Implementing Agencies
Members of Steering Committee
MINISTRY OF
ENERGY AND
PETROLEUM
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Capacity for Implementing the RE Act in Ghana
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MINISTRY OF ENERGY
AND PETROLEUM
Joint Programme C-SIREA
Tasks for Grid-Connected RE
•
Assess RE potential - costs, performance, and potential quantities of
key RE resources and develop RE scenarios (costs/benefits)
•
Develop RE Purchase Obligations
•
Develop RE Tendering Rules and Procedures
•
Further develop Licencing Manual into Licencing Regime (->
Legislative Instrument) and draft Net-Metering Code
•
Further develop standard RE Power Purchase Agreements
•
Develop Funding Strategies and Operating Manual and Tools for RE
Fund
•
Grid impact /stability analysis for intermittent RE and review draft
‘RE Grid Code’
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Energy Situation – Generation at Margin
• Total installed capacity at 2,550 MW (1445 MW or 56% is large hydro)
• Annual increase in electricity demand over past 10 years = 6.6%, over
past 5 years = 9.2%, projected annual growth btw 2013-2025 = 7.5%
• Current demand and supply do not leave margin
• Additional base-load capacity required by 2020: estimated at about
2,500 MW (Gov‘t advanced target to 2016)
• Peak electricity demand in the evening after dark
• 10 percent RE target by 2020 (= 500 MW)
• Feed-in tariffs announced in Sept 2013
• RE tendering rules, purchase onbligation, capacity caps for solar and
wind, net-metering code to be announced in first half of 2014
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GWh
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Source: VRA
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Options for RE market development
Option 1: Utility-scale RE (solar, wind, hydro)
Option 2: Hybridisation of existing and new thermal power plants with
solar PV or wind allowing for base-load and flexible capacity
Option 3: Distributed RE generation via net-metering for non-residential
customers
Option 4: Bulk customer’s own generation to fulfil RE purchase
obligation
Option 5: Mini-grid and off-grid RE
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Option 1: Utility-scale solar PV
• Government-driven development via VRA:
• 2.8 MW installed in 2013 (tender won by China Wind Power)
• Additional 12 MW to be developed by 2015/2016
• Several PPAs have been signed between ECG and private project
developers before FiT was announcement
• Licencing and siting for project developers
• 20 provisional licences issued for solar PV (up to 1000 MW capacity)
• 3-5 siting clearances
• FiT Guidelines will announce caps for solar and wind as well as a first
tender for solar PV for holders of provisional licences and siting
clearance
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Option 1: Utility-scale solar PV (con‘t)
• Grid integration/stability studies will show capacity for integrating
intermittent RE
• Capacity will remain low as long as
• generation is at margin and any larger additional capacity needs to
be firm,
• virtually no back-up capacity exists, and
• peak demand remains after dark
• How high or low non-disruptive integration is possible and at which cost
remains the crucial question that we want to analyse
limited short-term opportunities for new market entrants
competition driven by price of systems; technology cap may limit
scope to 3-4 smaller bidding rounds
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2500
0.6
Sunon Asogli
0.5
2000
Tema Mine Reserve Plant
TEMA TT2PP
0.4
1500
Aboadze T2
MW
Tema TT1PP
0.3
OSONOR (CENIT)
Aboadze T1
1000
0.2
Tokaradi 3
BUI
500
0.1
Kpong
Akosombo
0
0
Demand
Solar PV Capacity Factor
Generation Capacity Stack Ordered by SRMC Compared to Solar PV Load
Sources: Electricity Company of Ghana (ECG), PURC
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Option 2: Hybridisation of thermal power plants
NEW IDEA
• Save fuel costs by integrating solar PV in exisiting or planned
• gas-fired power plants
• oil-fired power plants
• coal-fired power plants
• Model plants could be CSP integrated in gas-fired power plants in
Egypt and Algeria
More information, ideas and examples are most welcome!
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Option 3: Distributed generation
• Net metering will allow utility customers to generate electricity for own
consumption and sell access electricity to the utility up to the level of the
annual consumption (at retail or FiT-rate or avoided cost)
• Real opportunity NOW for high-consuming non-residetial
customers (601+kWh per month) because of
•
Ghana‘s tariff structure
•
the recent tariff increase of 78% (as of 1 October 2013)
• This customer category contains larger office buildings e.g. of banks,
supermarkets, hotels (between 5,000 and 10,000 customers)
• Incentive to lower electricity costs at US$ 0.35 per kWh even in the
absence of effective net-metering regulation
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Mines-HV
SLT-HV
SLT- MV
SLT- LV
Non-Residential 601+ kWh
Non-Residential 301-600 kWh
Non-Residential 101-300 kWh
Non-Residential 0-100 kWh
Residential 601+ kWh
Residential 301-600 kWh
Residential 151-300 KWh
Residential 51-150 kWh
Residential 0-50 kWh
Comm. Scale
Solar PV
Solar
FIT
Res.
Scale
Solar
PV
0.00 0.05 0.10 0.15 0.20 0.25 0.30 0.35 0.40
USD/kWh
2013 Electricity Tariffs Compared with LRMC of Solar PV
Sources: PURC for Solar FIT and tariffs; data collected from solar developers in Ghana for
residential and commercial scale solar PV systems.
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Option 4: RE Purchase Obligation for Bulk Customers
• A RE purchase obligation is being developed for the distribution utilities
(ECG, NEDCo) and bulk customers (mining companies, cement
producers etc.)
• One newly discussed feature: allow bulk customers to generate RE for
own consumption at their premises as accountable towards their RE
purchase obligation.
• This would make investment e.g. by mining companies in their own
solar PV generation more attractive if
• the cost of purchasing electricity from RE on the market is high
enough
• RE certificates are expensive enough
• The penalty for not fulfilling the obligation is high enough and being
enforced.
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Option 5: Mini-grid and off-grid RE
• Very important option for Ghana‘s social development
• Very limited market potential for off-grid solutions in the absence of
significant subsidy levels
• Gov‘t successfully runs solar lantern distribution programme
• RE technologies for increasing the productive use of electricity e.g.
in irrigation (solar and wind pumps) and agro-processing (solar
drying, solar PV for grinding, milling, de-husking) -> will be the focus
of several development partners in the sector under SE4All
• Improved cook stove programmes run by NGOs
• Diesel-solar hybrid mini-grids will be piloted and operating models
tested. The uniform tariff policy (lowest residential tariff at US$0.07)
leaves little room for non-subsidised and profitable business
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Conclusions
Opportunities for RE market development in the short- to-medium term are
in:
- Distributed generation via non-residential consumers such as banks,
hotels, supermarkets
- Bulk customers such as mines and cement factories to build solar PV
on their own premises as attributable to their RE purchase obligation
These customers have the means to invest or access to finance and can
be the pioneers to spearhead the development of the RE markets.
In parallel, a few investors and the Government itself will develop some
limited capacity (up to 100 MW) in utility-scale solar PV in the coming 5-10
years. In the longer term, large-scale solar will become more relevant.
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Thank you very much for your kind attention!
Steffen Behrle
Team Leader, Renewable Energy
GIZ Accra
[email protected]
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