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    Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code
    Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code
    Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code
    Ebook257 pages2 hours

    Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code

    By Asian Development Bank

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    About this ebook

    This report explains the complex challenges facing the six countries in the renewables-rich Greater Mekong Subregion (GMS) as they work to implement a comprehensive framework to enable regional electricity power trading. Against the backdrop of energy market volatility, it details how ADB is helping high-voltage electricity network operators reach a deal on interconnections which could unlock extensive economic benefits for each GMS country. Acknowledging a transparent power-sharing regime is still some way off, it provides a road map to help countries overcome infrastructural challenges and political concerns to build a fully synchronized GMS transmission network.
    LanguageEnglish
    PublisherAsian Development Bank
    Release dateDec 1, 2022
    ISBN9789292696658
    Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code

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      Book preview

      Facilitating Power Trade in the Greater Mekong Subregion - Asian Development Bank

      FACILITATING POWER TRADE IN THE GREATER MEKONG SUBREGION

      ESTABLISHING AND IMPLEMENTING A REGIONAL GRID CODE

      DECEMBER 2022

      Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO)

      © 2022 Asian Development Bank

      6 ADB Avenue, Mandaluyong City, 1550 Metro Manila, Philippines

      Tel +63 2 8632 4444; Fax +63 2 8636 2444

      www.adb.org

      Some rights reserved. Published in 2022.

      ISBN 978-92-9269-664-1 (print); 978-92-9269-665-8 (electronic); 978-92-9269-666-5 (ebook)

      Publication Stock No. TCS220569

      DOI: http://dx.doi.org/10.22617/TCS220569

      The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent.

      ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by ADB in preference to others of a similar nature that are not mentioned.

      By making any designation of or reference to a particular territory or geographic area, or by using the term country in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area.

      This work is available under the Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO) https://creativecommons.org/licenses/by/3.0/igo/. By using the content of this publication, you agree to be bound by the terms of this license. For attribution, translations, adaptations, and permissions, please read the provisions and terms of use at https://www.adb.org/terms-use#openaccess.

      This CC license does not apply to non-ADB copyright materials in this publication. If the material is attributed to another source, please contact the copyright owner or publisher of that source for permission to reproduce it. ADB cannot be held liable for any claims that arise as a result of your use of the material.

      Please contact pubsmarketing@adb.org if you have questions or comments with respect to content, or if you wish to obtain copyright permission for your intended use that does not fall within these terms, or for permission to use the ADB logo.

      Corrigenda to ADB publications may be found at http://www.adb.org/publications/corrigenda.

      Notes:

      In this publication, $ refers to United States dollars.

      ADB recognizes China as the People’s Republic of China, Laos as the Lao People’s Democratic Republic, and Vietnam as Viet Nam.

      Cover design by Daniel Feary.

      Contents

      Tables, Figures, and Map

      Foreword

      Over the past decade, the Greater Mekong Subregion (GMS) Regional Power Trade Coordination Committee (RPTCC) has made significant progress in deepening cooperation among its members to scale up power trade. The RPTCC has taken steps to harmonize power sector regulations, technical performance standards, and grid codes. It has been a privilege for the Asian Development Bank (ADB) to support this work to help GMS members reap the benefits from more optimized use of diverse energy resources across the region.

      This report reflects a 5-year endeavor among government officials and representatives from utilities with the support of international experts to reach an agreement on a range of complex technical and institutional issues in establishing a common Regional Grid Code (RGC) for the GMS. Power planning studies have confirmed that significant savings can be achieved, particularly through reserve sharing, load shifting, and joint use of variable renewable energy and hydropower resources. The report addresses the technical and operational issues of interconnections along with the steps that are required to harmonize national grid codes within an overarching regional structure of the RGC. The development of the proposed RGC considered experiences from global power markets and worldwide advancement in high and super-high voltage transmission technologies and reflected the specific power utility development conditions and stakeholder interests of GMS members.

      In 2020, ADB published Harmonizing Power Systems in the Greater Mekong Subregion: Regulatory and Pricing Measures to Facilitate Power Trade in hopes of fostering and encouraging cross-border power trade. This new report on Facilitating Power Trade in the Greater Mekong Subregion: Establishing and Implementing a Regional Grid Code follows through the progress made over the years. Both reports present a comprehensive set of rules, standards, and techniques to help enhance cooperation. The findings presented in these studies are particularly relevant to government ministry planning departments, regulatory bodies, power utilities, and potential private sector investors that play a critical role in expanding power trade within the GMS.

      We share an increasingly uncertain outlook in the energy market with the impact of high and volatile fuel prices. The GMS region is endowed with large volumes of renewable resources that can enhance the region’s energy security. We hope that a future harmonized grid can enable the transition toward clean energy, and benefit our communities with reliable, affordable, and sustainable electricity services.

      Ramesh Subramaniam

      Director General

      Southeast Asia Department

      Abbreviations

      Executive Summary

      The Greater Mekong Subregion (GMS) comprises six politico-economically disparate countries, i.e., Cambodia, the Lao People’s Democratic Republic (Lao PDR), Myanmar, Thailand, and Viet Nam, which are members of the Association of Southeast Asian Nations (ASEAN), along with the Guangxi Zhuang Autonomous Region and Yunnan Province of the People’s Republic of China (PRC). The GMS is one of a dozen groups of countries around the world grappling with the issues of how to foster regional electricity power trading in the rapidly changing energy sector. In most countries, power sector institutions have been traditionally self-sufficient and largely focused on maintaining secure and reliable national power networks in the absence of a competitive power market. In its capacity as the GMS Secretariat, the Asian Development Bank (ADB) has been supporting several sectors of the region’s economic development since 1992. It is recognized by its development partners as the lead agency in coordinating technical, financial, and institutional support for developing an open access transparent power trading regime within the GMS.

      This report explains ADB’s supporting role in coordinating and encouraging the GMS Transmission System Operators (TSO), who manage the respective national electricity high voltage networks, to establish the Regional Power Trade Coordinating Committee (RPTCC) and implement an agreed Road Map for grid-to-grid power trading to start after 2022. Under the first stage of the Road Map, the TSOs agreed on a range of complex technical and institutional rules for power trading that are now incorporated in the GMS Regional Grid Code (RGC) that was recently published on the GMS website. Two recent energy planning studies demonstrate how the GMS regional power trade can bring short-term net economic benefits of about 5–8 times the investment worth from $3 billion to $4 billion in about 14 proposed GMS interconnections.

      The aim of the next stages of the Road Map is to both harmonize the existing national grid codes (NGCs) to comply with the RGC’s overarching regional structure and build a series of interconnections to enable fully synchronized power trading throughout the GMS before 2030. However, there is still much to do to implement a grid-to-grid power trading regime, including the construction of new transmission lines and substations dedicated to cross-border trading. Given the uncertainties of regional politics, along with the concerns about the impact of coronavirus disease (COVID-19) on electricity demand and supply within the GMS, it is clear that the final stage of the Road Map is some way off. This was envisaged at the time, with ADB’s Greater Mekong Subregion Energy Sector Assessment, Strategy, and Road Map published in 2016 noting that "most of the GMS countries will have moved to multiple sellers–buyers regulatory framework, so a wholly competitive market can be implemented.

      Moreover, until the necessary central power trading organization is established and permanently staffed by members from the GMS, it will be difficult for the RPTCC with its part-time members to implement the plans to fully synchronize and harmonize the GMS transmission networks within the next decade. In the meantime, working groups must be empowered by their respective GMS authorities to continue to undertake the necessary tasks of gaining regulatory approval of the RGC for its further development and implementation, performing detailed feasibility studies of interconnections, promoting the development of efficient electricity markets, facilitating information exchange between

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