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By: Juben Bhaukajee MS By research Student Supervisors: Dr. Hari Neopane, Associate Professor Mr. Suraj Baral, Lecturer Department of Mechanical Engineering School of Engineering Kathmandu University
Outline of Presentation
• • • • • • • Introduction Problem Research question Objectives Methodology Research plan Expected outcome
• Energy, a fundamental necessity for every system • Electrical Energy- Electricity: Modern form of energy essential for industrial and overall development of country • Only 2.4% of total energy demand fulfilled by electricity • On going energy crisis in spite of huge hydropower potential • 43,000MW of Hydropower generation technically and economically feasible • 652.056 MW capacity; 956.10 Peak demand (FY 2011/12)
Energy consumption in 2010/11
Animal Residue, 5.68%
Electricity, Petroleum, 2.24% 8.18%
Agri Residue, 3.62%
Firewood, 77.16% Source: Ministry of Finance, Economic Survey 2010/11
survey necessary for export market. • Interest of Government and non governmental institutions towards hydropower development • Policies and plans made for facilitation of smooth development in hydropower sector • Nepal has small market. India being prime target .Background contd.
situation not improving • 35 hrs of load shedding every week in peak wet season • More than 50% of total population deprived of electricity • Imbalance in implementation of plans and resource utilization .Problems: Motivation for study • In spite of dedicated efforts from government and non governmental institutions.
20000 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 Load forecast 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 Energy (GWh) System peak load Source: NEA. 2010/11 .
A year in review.Source: NEA. 2011 .
Implementation and Impact – Centralized system – Lack of sufficient information during policy planning – Social and environmental issues • Planning: Generation and power evacuation expansion – – – – Cost and time overrun of projects Transmission system expansion not in tune with generation expansion Grid connection agreement with NEA (for IPP) Load factor problem • Economics: Economic and financial viability – Equity financing.Problem specification • Policy: Reform. risk management – Public private partnership – Foreign Direct Investment .
Synergy Power Development P.41 9.16 2067.09. P.01 4 5 6 7 8 Laughing Buddha Power Nepal P.10.05. Bhagwati Hydropower Development Co.658 2067. Ltd.8 4. P. Laughing Buddha Power Nepal P. Ltd.18 2063.5 1.09.04. Lower Indrawati Lower Chaku 2060. Ltd. United Modi Hydropower P.765 Mailung Khola Hydropower Mailung Khola Company P. Ltd.01 2068. Ltd.29 2067.Under construction HP projects S.15 2065. Ltd. Nyadi Group P.01 .95 4.12. Ltd.30 2068.03.12. Middle Chaku Siuri Khola Bijaypur I Lower ModinI Siprin 1.N 1 2 3 Developer Project Capacity RCOD (MW) 5 4. Sunkoshi Hydropower Co.9 9. Ltd.
11. Ltd.N 9 2 3 4 5 6 Developer Project Capacity RCOD (MW) 8.01 2069.52 2. Nepal Hydropower Ltd. Eastern Hydropower P.11. Ltd.03.2 2 2.4 3 3.01. Ltd Bhairavkunda Hydropower P. Ltd.475 2068. Ankhu Khola I P.02. Bojini Compani P.31 2069. Ltd. Bhairavkunda Charnawati Jiri Khola Jhyadi Khola Pikhuwa Khola .17 2069.12.14 2069. Electrocom and Research centre P.30 Ankhu Khola Jalbidhyut Co.Under construction HP projects S.01 2068.
Research Question “How can hydropower development be accelerated in the country. in order to establish an economical and efficient system operation and resource utilization” .
debt financing.Research Question contd. • What are the flaws in existing policies? – – – – How are policies formed? Who are the actors involved? How have they been implemented? What are the impacts? • How can the energy system be made more economical and efficient? – How can cost of generation be reduced? – How can time and cost overrun of projects be reduced? – How can power evacuation problem be solved? • How can investment in hydropower sector be encouraged. promoting public private partnership and foreign investment? . through equity.
• Identify the optimum financing method in order to implement the plans in accordance with national development plan and available resources. encouraging public private partnership in investment and foreign direct investment. .Objectives • Identify drawbacks of existing policy and status of planning and implementation and recommend mitigation measures • Prepare an energy model for generation expansion plan in order to create and economic and efficient system.
.Limitations • Availability of limited data due to confidentiality issue • Data from all the projects and institutions will not be taken. mainly data from under construction projects will be used.
wind etc.Delimitations • Research focused on Hydropower. distribution will not be dealt in detail . not in other forms of generation like solar. and then on power evacuation. • Focus mainly on generation planning.
Methodology Three dimensions of research Policy Energy Economics Energy planning .
Methodology: Policy analysis Policy analysis shall be carried out to understand historical context of policy reform. The framework shall include: • Institutional analysis • Stakeholder analysis . reform and implementation process and its impacts at different levels.
• “Organizational Mapping” shall be used as a tool to carry out institutional analysis. information and decision making. and the manner in which there is flow of resources.Institutional Analysis • It is carried out in order to understand the overall institutional structure. .
• Includes 3 analytical steps: – Institutional mapping – Process tracing – Process mapping .Organizational Mapping • Tool used to illustrate and analyze flows of resources. information and decision in an organization.
and helps identify probable risk and potential solutions .Organizational Mapping • Institutional mapping – Illustrates resources and responsibilities of agencies and organizations involved – Shall be done through analysis of case studies and Interviews with key Informants • Process tracing – It is a qualitative method for identifying the causeeffect flow of resources and decision making from change in policy and its implementation. – It tests the expected impact of a particular policy reform with the actual.
resources and decision making. – This tool helps to locate and identify the bottlenecks and constraints and to analyze opportunities for changing processes to make them more effective and efficient.Organizational Mapping • Process mapping – This is a tool that looks at the overall picture to illustrate the broader network of flow of information. . in policy implementation – It is a form of a flow diagram consisting of network of threads of process tracing.
their interests.Stakeholder Analysis • Stakeholders of policy are all the individuals. reforms. • Stakeholder analysis aims to identify stakeholder characteristics. . or interventions. groups and organizations who influence and who are affected by the reform and implementation of the policy. and the nature and degree of their influence on existing or future policies.
Stakeholder Analysis The following tools shall be used to carry out stakeholder analysis: • Stakeholder analysis matrices • Political mapping .
Stakeholder Analysis • Stakeholder analysis matrices – It is carried out through a combination of review of secondary literature and interactions with knowledgeable key informants – Stakeholder analysis matrices are used to list and plot the stakeholders and their relationship to the policy process. .
Stakeholder Analysis • Stakeholder analysis matrices shall be used to plot the following variables: – Degree to which policy reform impacts stakeholders – Level of interest of stakeholders – Level of importance to satisfy needs of each stakeholder – Level of influence stakeholder has in policy design and implementation .
Methodology: Economic Analysis Economic analysis is carried out in order to show that the proposed project achieves optimum utilization of resources and provides economic merit to justify investment in it. Storage) shall be carried to evaluate economic viability . • Economic analysis of different hydropower projects (ROR.
Economic analysis • • • • • • • • • The following analysis shall be carried out: Cost – benefit analysis Benefit to cost ratio Simple pay back period Initial rate of return Levelized cost of energy Cash flow analysis Discounted cash flow Net present value Internal rate of return .
Economic analysis: Data collection The following parameters shall be collected from different hydropower project to carry out economic analysis: Initial investment (one time cost) of power plant and transmission system Operational (running) cost including operation and maintenance Energy sales rate (PPA rate) Expected energy generation forecast • • • • .
Methodology: Energy planning • Planning : – A process of collection and analysis of information regarding power system – Demand analysis and forecast – Market survey – Demand side management – Generation expansion and operation model using Wein Automatic System Planning (Tool) .
It uses probabilistic simulation to evaluate the expected operation costs. .Methodology: Planning • WASP – A model to find economically optimal expansion policy for an electric utility. It uses dynamic programming to select the optimal expansion plan.
• Financial analysis is carried out from the view point of project developer. by selecting profitable projects and through suitable financing. with the objective of contributing to financial soundness of utility. • Tools: Ratio analysis. FIRR .Methodology: Economic and Financial analysis • Economic analysis is carried out from country view point with the objective of increasing national income by allocating resources to their best use.
Economic and financial analysis • • • • • • • • Cost Benefit Analysis Inflation Discount Rate Benefit Cost Ratio Net present Value Internal Rate of Return Uncertainty Risk Analysis .
trainings. workshops related to Energy policy. journals.Methodology: Approach • Data collection – Attend seminars. planning and economics – Take interviews with relevant personnel – Questionnaire survey • Primary data: Through questionnaires and interviews • Secondary data: From reports. papers. websites etc .
Methodology: Approach • Desk study: – – – – – – – – To collect background information Identify indicators and data to be analyzed Data base for data collection Questionnaire preparation For data collection Interviews Questionnaire survey Observation • Field visit: .
Economics MOEN Financial institutions WECS IPPs IPPAN . Planning.Data collection framework NEA Hydropower experts DOED Under construction projects Hydropower Policy.
Expected outcome • Policy problems. mitigation strategy • Economic and efficient energy model • Model for effective economic and financial evaluation of projects .
Research Schedule .
org http://www.np http://www. Viena. Subhas C.wec.org. World Bank • Energy Economics. Bhattacharyya • Expansion Planning for Electrical Generating Systems. Political.org http://www.np Tools for Institutional. Nepal . International Atomic Energy Agency.nea.References • • • • • http://www.fncci. Jalasrot Vikas Sanstha. and Social Analysis of Policy Reform. 1984 • Hydropower pricing in Nepal.doed.org.
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