Suriname’s Energy Sector

a bird view perspective

assessing Strategic Fit

through SWOT analysis, and
its implications

Daniël A. Lachman MSc CMRP

Presentation Overview

1. Brief background
2. Methodology
3. Brief on Suriname’s energy system
4. SWOT
5. The Iceberg Model
6. Achieving Strategic Fit
7. Concluding Remarks
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aniel A. Lachman MSc CMRP
 SWOT – brief background
Unit of Analysis
Future Present Internal External
Strength X X
Weakness X X
Opportunities X X
Threats X X
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aniel A. Lachman MSc CMRP
SWOT – brief background – cont’d
 Quick overview of current status
 Input for Strategy building

Threats
Weaknesses
Future State
Strength
Opportunities
Current Normative
Situation Scenario

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aniel A. Lachman MSc CMRP
SWOT – brief background – cont’d
 Strategic Fit
 SW aligned with OT?
  strategies, action plans

To assess the degree of Strategic Fit

of the energy sector in Suriname
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aniel A. Lachman MSc CMRP
 Strategy and
Policy building

Methodology

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aniel A. Lachman MSc CMRP
Brief on Suriname’s energy
system
 420 + 15 + 84 + 5 MW
 EPAR-ENIC-Brokopondo-Rosebel
 DEV: 111 villages
 Demand: 130.3 MW
 115,000 customers
 Subsidy: SRD 100M
 Coverage: 79%
 US$ 0.06/kWh
 Growth: ± 8-12%
Edulink
aniel A. Lachman MSc CMRP
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Edulink D
aniel A. Lachman MSc CMRP
Presentation Overview

1. Brief background
2. Methodology
3. Brief on Suriname’s energy system
4. SWOT
5. The Iceberg Model
6. Achieving Strategic Fit
7. Concluding Remarks
Edulink D
aniel A. Lachman MSc CMRP
 … if you
“Any tool is know how
useful… to use it”
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aniel A. Lachman MSc CMRP
D – The Fist of th
North Star
SWOT - Strengths
Strengths
 Abundant RE resources
 Small scale  easy transition possible
 Awareness in education
 Awareness in Government: white paper, RE
assessments, energy authority
 EBS: energy efficiency & savings
awareness

Edulink D
aniel A. Lachman MSc CMRP
SWOT - Strengths - cont’d
Energy potential:
 4000 MW hydropower (run-of-the-river)1)

 Kabalebo: 850 MW2)

 Tapajai: 305 + 116 MW 3)

 Guyana-stream: 5 GW4)

 Solar: ± 7 – 52 GW

 Wind, Tidal, Wave, etc.: to be explored

1)
BWKW 1981
2)
Ng A Tham 1987

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3)
Boksteen 2008
aniel A. Lachman MSc CMRP
4)
Geeraert 2009
SWOT - Weaknesses
Weaknesses
 High energy intensity
 No energy act, institute and authority
 Fragmented decision making / No centralized coordination
 Politicized decision making
 Too low tariffs  poor financial position utilities
 Opaque subsidy scheme
 Centralized power dispatch
 Small scale  rigid regimes
 Deficient government capacity
 Outdated legal framework
 Relative high T&D losses
 No production excellence
Edulink
aniel A. Lachman MSc CMRP
D

 Availability + system bias

SWOT – Weaknesses – cont’d
Weaknesses
 Uncertainty:
 Consumption patterns
 Effects of natural resource exploitation
 Public acceptance of unpopular measures
 Acceptance of (R)E - NIMBY
 Discovery/depletion of domestic energy
sources
 Entrance/exit of large energy consumers
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aniel A. Lachman MSc CMRP
SWOT – Weaknesses – cont’d
 Suriname  Uncertainty

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aniel A. Lachman MSc CMRP
Lachman 2009a
SWOT – Weaknesses – cont’d
 Offshore possibilities

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aniel A. Lachman MSc CMRP
SWOT – Weaknesses – cont’d
 Uncertainty rises:
 Increasing complexity
 Globalization
 Intertwined
 Megatrends
 Etc.

 Suriname’s small nature:

 Trends are easily broken

(e.g. “sudden” expansions / investments)

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aniel A. Lachman MSc CMRP
Dilemma

On one hand:
 Big timeframe from decision-making to
production
 Long life-span
 Enormous (financial) resources
“locked”
On the other hand:
 Increasing Uncertainty
Edulink D
aniel A. Lachman MSc CMRP
SWOT – Weaknesses – cont’d
 Bias towards: AVAILABILITY
meeting demand relentlessly

Despite:
• Huge amount of subsidies
• Inefficient production (cost of the hidden
plant)
• Inefficient consumption, no demand-side
management
 1743 kWh/cap (in range with LA&C, but
heavily skewed)* *Source: Lachman 2009b
Edulink D
aniel A. Lachman MSc CMRP
SWOT – Weaknesses – cont’d

end-of-pipe solutions
Existing energy system has become the
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Rule-
set / Regime in Suriname
aniel A. Lachman MSc CMRP
SWOT – Weaknesses – cont’d

Edulink D
aniel A. Lachman MSc CMRP
SWOT - Opportunities
Opportunities
 Technological progress & convergence
technology
 Potential energy project investors
 Technical pooling: education,
technical, training
 Regional transition spillovers

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aniel A. Lachman MSc CMRP
 Energy Technologies Ranking
– cont’d
Promising energy technologies?
- Ocean Thermal Energy Conversion
- Extra-terrestrial Solar Power
- Pressure-Retarded Osmosis
- Flying kites / laddermill
- Urban wind turbines
- Hygro-electricity
- Run-of-the-River
- Nuclear Fusion
- Bio-hydrogen
- Artificial leaf
- Solar Tower
- Oilgae

Edulink D
aniel A. Lachman MSc CMRP
SWOT - Threats
Threats
 Uncertainty
 Effects of climate change on (R)E
 Transfer of new energy technologies
 Global willingness to put CC above domestic /
economic interests
 Dilemma local energy project financing
 Oil price
 Global economic climate
 Technological breakthroughs
 Timing of Peak Oil
Edulink D
aniel A. Lachman MSc CMRP
SWOT – Threats – cont’d
 Suriname  Uncertainty

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aniel A. Lachman MSc CMRP
Lachman 2009
SWOT – Threats – cont’d

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aniel A. Lachman MSc CMRP
SWOT – Threats – cont’d
 Less precipitation  hydro
 Increased evaporation  hydro
 Extreme weather events  energy infrastructure
 Due to elevated temperatures
 Less yield  thermal
 Steep increase in climate control requirement  energy
demand
 Variation in vegetation behavior  bio-fuels
 Rising sea levels  energy infrastructure
*IEA 2013
Lachman 2013a,b
IPCC 2013
Edulink D
aniel A. Lachman MSc CMRP
Contreras-Lisperguer R. and de Cuba
SWOT – Threats – cont’d
 Tipping point

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aniel A. Lachman MSc CMRP
SWOT – Threats – cont’d
 Export ban

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aniel A. Lachman MSc CMRP
SWOT – Threats – cont’d
 Re-negotiating Afobaka?

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aniel A. Lachman MSc CMRP
Presentation Overview

1. Brief background
2. Methodology
3. Brief on Suriname’s energy system
4. SWOT
5. The Iceberg Model
6. Achieving Strategic Fit
7. Concluding Remarks
Edulink D
aniel A. Lachman MSc CMRP
 It has been said
something as small as the
flutter of a butterfly’s
wing can ultimately cause
a typhoon halfway
around the- Chaos
worldTheory

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aniel A. Lachman MSc CMRP
The Iceberg Model
 Looking for underlying “driving” factors
 These cause sensible phenomena

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aniel A. Lachman MSc CMRP
 The Iceberg Model – cont’d
Bias
Centralized power dispatch Path Dependency
Rigid regimes Education

Fragmented decision making

Politics
Deficient government capacity
Outdated legal framework Level of Policy Making
Opaque subsidy scheme Education
Inability to deal with uncertainty

Relative high T&D losses

No production excellence } Path Dependency
Education

Poor fin status of utilities

High energy intensity }
Edulink Too low tariffs
aniel A. Lachman MSc CMRP
D
“No questions. No answers.
That is the business we are in.
You accept it and move on.”
- Vincent in John
Frankenheimer’s “Ronin”

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aniel A. Lachman MSc CMRP
Strategic Fit
 Path Dependency
 Ailment: Education

 Quality of Strategizing & Policy Making

 Ailment: Education

 Lack of education is the biggest driving factors for:

1) not using the strengths effectively
2) the proliferation of weaknesses
3) the inability to capitalize on opportunities
4) the inability to deal with threats

Education is the biggest trump card

to achieve strategic fit
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aniel A. Lachman MSc CMRP
Strategic Fit – cont’d
The 4 Levels of Change
effective
CHANGE
begin
firm
BELIEF
forming
full

UNDERSTANDING
partial

complete
AWARENESS
initial
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aniel A. Lachman MSc CMRP
Strategic Fit – cont’d

Edulink D
aniel A. Lachman MSc CMRP
Strategic Fit – cont’d

I. Maximum energy portfolio

diversification

Edulink D
aniel A. Lachman MSc CMRP
Strategic Fit – cont’d

II. Decentralized energy system

Edulink D
aniel A. Lachman MSc CMRP
Strategic Fit – cont’d

III. Energy efficiency & conservation

(less generation required)

Edulink D
aniel A. Lachman MSc CMRP
Strategic Fit – cont’d

IV. Smart grids

Edulink D
aniel A. Lachman MSc CMRP
Strategic Fit – cont’d
 Diversification
 Decentralization
 Interconnectedness
 Two-way communication
 Efficiency & Saving
 Production Excellence

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aniel A. Lachman MSc CMRP
Concluding Remarks – cont’d
 Paradigm shift required on all levels

1) Belief
2) Scenario Creation
3) Vision
4) Strategy
5) Transition Management
6) Policy

Edulink
7) Action Plans
D
aniel A. Lachman MSc CMRP

8) RD&D, Engineering
Concluding Remarks
 Energy Sector increasingly challenged
 Challenges inherent to energy system
 Inability of system to deal with challenges
 Energy Sector requires Transition
 Transitions are based on paradigm shifts,
re-learning, 4 Levels of Change, etc.
 Best possible way to tackle this, is
through education
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aniel A. Lachman MSc CMRP
Concluding Remarks – cont’d
 Solid education program is therefore
required, that focuses on:
 Energy Engineering (generation, T&D, R&D)
 Energy Resource Assessments
 Energy Strategy & Policy
 Energy Scenarios & Transitions
 Social and Environmental Impacts of Energy
Systems
 Business Administration in Energy Systems
 Etc. Edulink D
aniel A. Lachman MSc CMRP
The Butterfly Effect

“Change one thing, change

everything”
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aniel A. Lachman MSc CMRP
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“Every Epoch Dreams its Successor”
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– aniel
Jules Michelet
A. Lachman MSc CMRP