CEYLON ELECTRICITY BOARD

Transmission DivisionCeylon Electricity Board

Sri Lanka

May 2016

Sri Lanka’s Power Generation

Past, Present and Future

Eng. Noel Priyantha- Chief Engineer (Renewable Energy)Eng. Buddhika Samarasekara- Chief Engineer (Generation Planning)

The average per capita electricity consumption in 2015 was 562 kWh/person.

Per Capita Electricity Consumption (2004-2015)

Installed Capacity and Peak Demand

2

Less significant relationship betweenGDP growth and Electricity demandgrowth in recent years

GDP Growth % & Elec. Demand Growth %

Country 2009 2010 2011 2012

Bangladesh 221 247 259 278

India 605 641 684 753

Japan 7838 8378 7848 5190

Malaysia 3934 4136 4246 3405

Pakistan 450 458 449 649

Singapore 7896 8438 8404 8595

Vietnam 917 1035 1073 907

Comparison with Regional Countries(kWh/person)

0

400

800

1200

1600

2000

2400

2800

3200

3600

4000

4400

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Inst.

Capacity &

Peak D

em

and (

MW

)

Year

Installed capacity

Peak Demand

250

275

300

325

350

375

400

425

450

475

500

525

550

575

600

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

kWh

/pe

rso

n

Year

SRI LANKAN STATISTICS –POWER SECTOR

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

201

5

Ele

c D

em

an

d G

row

th (

%)

GD

P G

row

th R

ate

(%

)

Year

GDP

Electricity

0

500

1000

1500

2000

2500

Load

(M

W)

Time

NCRE

CEB Hydro

IPP Thermal

CEB Thermal

TYPICAL LOAD CURVE OF SRI LANKA

4

CEB Hydro38%

CEB Thermal-

Coal34%

CEB Thermal-

Oil8%

IPP Thermal

9%

NCRE 11%

Energy Share in GWh- 2015

CEB Hydro36%

CEB Thermal -

Coal23%

CEB Thermal -

Oil14%

IPP Thermal

16%

NCRE 11%

Capacity Share in MW - 2015

1.48

6.64

16.83

27.55 31.62

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

CEB - Hydro CEB - Coal Renewable Energy CEB - Thermal IPP - Thermal

LKR

/kW

h

Generation Technology

Average Cost per Unit for Generation Technologies (For Year 2015)

PRESENT CAPACITY MIX AS AT DECEMBER 2015

Historical NCRE Contribution

5

Year

Energy Generation (GWh) Capacity (MW)

NCRE System

Total

NCRE Total System Installed

Capacity

2003 120 7612 39 2483

2004 206 8043 73 2499

2005 280 8769 88 2411

2006 346 9389 112 2434

2007 344 9814 119 2444

2008 433 9901 161 2645

2009 546 9882 181 2684

2010 724 10714 212 2818

2011 722 11528 227 3141

2012 730 11801 320 3312

2013 1178 11962 367 3355

2014 1215 12418 442 3932

6

Renewable Energy Contribution

0%

10%

20%

30%

40%

50%

60%

70%

0

1000

2000

3000

4000

5000

6000

7000

8000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Per

ece

nta

ge %

Ener

gy (

GW

h)

Year

NCRE Large Hydro Percentage of Renewable Energy from Total Energy

RENEWABLE ENERGY- PRESENT STATUS

0

1000

2000

3000

4000

5000

6000

7000

8000

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

2000 2005 2010 2015 2020 2025 2030 2035

Pea

k D

em

and

(M

W)

Ener

gy D

eman

d (

GW

h)

Year

Energy

Peak

Actual Forecast

ACTUAL AND FORECAST ENERGY/PEAK DEMAND (AS PER DRAFT LTGEP 2015-2034)

FUTURE GENERATION OPTIONS - NON CONVENTIONAL

8

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

0

500

1000

1500

2000

2500

3000

3500

4000

4500

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

20

31

20

32

20

33

20

34

20

35

20

36

20

37

20

38

20

39

20

40

20

41

Cap

acit

y (M

W)

Year

NCRE Additions

Solar (MW) Biomass (MW)

Wind (MW) Mini Hydro (MW)

PROJECTION ON COMPARSION OF CO2 SAVINGS

9

PRESENT STATUS OF NCRE TARIFF

10

PRINCIPLES OF TARIFF FIXING• Renewable energy, which is a natural resource, belongs to the

State.• Renewable energy should produce electricity in the long term

at prices below the cost of thermal power plants, using oil orcoal, or even gas.

• Developers are provided with a high tariff to cover theirexpenses and reasonable profits for an adequately long period(in this case fifteen years.) Cost based , technology specific andthree tiered or flat tariff

• Tier 1: Years 1- 8 ;Tier 2: Years 9 – 15; Tier 3: Years 16 – 20• (SPPA period – 20 years)• This tariff will be limited to small power producers ( Capacity

up to 10 MW)• This tariff has been designed to eliminate the problems of

negative cash flows experienced by many small powerproducers during the period of loan repayment.

11

NCRE TechnologyNo of

ProjectsCapacity (MW)

1 Mini Hydro Power 95 177

2Biomass - Agricultural & Industrial Waste

2 4.5

3 Biomass - Dendro Power 13 51

4 Biomass – Municipal Waste 1 10

5 Solar Power 4 40

6 Solar Thermal 3 30

7 Wind Power 1 1

Total 119 314

SPPA Signed NCRE Projects – Present Status

PROJECTS IN THE PIPELINE - NCRE

WHY CLIMATE FINANCE

• To reduce the Unit Generation Costs

12

7.027.95 9.63

12.97 13.73

16.61 17.8818.9

23.37

29.52

33.08

0

5

10

15

20

25

30

35

Trinco Coal250MW, 70%

New Coal300MW,70%

Wind 25MW,30%

LNG 300MW,70%

Dendro 5MW,70%

Solar 10MW,17%

CCY 300MW,70%

CCY 150MW,70%

Solar withbattery

10MW, 17%

GT 105MW,20%

GT 35MW,20%

Un

it g

en

era

tio

n c

ost

(U

Scts

/kW

h)

Power plant and typical plant factor (%)

Unit Generation Costs for Different Power Plants at Typical Plant Factors

• Sri Lanka seeks Climate Finance to reduce the present high cost of Renewable Energy – CPF support in this regard is highly welcome.

• Possibility of reducing the present feed in tariff payable to NCRE in future, sharing the carbon credits among stake holders including CEB, if appropriate.

• Overall Sector Development through use of carbon credits

Present Status : INDC

13

• TO ACHIVE EMISSION REDUCTION AT LEAST IDENTIFIED FROM INDCs

CHALLENGES TO OVERCOME & SOME SUGGESTONS TO EXPLORE

• If carbon markets revive, opportunity to get competitive prices for carboncredits may be lost by entering into long term agreements only with theWorld Bank Group.• Inclusion of some provisions in to ERPA to avoid such possibility

• Whether private sector will fully engage in to the CPF program and agree tosell credits to CEB as they may get better credits from competitive market.• Directive from the government, a long term proposition• Waive off credit rights as part of the SPPA that offers feed-in-tariffs

• According to present practice, all carbon credit programs should be directedby the Climate Change Secretariat (CCS).• Engaging CCS from the beginning and seeking their approvals as needed

• Understanding the impact on Intended Nationally Determined Contributions(INDCs), submitted by the Ministry of Mahaweli Development andEnvironment, Once CEB signs the SPA and ERPA, relevant carbon reductionwill be removed from the country and country cannot claim for any reductionof emissions.• Inclusion of ‘unconditional’ target in the baseline and credits from

‘conditional target’

14

THANK YOU

15

Additional slides

16

SRI LANKA Total Area : 65,610 km2

Land Area : 62,705 km2

Population : 20.97 million

Urban : 18.3% Rural : 81.7%

Population Density : 334 per/ sqkm

Labour Force : 8.973 million

Unemployment rate : 4.6%

Literacy rate : 93.3%

Life expectancy: 72 yrs (M), 78 yrs (F)

Monetary Unit : Sri Lankan Rupee

(1 USD = 146.19 LKR at 01.01.2016)

INTRODUCTION

Gross Domestic Product : 11,183 billion LKR

(Market Prices)

GDP per capita : 3,924 US$ (Market Prices)

GDP structure 2015

Agriculture – 7.85% Industry – 26.20%

Services – 56.61% Taxes less subsidies on products – 9.34%

FUTURE GENERATION OPTIONS - NON CONVENTIONALProjected NCRE capacity

18Based on Draft LTGEP 2017-2036

Year

Mini

Hydro

(MW)

Wind

(MW)

Biomass

(MW)

Solar

(MW)

Solar Net

Metering

(MW)

Total NCRE

Capacity

(MW)

Annual Total

NCRE

Generation

(GWh)

Share of NCRE

from Total

Generation %

2017 329 144 34 21 20 548 1782 12.1%

2018 344 244 39 121 26 774 2337 15.0%

2019 359 294 44 221 32 950 2720 16.4%

2020 374 464 49 371 39 1297 3530 20.3%

2021 384 539 54 371 44 1392 3840 21.1%

2022 394 609 59 471 50 1583 4277 22.4%

2023 404 669 64 571 55 1763 4663 23.2%

2024 414 714 69 571 60 1828 4875 23.1%

2025 424 799 74 671 64 2032 5339 24.1%

2026 434 799 79 771 69 2152 5553 23.9%

2027 444 824 84 771 74 2197 5702 23.4%

2028 454 869 89 871 79 2362 6051 23.6%

2029 464 894 94 871 83 2406 6200 23.1%

2030 474 964 99 971 88 2597 6619 23.5%

2031 484 999 104 971 93 2651 6785 23.0%

2032 494 1044 104 1071 98 2811 7099 23.0%

2033 504 1114 109 1071 102 2900 7378 22.9%

2034 514 1184 109 1171 107 3086 7763 23.0%

2035 524 1254 114 1271 112 3275 8186 23.2%

2036 534 1349 114 1271 117 3385 8506 23.1%

ENVIRONMENTAL ASPECTS

Comparison of CO2 Emissions from fuel combustion

19

Countrykg CO2/2005 US$ of GDP

kg CO2/2005 US$ of GDP Adjusted to

PPP

Tons of CO2

per CapitaGDP per capita (current US$)

Sri Lanka 0.33 0.08 0.67 3,280Pakistan 0.94 0.19 0.74 1,275

India 1.25 0.32 1.49 1,498Indonesia 0.94 0.21 1.70 3,475Thailand 1.07 0.30 3.69 5,779

China 1.85 0.64 6.60 6,807France 0.13 0.15 4.79 42,560Japan 0.26 0.30 9.70 38,634

Germany 0.24 0.26 9.25 46,251USA 0.35 0.35 16.18 53,042

World 0.57 0.37 4.52

IEA CO2 Emissions from Fuel Combustion (2014 Edition)-2013 data, World Bank website 2013 data

20

Present NCRE Projects Approval Process

Main Parameters

Debt equity ratio - 60:40

Loan repayment - 8 years

Construction period - 2 years

Return on equity (ROE) - 22 %

Plant factor and O & M percentages

Technology Plant Factor

O & M Percentage (Year 1-15)

O & M Percentage

Year (16 -20)

Mini Hydro 42 % 3 % 3 %

Mini Hydro – Local 42 % 3 % 3 %

Wind 32 % 1.5 % 1.5 %

Wind – Local 32 % 1.5 % 1.5 %

Biomass ( dendro) 80 % 4 % 5 %

Biomass (agricultural & industrial waste)

80 % 4 % 5 %

Waste Heat Recovery

67 % 1.33 % 1.33 %