1. Feed-in tariffs and south-south policy/technology transfer: The evolution and implementation of Very Small Power Producer (VSPP/SPP) Regulations in Thailand and Tanzania Monterey Institute for International Studies Monterey, California, USA 8 May 2010 Chris Greacen chris@palangthai.org

2. Palang Thai พลังไท Thailand NGO Objective: – To ensure that the transformations that occur in the region's energy sector: augment, rather than undermine, social and environmental justice and sustainability. Key approaches: – We teach hands-on energy technology – We draft / comment on policies – We work to empower citizens to look critically at government and industry projects and plans – We advocate structural reform พลัง (palang): n 1. Power. 2. Empowerment. ไท (thai): adj. 1. Independence. 2. Self-reliance

3. Can’t we hook it up and sell power back? Mae Kam Pong village microhydro

4. Meeting between National Energy Policy Offic (NEPO) and Mae Kam Pong villgers to discuss grid interconnection of their village micro-hydro

5. $

6. Technical regulations: Allowable voltage, frequency, THD variations Protective relays – 1-line diagrams for all cases: Induction Synchronous Inverters Single/multiple Connecting at different voltage levels (LV or MV) Communication channels Commercial regulations: Definitions of renewable energy, and efficient cogeneration Contract parties Cost allocation Principle of standardized tariff determination Invoicing and payment arrangements Arbitration $ + Standardized Power Purchase Agreement (PPA)

7. Import (3%)‏ EGAT (45%)‏ IPPs (42%)‏ Generation (% share)‏ Transmission Distribution EGAT (100%) PEA (66%)‏ MEA (32%)‏ Direct Customers (2%)‏ Users SPPs (10%)‏ Thailand’s Electricity Industry Structure

8. Import (3%)‏ EGAT (45%)‏ IPPs (42%)‏ Generation (% share)‏ Transmission Distribution EGAT (100%) PEA (66%)‏ MEA (32%)‏ Direct Customers (2%)‏ Users VSPPs (<1%)‏ SPPs (10%)‏ Thailand’s Electricity Industry Structure

9. Import (3%)‏ EGAT (45%)‏ IPPs (42%)‏ Generation (% share)‏ Transmission Distribution EGAT (100%) PEA (66%)‏ MEA (32%)‏ Direct Customers (2%)‏ Users VSPPs (<1%)‏ SPPs (10%)‏ Thailand’s Electricity Industry Structure Firm / non-firmPeak / off-peak

12. Evolution of Thai VSPP regulations 2002 – VSPP regulations drafted, approved by Cabinet – Up to 1 MW export, renewables only – Tariffs set at avoided cost (bulk supply tariff + FT)

14. Biogas from Pig Farms Reduces air and water pollution Produces fertilizer Produces electricity 8 x 70 kW generator Ratchaburi

15. Biogas from Pig Farms

16. 40 kW Mae Kam Pong, Chiang Mai, Thailand Micro hydropower

17. Uses waste water from cassava to make methane Produces gas for all factory heat (30 MW thermal) + 3 MW of electricity 3 x 1 MW gas generators Korat Waste to Energy – biogas … an early Thai VSPP project

18. Evolution of Thai VSPP regulations 2002 – VSPP regulations drafted, approved by Cabinet – Up to 1 MW export, renewables only – Tariffs set at avoided cost (bulk supply tariff + FT) 2006 – Up to 10 MW export, renewables + cogeneration – Feed-in tariff “adder” – If > 1 MW then utility only pays for 98% of energy

19. Rice husk-fired power plant 9.8 MW Roi Et, Thailand

20. Bangkok Solar 1 MW PV Project size: 1 MW Uses self-manufactured a-Si

21. Evolution of Thai VSPP regulations 2002 – VSPP regulations drafted, approved by Cabinet – Up to 1 MW export, renewables only – Tariffs set at avoided cost (bulk supply tariff + FT) 2006 – Up to 10 MW export, renewables + cogeneration – Feed-in tariff “adder” – If > 1 MW then utility only pays for 98% of energy 2009 – Tariff adder increase, more for projects that offset diesel http://www.eppo.go.th/power/vspp-eng/http://www.eppo.go.th/power/vspp-eng/ for English version of regulations, and model PPA

22. Thai VSPP feed-in tariffs Assumes exchange rate 1 Thai baht = 0.029762 U.S. dollars FuelAdderAdditional for diesel offsetting areas Additional for 3 southern provinces Years effective Biomass Capacity <= 1 MW $ 0.015 $ 0.030 7 Capacity > 1 MW $ 0.009 $ 0.030 7 Biogas <= 1 MW $ 0.015 $ 0.030 7 > 1 MW $ 0.009 $ 0.030 7 Waste (community waste, non-hazardous industrial and not organic matter) Fermentation $ 0.074 $ 0.030 7 Thermal process $ 0.104 $ 0.030 7 Wind <= 50 kW $ 0.134 $ 0.045 10 > 50 kW $ 0.104 $ 0.045 10 Micro-hydro 50 kW - <200 kW $ 0.024 $ 0.030 7 <50 kW $ 0.045 $ 0.030 7 Solar $ 0.238 $ 0.045 10 Tariff = adder(s) + bulk supply tariff + FT charge Biomass tariff = $0.009 + $0.049 + $0.027 = $0.085/kWh

23. www.pea.co.th call center 1129 23 การไฟฟ้าส่วนภูมิภาค การไฟฟ้าส่วนภูมิภาค PROVINCIAL ELECTRICITY AUTHORITY Generating Capacity supply to Grid from 2006 - August 2009

24. VSPP project pipeline as recorded in EPPO data Application under consideration Permission received, awaiting PPA PPA signed Generating & selling electricity Leakage (Project abandoned)

25. Jun 2009 Thailand VSPP Status

26. Dec 2009 Thailand VSPP Status

27. Mar 2010 Thailand VSPP Status

28. Mar 2010 Thailand VSPP Status 811 MW online

29. Mar 2010 Thailand VSPP Status 811 MW online PPAs signed for additional 4159 MW

30. Import (3%)‏ EGAT (45%)‏ IPPs (42%)‏ Generation (% share of GWh)‏ Transmission Distribution EGAT (100%) PEA (66%)‏ MEA (32%)‏ Direct Customers (2%)‏ Users VSPPs (<1%)‏ SPPs (10%)‏ … but it’s still a tiny part of Thailand’s electrical energy

31. Evolution of Tanzania SPP regulations Approved by regulator August 2009 Up to 10 MW export, renewables & cogeneration SPP Tariffs at average of LRMC and SRMC – Grid-connected SPP tariff (2009): $0.066/kWh – In rural mini-grid areas offsetting diesel (2009): $0.26/kWh 5 PPAs signed by March 2010 www.ewura.go.tz/sppselectricity.htmlwww.ewura.go.tz/sppselectricity.html for English versions of regulations, and model PPAs

34. Wealthy countries pay Feed-in tariff incremental costs?

35. GET FiT proposed mechanism

37. South-south policy/technology transfer: Technical Visit of the Delegation from the United Republic of Tanzania to Thailand regarding Thailand’s Very Small Power Producer (VSPP) program 13-20 March 2010

40. www.pea.co.th call center 1129 40 การไฟฟ้าส่วนภูมิภาค การไฟฟ้าส่วนภูมิภาค PROVINCIAL ELECTRICITY AUTHORITY How we have done? Submitted Proposals Line connecting construction Meter installation Meter reading Billing Acceptance Letter PPA signedFirst synch.CODEvery 1 ft Meter reading license check All test PPA Check Document check Identify circuit connection System study All license check VSPP will get first settlement within 3 month after COD.

41. www.pea.co.th call center 1129 41 การไฟฟ้าส่วนภูมิภาค การไฟฟ้าส่วนภูมิภาค PROVINCIAL ELECTRICITY AUTHORITY Who have involved in PEA ? DG office Technical & System Analysis Document Coordinator Research Div. PQ test Relay Div. Switchgear & Relay test Meter Div. Meter installation System Operation Div. First synch. test System Operation Area Office 1-12 Identify circuit connection Control & Operation Communication Area Office 1-12 & Local Office Line connecting construction Meter reading Tariff Div. Billing Finance Dep. Settlement Legal Div. PPA check

59. Thailand VSPP Tanzania Vietnam? Philippines?

60. Winter 2010-11 … community built, community-owned, profitable VSPP micro-hydro in Thailand

64. http://www.soho-properties.com/condobangkok-leraffine31/ Unlimited living?

65. Office of the National Economic and Social Development Board O F F I C E O F T H E P R I M E M I N I S T E R Low Quality Education Low Quality labour Insufficient in R&D Investment Slow Technology Development Low Quality for Raw-material, machinery and equipment (Low margin/return) Low Basic infrastructure and Logistic development Enabling factors: MACROECONOMIC MANAGEMENT No immunity/ High volatility Financial System Lack of Saving Lack of regulation on industrial product’s quality control Low Value Creation High Import Contents & Sheer size of export to GDP High Energy Intensity & Low Efficiency & Unsustainable structure Macroeconomic Analysis

67. Electricity production and consumption (GWh) 1700 families relocated Loss of livelihood for >6200 families Loss of 116 fish species (44%) Fishery yield down 80% 65 Mae Hong Song Source: MEA, EGAT, Searin, Graphic: Green World Foundation Dams Malls Province Pak Mun Impacts of Pak Mun Dam alone

71. Bonok-Ban Krud story

72. Bonok Bankrud

73. Power Demand: Projections vs. Actual 1992 – 2009 If no systemic bias, the chance of over-projecting demand 15 times in a row = (½) 15 = 1/32,768 MW

74. 2007 2008 2009 E x c e s s c a p a c i t y Generation capacity in excess of demand (2007-2009) Fictional power demand did lead to real investments that become waste & burden (not to mention disturbed ecology, communities) Excess gas/ pipeline capacity/ generation capacity economic waste + excess burden for consumers Under centralized monopoly structure Source of data: EGAT 2010. หมายเหตุ คำนวณจากกำลังผลิตติดตั้งและความต้องการไฟฟ้าสูงสุดรายเดือน Very little incentives to do energy efficiency/conservation

75. Linear versus exponential extrapolation

76. Fuel mix in power generation - power development plan 2007 GWh Import Nuke RE Gas Coal Lignite Hydro

77. PDPs of the Pacific Northwest, USA Source: Seattle City Light

78. Concluding thoughts VSPP regulations enable small generators together to profitably make substantial contributions to electricity generation. Zero / small carbon footprint Useful for decreasing diesel expenditures for rural electrification VSPP projects help develop local engineering / project development capacity. South-South policy/technology exchange English versions of regulations available online Still a drop in the bucket in Thailand… IRP needed

79. Thank you chris@palangthai.org This presentation available at: www.palangthai.org/docs VSPP regulations available at: http://www.eppo.go.th/power/vspp-eng/ And www.ewura.go.tz/sppselectricity.html