Energy Planning, Methodology and Approaches: Jamaica’s Experience
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Transcript of Energy Planning, Methodology and Approaches: Jamaica’s Experience
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Energy Planning, Energy Planning, Methodology and Methodology and
Approaches:Approaches:Jamaica’s ExperienceJamaica’s Experience
““Latin American and Caribbean Latin American and Caribbean Energy Forecast – Energy Energy Forecast – Energy
Scenarios at 2032”Scenarios at 2032”OLADE Sub-regional WorkshopOLADE Sub-regional Workshop
February 19, 2009February 19, 2009
Conroy WatsonConroy WatsonSenior DirectorSenior Director
Ministry of Energy, JamaicaMinistry of Energy, Jamaica
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February 2009 Ministry of Energy, Jamaica, W.I. 2
OutlineOutline
• Introduction• World Oil Market• Jamaica’s Energy Profile• Market Structure• Petroleum Market• Electricity Sector• Energy Modeling, Planning & Policy Guidelines• Energy Conservation and Efficiency• Way Forward• Concluding Remarks
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IntroductionIntroduction
• Jamaica is an oil importing developing country
• Petroleum imports satisfy more than 90% of the country’s energy needs
• Highly susceptible to global market conditions
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World Oil MarketWorld Oil Market
• Influences on global economy– Emerging markets (China, India)– Reserves
• Rate of new discoveries– Volatility of oil prices
• Market speculation• Geopolitical developments• Changes in production strategies• Uncertainty in supplies
• Crude and product prices– Crude prices traded at US$147/bls in 2008
• Averaged US$99.67/bls– Price decline started at the end of 2008– False sense of security
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SUPPLYSUPPLY REFINERYREFINERYSECTORALSECTORAL
CONSUMPTIONCONSUMPTIONEND-USEEND-USE
DEMANDDEMAND
VENEZUELA
MEXICO
ECUADOR
NIGERIA
T & T
OPEN MARKET
VENEZUELA
MEXICO
ECUADOR
NIGERIA
T & T
OPEN MARKET
JAMAICAJAMAICA
AGRIAGRI
BAUXITE / BAUXITE / ALUMINAALUMINA
ELECTRICITYELECTRICITY
MANUFACTUREMANUFACTURE
PUBLIC SERVICEPUBLIC SERVICE
RESIDENTIALRESIDENTIAL
TOURISMTOURISM
TRANSPORTTRANSPORT
DISTRIBUTEDISTRIBUTE
DIST.DIST.
LIGHTINGLIGHTING
HEATINGHEATING
COOKINGCOOKING
REFRIGERATEREFRIGERATE
A/CA/C
MOTOR / MOTOR / ENGINE ENGINE POWERPOWER
STEAMSTEAM
STORE&
REFINE
STORE&
REFINE
Jamaica’s Energy ProfileJamaica’s Energy Profile
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Market StructureMarket Structure• Petroleum
– Liberalized petroleum market– State owned refinery– 10 marketing companies
• 1 state owned marketing company• 3 multinationals• 6 Local marketing companies (private)
– Approx. 300 service stations island-wide
• Electricity– Largest supplier: JPS– Electricity generation is done competitively– Single distributor– Three Independent Power Producers– Other producers
• Bauxite/Alumina companies• Caribbean Cement Company Ltd• Sugar Factories
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Petroleum MarketPetroleum MarketDrill & Process
Distribution
Bauxite & Mining
Electricity Generation
Transportation
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Imports and ConsumptionImports and Consumption
2006 2007 2008** 2010** 2020**
Oil import bill (US$ million)
1,838 2,0082,700…
2,9002,100 3,300
Oil imports (million bls)
31 30 28 to 29 30 33
Total Energy Consumption (million boe)
28 28 26 27 28 ...32
** Assumptions for projections: (1) conservation and efficiency efforts successful and continuous (2) alternative energy projects developed (ethanol, wind, bio-diesel, coal, CNG, Petcoke) (3) oil price 2010: US$70/bls (4) oil price 2020: US$100/bls
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Sectoral ConsumptionSectoral Consumption
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Electricity SectorElectricity Sector
Transmission
Generation = JPS + IPPS
DistributionTransmission
Generation = JPS + IPPS
Distribution
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Net Generation TrendsNet Generation Trends
2006 2007 2008 2010** 2020**
Net Generation (‘000 MWh)
4,043 4,079 4,133 4,270 5,340
Losses (% of net) 23 22 24 20 18
IPP Grid Contribution (%)
33 31 30 30 30
Renewable Energy Grid Contribution (%)
5 5 5 ** 10 15
Note: ** Projections guided by trends and Acres ReportSource: JPS and Acres Management Consulting
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Electricity Sector PrioritiesElectricity Sector Priorities• Sector monitored by the regulator (O.U.R.)
– JPS compliance– Recommendations from All Island Black-out Studies– Established standards and directives from the regulator.– Implementation of National Integrated Electricity
Expansion Plan and Efficiency Study for Jamaica (Acres Report)
– Least Cost Expansion Plan– Tariff reviews for electricity rates– Electricity License
• Electricity Supply Strategy & Planning including renewable energy
• Examine impact of energy efficiency and conservation
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Electricity Sector Priorities cont’dElectricity Sector Priorities cont’d
• Generation– Establish and implement a programme to
monitor the efficiency of power generating units
– Fuel use and power generation
• Transmission• Distribution• Assess Infrastructure Performance• Merit Order Dispatch• Shifts in peak demand
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Energy Modeling,Energy Modeling, Planning Planning
and and Policy Guidelines Policy Guidelines
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MODELING
MODELING
LEGISLATIVE FRAMEWORK
LEGISLATIVE FRAMEWORK
POLICYPOLICY
Supporting Structures
ENERGY
E = MC2
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Energy Policy (Green Paper)Energy Policy (Green Paper)• Elements of Energy Green Paper 2006 – 2020
– Energy supply and security – Petroleum Industry– Electricity Sector– Rural Electrification Programme– Transportation Sector– Development of Renewable Energy Resources– Energy Conservation and Efficiency– Energy Fund– Institutional Arrangement
• Green Paper addenda– Energy Conservation and Efficiency Policy: 2008-2022– Bio-fuels Policy
• Ethanol Policy– Electricity Policy– Net Metering Policy– Carbon Trading Policy
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ModelingModeling• ENPEP (Energy and Power Evaluation Programme)
– Utilizing the BALANCE Module of ENPEP– Training & workshop– Stakeholder consultations/collaboration
• JPS, NEPA, PCJ, JBI, Petrojam, SIRI…– Petroleum market biased– Energy Sector Strategy and Development Plan Report
• WASP-IV (Wien Automatic System Planning Package)
– Training– Electricity sector biased– Generation planning
• T21 Model (Threshold 21)
– Training and workshop– Integrated development model– Examines the economy, society and environment
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What is ENPEP-Balance?What is ENPEP-Balance?
• One of approximately 8-10 other models by Argonne
• ENPEP-BALANCE is a nonlinear equilibrium model
• Simulation approach allows ENPEP-Balance to determine the response of various segments of the energy system
• Relies on a decentralized decision-making process• Creates an equilibrium model represented by the energy
network.
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ENPEP Energy System EquilibriumENPEP Energy System Equilibrium
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To simulate the energy market and determine the energy supply and
demand balance over a long-term period of up to 75 years.
For Jamaica’s case, the period
2005 – 2030 is used.
Main Objective of ENPEP ModuleMain Objective of ENPEP Module
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Major CharacteristicsMajor Characteristics• Applications
– Energy policy analysis– Energy market projections– Natural gas market analysis– Carbon emissions projections– Projections of criteria pollutants (SO2, NOX, etc.)– Carbon mitigation studies
• ENPEP features– price-elastic demands– fully integrated economic cost calculations– enhanced error reporting– visible structure created
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Jamaica Energy NetworkJamaica Energy Network
A complete energy network for a country or region may consist of a large number of sectoral energy networks. Jamaica’s network topology includes various sectors*:
*The Ministry established an “ENPEP Working Committee” to modify the existing network and present a network topology that is highly reflective of existing energy systems.
• Refinery • Oil Distribution• Electricity Generation• Distribution• Imports• Sugar Industry
• Bauxite Industry• Domestic Energy Market• Residential Consumers
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Electricity NetworkElectricity Network
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Sugar Industry NetworkSugar Industry Network
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Refinery NetworkRefinery Network
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Limitations of the ModelLimitations of the Model• Solution generated year-by-year and is said to be
“myopic”, which for short term oriented energy market may actually be an advantage.
• Demand-driven
• Not set up with sufficient detail
• Can be insensitive to price
• Ease of use in the Windows interface conceals the sub-models.
“ENPEP-Balance is a tool – and a tool should be used wisely”
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ENPEP SummaryENPEP Summary• Framework for developing institutional capacity
– government and non-government organizations– agencies
• Model is adaptable and can be viewed as a planning tool– developing the country’s long-run energy strategy– generating scenarios according to user specifications– necessary to informing policy decisions.
• Jamaica’s case study created an appropriate energy network– Analyses both energy and environmental systems
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Energy ConservationEnergy Conservation and Efficiency and Efficiency
Projects and Activities
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HotelsHotels
• Energy audits
• Lighting efficiency improvement
• A/C efficiency improvement • Steam system efficiency
improvement• Power factor correction• Solar water heater installation
IndustryIndustry
• Use of cogeneration systems• Use of high efficiency electric
motors and variable speed drives
• Power factor correction• Use of high efficiency industrial
lamps• Steam system efficiency
improvement
Public SectorPublic Sector
• Energy audits• Implementation of energy
efficiency measures in hospitals and schools
• NWC (approx. 50% of the public sector consumption)– Installation of energy
efficient pumps– Power factor correction
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Projects and Activities cont’dProjects and Activities cont’d
• Energy conservation programmes
• Public education programmes– Turning off lights when not in
use
– Water saving measures
– Proper use of refrigerators and freezers
• Energy saving cookware and cooking tips
• Compact fluorescent bulbs
• Use of solar water heaters
ResidentialResidential TransportationTransportation
• Promotion of car pooling where applicable
• Public education programmes– Driving to achieve maximum
fuel efficiency
• Rehabilitation of the railway system
• Introduction of bio-fuels
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WayWayForwardForward
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IncentivesIncentives• Collaboration with other Ministries and agencies
– Ministry of Finance and the Public Service– Ministry of Transport and Works– Bureau of Standards– NEPA
• Expansion in tax exempted items– Renewable energy systems
• Solar water heaters, biogas plants and generators…– Energy efficient equipment and devices
• CFL bulbs, energy management and control systems…– Transport Sector initiatives
• Flexi-fuel vehicles• Hydrogen powered vehicles• Bio-diesel vehicles
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Energy Sector InvestmentEnergy Sector Investment
• Renewable energy equipment manufacturing– Solar panels
• Hydro stations• Wind farms• Bio-fuels production & distribution• Sustainable energy programs
• Nuclear Energy?– Small Nuclear Plants existing– Waste Disposal (an issue)
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Energy Sector Investment cont’dEnergy Sector Investment cont’d
Refinery Upgrade ProgramRefinery Upgrade Program
Oil and Gas ExplorationOil and Gas Exploration
• Expansion of the plant capacity/throughput from 35,000 to 50,000 barrels per day
• Upgrade to address some challenges facing the refinery– Old Technology: Hydro-
skimming– New product specification – Inability to supply all local
market demand
Facilitation of Natural Gas Supplies
Facilitation of Natural Gas Supplies
• LNG
• CNG
• Blocks to be explored
• Companies involved
• Existing agreements (production sharing)
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Legislative and Regulatory FrameworkLegislative and Regulatory Framework
• The Office of Utilities Regulation Act
• Electricity– All-island Electricity Licence– Electricity Lighting Act
• Petroleum acts and regulation– Petroleum Quality Control– Petroleum and Oil Fuel (Landing & Storage)– Weight and Measures
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Environmental ConsiderationsEnvironmental Considerations• Waste disposal
– Conversion of waste to energy
• Promotion of renewable energy– Less toxic– Reduced threat of water
quality– Decline in emission
levels (C02, NOX…)– Carbon credits
• Carbon tax• Emission levies
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Concluding RemarksConcluding Remarks
• Energy security crucial
• Conservation and efficiency initiatives are key
• Goals can be met with timely and requisite investment
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Ministry of Energywww.men.gov.jm
Petroleum Corporation of Jamaicawww.pcj.com
OLADEwww.olade.org.ec
Argonne National Laboratorywww.dis.anl.gov
International Atomic Energy Agencywww.iaea.org
For Further InformationFor Further Information
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Contact Info:Contact Info:
The Ministry of Energy36 Trafalgar Road,Kingston 5, Jamaica, W.I.Tel. #: (876) 929-8990-9Fax #: (876) 968-2082
Email: [email protected]
Thank You… The EndThank You… The End