PS Energy Presentation to at NTC June 2012.pdf

7/27/2019 PS Energy Presentation to at NTC June 2012.pdf

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TACKLING THE ENERGY CHALLENGE

IN UGANDA FOR SOCIAL ECONOMIC

DEVELOPMENT

resentat on

by

F. A. Kabagambe Kaliisa

Permanent Secretary

Ministr of Ener and Mineral Develo ment

1

at

17th National Technology Conference,

Golf Course Hotel, Kampala

15th June, 2012

OUTLINE OF PRESENTATION

1) Introduction

2) The Energy Challenge

3) Measures Put in Place to Address the EnerChallenge:

Appropriate Policy, Legal and Institutional Framework

Introduction of a Strategy with a Mix of Energy Sourcesfor Power Generation.

Rural Electrification Program

Power Loss Reduction Program Energy Efficiency Program

Strategies for Improving Efficiency in use of BiomassEnergy

4) Conclusion


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1.0 INTRODUCTION

Energy is the lifeblood of our day to dayactivities and our economy, Ener is needed for cookin trans ort

lighting, industries, social services, etc.

Energy, Economy and the Environment(E3) have very complex relationships. A perfect balance between three leads to

sustainable development.

Unsustainable exploitation and utilization of

energy is contributing to global warming andclimate change.

3

Energy and National income

and consumption per capita

Ugandas has a low GDP that is partly driven by energyconsumption reason for being above the line.

The Agriculture sector that contributes to our GDP is notenergy intensive 4


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Policy Simulations conducted on poverty

reduction 13 Experiments were conducted Pur ose: To redict, in advance, how the overt rate

would change as a result of various policies.

Impact is measured in terms of:- Consumption: percent change from status quo in

2002/2003

Poverty: change in percent points as compared to officialovert rate in 2002/2003

5

Looking at the impact of rural electrification, increase in

family size, improvement in Education, health servicesand transport we note the following:

Policy Simulations

PolicyPolicy % change in% change inconsumptionconsumption

Change inChange inpoverty ratepoverty rate

Electrify communitiesElectrify communities 7.37.3 -- 9.39.3

Halve distance to communityHalve distance to communityservicesservices

2.62.6 --3.03.0

Road within 1km of villageRoad within 1km of village 0.20.2 --0.30.3

6

centecenteOne more adult female whoOne more adult female whocompleted sec schoolcompleted sec school

10.810.8 --8.28.2

Add child if household alreadyAdd child if household alreadyhas at least onehas at least one

--11.211.2 10.810.8


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Conclusion from the Simulations

Increase in household families greatlyncreases pover y eve s.

If one was to rank the policies as to howthey reduce poverty levels, rural

7

.

2.0 THE ENERGY CHALLENGE Energy projects are capital intensive hence the

need to secure reasonably priced capital for theprojects.

Lack of an energy mix strategy in powergeneration.

Low level of access to electricity (about 16%)

consumption (70 kWh) compare with othercountries, Africa - 580 kWh (Average) Korea 8,500 kWh, South Africa 5,000 kWh andChina 2,400 kWh.

8


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2.0 THE ENERGY CHALLENGE CONTD

High power losses in the power network that has anegative impact on the tariff.

Low level of Energy Efficiency in the utilization ofenergy.

Biomass contributes over 90% of the rimar enerdemand yet its production and utilisation is inefficient

resulting in adverse effects on the environment andhealth of the users.

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3.0 MEASURES TO ADDRESS THE

ENERGY CHALLENGE3.1Challenge: Capitalization of Energy Projects

How it was addressed

.Institutional Framework

i) The Energy Pol icy for Uganda

Goal:To meet the energy needs of Ugandas population for social andeconomic development in an environmentally sustainable manner

Objectives: ,

resources in the country

To increase access to modern affordable and reliable energy services asa contribution to poverty eradication

To improve energy governance and administration

To stimulate economic development

To manage energy-related environmental impacts


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It aims to provide a framework to increase insignificant proportions the contribution of

ii) Renewable Energy Policy for Uganda 2007ii) Renewable Energy Policy for Uganda 2007

.

Main features:

Introduced the feed in tariffs.

11

.

Obligation of fossils fuel companies to mix productswith biofuels up to 20%.

Tax incentives on renewable energy technologies.

ii i) Legal Framework

The Electricity Act, 1999: The salient

ea ures o e c are o prov e e

enabling legislation for:

Liberalising the electricity industry;

Unbundling of the Uganda Electricity Board

,transmission and distribution;

The establishment of Electricity RegulatoryAuthority (the ERA) to regulate the sector;

12


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C. Salient features of the

Act Contd The establishment of the Rural Electrification

un e , w e man o ec ve oenhancing rural access to electricity; and

The establishment of the Electricity DisputeTribunal (the EDT) that has jurisdiction tohear and determine electricit sectordisputes which are referred to it.

13

The Impact of the Reforms Reforms have improved the sector performance

and attracted additional investments which include:

,about US$ 860 M

Over US$ 200 M from Construction of Renewableenergy projects such as Nyagak 3.5 MW Mpanga 18MW, Bugoye 13MW, Buseruka 9 MW, Ishasha 6.5 MWCogeneration 25Mw etc

Generation concession Eskom invested over US $ 10 M

Distribution Umeme Ltd has invested about US $120 M

Additional investments by the Rural electrificationconcessions.

14


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B. The Energy Investment

Fund

the strategic plan, an Energy Fund wasestablished to enable government tospeed up investments in hydro powerprojects and the associated infrastructure.

Money from the treasury is put into the

fund annually.

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3.2 Challenge: Lack of an Energy Mix

Strategy to Ensure Energy SecurityHow it was addressed: Strategic Plan prepared which

had various energy sources in the Generation Mix.

Background Information

In 2006, Government prepared a plan to meet theshortfall in power supply in the Short term, Mediumterm and long-term.

The broad objective was to provide adequate and

. In 2006, the power supply deficit was 90-210 MWnecessitating a 24 hr load shedding rotating Rota.

The acute electricity supply shortage did negativelyimpact on GDP which dropped from an average 6.5%over the last 10 years to 5% in 2005/2006.


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Strategic Plan for Increasing

Generation Capacity

a e s ora e s or -- erm measures :erm measures :--

Procurement of Thermal Generation Capacity.

Energy loss reduction: This involved an

system.

Energy Efficiency/Demand Side Management.

17

b) Medium-term Plans (2006/07

2010/11)

Development of the Bujagali Hydroelectric Project(250MW).

Development of the Karuma Hydroelectric Project(600MW).

Use of indigenous petroleum resources for thermalgeneration

Renewable Energy Generation Projects. Use of Solar Photo Voltaics (PV) and Solar Water

. Use of Biogas, improved efficiency stoves to cater forrural energy requirements and production of electricityfrom municipal waste for sale of power into the gridwill be enhanced.


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c) Long-term Measures (2012

2025):-

The development of large hydro power sites,,

2020 and Uhuru (300MW)

Interconnection of the regional power grid;

Use of new (like geothermal) and renewablesources of energy as well as biomass, like peat.

Use of fossil fuels locally produced to generate

thermal power

3.2 Progress Made on the Implementation of

the Plan

A. Short Term Measures

1. Emer enc and other Thermal PowerProjects

A total of 170 MW was procured. 50 MW Aggreko at Kira in J inja which was decommissioned

last year. 50 MW high speed diesel plant at Mutundwe which was

decommissioned this year after Bujagali Hydropower plant

starte operaton. J acobsen As installed a 50 MW Heavy Fuel Oil (HFO) plant

on a Build Own Operate and Transfer (BOOT) basis atNamanve in the Industrial Park. In future this plant will uselocally produced heavy fuel oil.

20MW with HFO at Tororo by Electromaxx 20


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A. Short Term Measures contd

2. Im rovin efficienc of electricit consum tionthrough adoption of the Compact FluorescentLamp (CFLs)

Replacement of 800,000 incandescent Lamps withCFLs reduced the peak demand by 30 MW.

. .program was implemented which has been reduced

the losses from 36% to 27%

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C. Progress on Medium-term

Measures

Status of the Bujagali Project

Bujagali plant of 250 MW is being developed byBujagali energy Limited (BEL) as a private developer.

Bujagali is now delivering 150 MW aftercommissioning 3 units, a measure that has done awaywith load-shedding.

The fourth unit will be commissioned in J une and the

last one in J uly 2012 when the plant will be ully The uninterrupted power supply is expected to

enhance economic activities and has reduced on theuse of expensive standby diesel and petrolgenerators. 22


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Aerial View of the

Bujagali Project

23

Installation of Unit 5

24


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D. Other Projects being

Developed - Medium Term

Construction of Karuma (600 MW) power plant as a

completing the procurement process of an EPCcontractor. This plant is expected to becommissioned in 2017.

Feasibility studies for Isimba (140 MW) will be.

the private sector. It is also expected to be

commissioned around 2017.

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Ayago Hydropower Project (600):

The prefeasibility studies were completed in 2011.

Full feasibility studies started in April 2012 to becompleted next year.

Project to be developed as a Public PrivatePartnership.

26


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E. Renewable DevelopmentStatus of Development Mini hydro

Power PlantsProject Status

Mpanga Mini Hydro (18 MW) Operational

Ishasha Mini Hydro (6.5MW) Operational

Bugoye Mini Hydro (13 MW) Operational

Mobuku I (5 MW) and Mobuku III

(9 MW) Mini Hydros,

Operational

Buseruka (10 MW), Commissioning expected early, 2012.

Maziba (1 MW) Under rehabilitation.st

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yaga . omm ss on ng expec e n uar er, .

Kikagati (16 MW) Feasibility studies completed construction soon

to commence.Nyagak III (4MW), Olewa I (0.6MW)

and Olewa II (0.6 MW)

Feasibility studies completed.

E. Renewable EnergyDevelopment Contd

Detailed feasibility studies for a number of sites

implementation once negotiations with UETCLand Government are complete. These include:Mitano (2.9 MW), Lubilia (5.4 MW), Nyagak III (3MW); Siti (22 MW), Waki (5.4 MW),Ndu utu 0.5 MW , N amwamba 14 MW ,

Nengo Bridge (7.5 MW) and Esia (0.11 MW).

In addition, an EPC contractor is being procuredto undertake the rehabilitation Maziba (1 MW).

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E. Renewable Energy

Development Contd

In addition, feasibility studies for other sitesver suc as s ungyez ,

Ntono (2.5 MW), Kakaka (7.2 MW), Muyembe(10 MW), Kyambura (8.3 MW) and Musizi (20 MW)are in their final stages.

ona power w e rom ogenera on o esugar factories that have a potential to add anadditional 75 MW to the national grid.

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F. Transmission Projects Medium Term

A number of transmission lines have been earmarkedto evacuate power from the generation plants and

.include:

Nkenda Mputa Hoima (132KV, 254km);

Karuma Kawanda (400KV, 264 km);

Karuma Olwiyo (132KV, 60km);

Karuma Lira (132 KV, 80km);

Karuma-Gulu (132KV, 70km);

Isimba interconnection (132KV, 40km);

Kawanda Masaka (220KV, 142km). 30


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F. Transmission Projects Contd:

Kampala Entebbe (132KV);

rama a a e ;

Hoima - Kafu (132 KV);

Lira Gulu Nebbi (132 KV);

Opuyo Moroto (132KV, 200km);

Tororo O u o Lira u rade 132KV, 260km ;

Mbarara Nkenda (132KV, 160km) and

Lira-Kitgum(132KV, 125km).

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3.3 Challenge: Low level of

access to Electricity

How it is Addressed: Rural Electri fication

Pro ramme ut in Place

The country rural electrification program aims toachieve coverage of at least 10% in the ruralareas after ten years.

The program is targeting district headquarters,

pro uc on areas o suppor grcu uramodernization, socially desirable areas likeschools, health centres, water supply facilities andtrading centres which provide services to the ruralpopulation. 32


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3.4 Challenge: High System Losses

How it is addressed: Power System Loss Reduction Program

Total power system losses in the in the distribution networkhave reduced from 36% in 2008 to about 27% by end of 2011.

The commercial losses (power thefts) pose the biggestchallenge.

Umeme and Government have come up with a strategy toreduce the losses to about 17% by 2016. The measuresincludes:

35

Tacking issue of power theft

Introduction of Pre-Payment Meters Use of Low Volt Aerial Bundle Cables (ABC)

Introducing Automated Meter Reading (AMR) for large customers

Eliminating unmetered customers

3.5 Challenge: Low level of Energy

EfficiencyHow it is Addressed: Energy Effic iency

Program in Place

.

Energy Efficiency Week an annual event. Mainactivities:

Media campaigns to create awareness in the Public.

An exhibition of Energy Efficient and Renewable Energy

(2011), Mbarara (2010), Kampala (2009), J inja (2008),Kampala (2007), Kampala (2006), Kampala (2005).

Road shows promoting Energy Efficient and RenewableEnergy technologies


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B. Energy Audit ing

Energy audits are carriedout at the different levels

Energy Audit at SouthernRange Nyanza Ltd

aimed at identifying areasof improving efficientutilization of energy &cost reduction:

A number of firms havebeen audited:-Hima

,Nyanza Ltd, Nile

Breweries, UgandaBreweries Ltd, SteelRolling Mills Ltd, CrownBeverages Ltd, BritaniaLtd, Mukwano, etc.

Case Study : Hima Cement

Energy EfficiencyImplemented

Energy Audit conducted inHima cement. The Audit made

.

Investment Cost in EnergyEfficiency improvements was,U Shs. 1,160 million.

After investment, the annualEner savin s was

i) 1,278,000 kWh

ii) 636,000 litres of furnace Oil

Annual Savings, Ug Shs.

= 565 million

Payback Period= 2yrs


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D. Energy Audit in Public

Institutions The latest energy audits wereconducted in 6 public

Installing solar heater to

universities, 105 public school& collages, 24 referralhospitals, 10 National Water &Sewerage Corporation waterpumping facilities, KCCA streetLighting and 20 public building.

Energy efficiency investments

a referral hospital

institutions with an anticipation

of saving 10 GWh of electricityannually.

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E. Energy Efficiency Legislation

The Ministry is working on an Energy Efficiency and

use, development, promotion, and commercializationof sustainable and efficient energy technologies.

In addition, the ministry working together with UNBSare developing energy efficiency standards for

, ,motors, energy savers and fluorescent tubes.

The main objective of introducing energy efficiencystandards is to eliminate inefficient appliance onUgandan market. 40


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3.6 Challenge: Predominant role of

Biomass in the Primary energy supply

How it is Addressed: Strategies for promotingEfficienc in the use of Biomass Ener utin place:

The ministry is promoting the use of efficienttechnologies such as improved charcoal andhousehold cook stoves and Improved Institutionalcook stoves. These use less than 50% wood fuelin com arison to the traditional coo stoves.

In addition, there is training of artisans in

constructionof improved cook stoves. Plantation of trees to provide for wood fuel. Wood

lots has been encouraged for all families.

a) Improved Household Stove

Lorena Stove is moreefficient saving 50-60%of the fuel used by anopen fire

Hardly produces

during operation

Easy to operate

Environmentallyfriendly


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b) Energy Efficient Charcoal

Stoves Promoted

stoves can savemore than 50% ofwood consumptionneeded for cooking.

They are built from.

Cost is about Shs15,000 20,000 foran average size andis recoverable in averyshort time.

Traditional Metal J iko

stove mostly usedin urban areas.

It is cheap butwastes a lot ofener


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c) Promotion of Efficient InstitutionalStoves

Institutional stoves cansave more than 50% of

needed for cooking.

They are free fromsmoke which isresponsible forrespiratory diseases

45Institutional Stove constructed in one of the Prisons

pollution.

d) Use of Biogas as an Alternative

Sources of Energy Biogas is another key energy resource that is being

promoted as an alternative to wood fuel.

was a big potential of over 200,000 digesters acrossthe country.

Biogas can be obtained from any other digestiblematerial such as cow dung, pig dung, chickendro in s, oat dro in s, human waste etc.

There is a programme to disseminate biogas in thecountry coordinated by Heifer International with theMinistry support.


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4.0 CONCLUSION

The key energy challenge in Uganda is centered aroundlack of a mix of energy sources in power generation, lowlevel of access to modern energy, inadequateinfrastructure for eneration transmission and distributionand low level of energy efficiency.

To address this, Government has prioritized EnergyDevelopment as a high level issue for the country and asa result considerable investment is being channeledtowards development of energy infrastructure.

Governments plan to provide adequate and reliable

Bujagali hydropower project underway and development

of large hydro and several renewable energy projectsunder development. With the development of the sector and increased access

to modern energy services, the country is bound toexperience increased social economic development.

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Thank You for Your Attention !! !

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PS Energy Presentation to at NTC June 2012.pdf

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