Renewables

New Administration, New Hope for Geothermal Energy?

28 October 2019

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Indonesia

A decision by Perusahaan Listrik Negara, or PLN, the state utility company, to ink a new investment deal for a coal-fired power plant in Suralaya, Cilegon, this year has raised some eyebrows. The power plant, which will be operating under a PLN subsidiary, would increase the total installed capacity of Suralaya Power Plant by up to 6,025 megawatts.

While this will be a significant contribution to President Joko “Jokowi” Widodo’s 35,000-megawatt target (around 20 percent of the power supply in Java and Bali), the decision has put another question mark over his administration’s already sluggish commitment to renewable energy.

The current government’s ambition for renewable energy is lacklustre to say the least. By 2050, still more than half of our energy mix will come from fossil fuels. This is especially ironic for Indonesia, a country with enormous potential for renewable energy but still almost totally ruled by a dependence on fossil fuels.

Turning a blind eye to the International Energy Agency’s (IEA) finding that carbondioxide emitted by coal combustion contributes more than 0.3 degrees of the 1-degree Celcius increase in average global temperature, we plough on boosting our coal consumption and export.

Domestically, we consumed no less than 115 million tons of coal in 2018, keeping to the trend of a 10-percent increase per year since 2014. In the same year, we also exported more than 300 million tons of coal. Meanwhile, our dependence on oil and gas continues unabated.

Reliable Resource

Considering our enormous reserves of natural resources, we should not be grasping at straws to escape the dire cycle of fossil fuels.

One resource that should be our champion of renewable energy is geothermal.

A rough calculation of our geothermal potential offers an intriguing prospect: 75 percent of Jokowi’s 35,000-megawatt target can be fulfilled by geothermal energy alone.

Although more explorations are still needed to prove the number, optimizing geothermal energy may be our best bet to finally get rid of fossil fuels.

Geothermal energy is mined by extracting underground hot steam from magma activity below the earth’s surface. Indonesia, located in the world’s center of volcanic cracks, is endowed with an abundance of high enthalpy (high potential) hot steam. It is said that 40 percent of the world’s geothermal reserves are stored in our archipelago.

This seems to be a good enough reason to start optimizing geothermal energy, but there are still more benefits.

First, reliability. Unlike many renewable resources, geothermal is energy you can depend on. While power generation from solar or wind energy might be weather-sensitive, geothermal power generation works relatively uninterrupted. This also makes power generation from geothermal resources more calculable.

Geothermal energy also has multiple uses. Though mainly used for power generation, hot steam can also be used as a greenhouse heater in the agriculture industry or in hot springs for the tourism sector.

Geothermal energy is also a clean energy resource. A geothermal power plant emits 97 percent less carbon than a coal-fired power plant of the same capacity.

Where’s the Commitment?

Early this year, Jokowi opened another coal-fired power plant in Cilacap, Central Java. New fossil-fuel power plants keep springing up on the island of Java, even though the country’s power grid is more scarce outside it.

However, there might be hope still. When Jokowi introduced his new energy minister – Arifin Tasrif – last week, he expressed a renewed interest in renewable energy as well as an intention to reduce oil and gas import.

It might not mean much in the end, but the reality is that any attempt to escape the fossil fuel cycle requires commitment from the highest level of government.

This commitment should be translated into strict regulations, incentives for renewables development and strong law enforcement.

Renewable energy may cost an arm and a leg to set up, but it does not have to hinder Jokowi’s investment ambitions, it may actually benefit them.

Industries are one of the biggest consumers of energy, and hence cheap and reliable electricity is often seen as one of the main magnets for investment.

Sure, businesses can now still rely on fossil fuels, but sooner or later they will need sustainable energy resources to maintain the continuity of their investment.

RE100 is one proof that businesses are starting to jump on the renewable energy bandwagon. It is an initiative by multinational companies (IKEA, Nike and Apple are part of the movement) to use only renewable energy resources for their worldwide assets.

If Jokowi wants to increase investment, this is his chance to distinguish Indonesia from other emerging markets: by leveraging Indonesia’s geothermal potential and dangling the carrot of cheap and reliable energy to investors.

Special Incentives

The first thing to do for the government is to provide special incentives to build new geothermal power plants.

Geothermal exploration is high-risk and expensive. High exploration costs can lead to very thin profit margins. The sector becomes even more unattractive when there are no adequate incentives to develop new geothermal power stations.

Subsidies, in the shape of premium pricing for renewable resources and high carbon taxes for fossil-fuel power plants, can be issued through government regulations.

The government can also show support by issuing special licenses to clarify overlapping rules which often turn into huge roadblocks in power station development.

The reality at the moment is geothermal energy remains an underdeveloped sector. Government incentives might turn things around but only if they are backed up by strong commitment from the highest level of the administration.

Electricity/Power Grid

Power Up: Indonesia’s New Capital Needs New Electricity Grid

28 October 2019

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Indonesia

Jakarta. Indonesia’s new capital in East Kalimantan will need additional 1,555 megawatts of electricity to ensure an uninterrupted power supply, according to the Energy and Mineral Resources Ministry.

The extra capacity needed is around what the entire island of Kalimantan consumes in electricity today, but the government is adamant it does not want a repeat of Jakarta’s embarrassing blackout two months ago.

Rida Mulyana, the director general of electricity at the ministry, said electricity connections in the new capital ideally should have zero downtime and a minimum of three layers of power supply.

The system should employ a circular smart grid with plenty of storage connected to high, medium and low voltage networks using underground cables.

Ideally, the power should come from renewable sources and there should be plenty of recharging stations for electric vehicles, according to Rida.

“We need around 1,196 extra megawatts in the new capital, which means we need a new power plant with a capacity of at least 1,555 megawatts,” Rida said over the weekend.

The new power plant’s inflated capacity accounts for a reserve margin of 30 percent to cover instances when electricity demand jumps above the typical peak load.

The so far unnamed new capital, located in the districts of North Penajem Paser and Kutai Kertanegara in East Kalimantan, will not be able to rely only on Kalimantan’s current power grid, Rida said.

The government expects to start construction on the $33-billion new capital next year and finish it in 2024.

But Perusahaan Listrik Negara (PLN), the state-owned utility company, only has a plan to add 691 more megawatts to the country’s current power grid, according to its 2019-2028 Electricity Supply Business Plan which was passed by the government in February before the decision to move the capital was taken.

Rida suggested the plan might soon be amended. “We need to speed up development of electricity infrastructure — power generation, transmission, distribution — to make sure the new capital has a reliable electricity network,” he said.

East Kalimantan currently receives its electricity from the Kalimantan Interconnection System, a grid combining power from powerplants in three provinces, East, South and Central Kalimantan. The system has a total capacity of 1,569 megawatts with a typical peak load of 1,095 megawatts.

As of July, virtually all residents of East Kalimantan, including those in North Penajam Paser and Kutai Kartanegara, have access to electricity, with PLN’s power coverage in the region nearing 99.9 percent.

Electricity/Power Grid

Myanmar rushes power plant projects to avoid more blackouts

28 October 2019

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Myanmar

YANGON — Myanmar’s government is trying to address the country’s worsening power shortage, aiming to add 1,072 megawatts of new electricity generating capacity ahead of elections in late 2020.

The move reflects concerns about growing public dissatisfaction over crippling power blackouts and price increases to help fund a string of power plant projects.

The energy ministry announced on Wednesday that a consortium led by VPower Group, a Hong Kong-listed company with close links to Chinese state-owned enterprises, including CITIC and train maker CRRC, had won bids for four out of five of the emergency projects, totaling 920.54 MW.

Three plants will be fired with imported liquefied natural gas, while one will rely on gas supplied by the government. For all three LNG projects, with a generating capacity of 900 MW, VPower is partnering with the state-owned China National Technical Import & Export Corporation.

The contract to build the fifth plant was awarded to a Chinese consortium led by another state-owned company, China Energy Engineering Corp. The tender called for a 151.54 MW gas-fired power plant in Yangon.

Letters of acceptance were issued in early September, the ministry said, noting the companies had started “carrying out planning works.” The five projects are expected to produce a total of 1072.08 MW by the summer of 2020, it added.

In the short term, the government, led by State Counselor Aung San Suu Kyi, is betting on these emergency power plants to forestall a repeat of last summer’s severe blackouts. But the growing energy shortfall across the country will hamper that effort until the government can attract more investment into new gas and hydropower stations, and renewable projects.

Myanmar’s electricity charges for households and businesses were raised substantially in July, a move the ministry hopes will help fund its drive to boost electricity supplies ahead of national polls scheduled for November 2020.

“Now that electricity tariffs have increased, people will be less tolerant of power disruptions,” said Pyi Wa Tun of Yangon-based Parami Energy. “If the power projects cannot be done on time, and disruption kicks in next hot season, the government’s credibility would be at risk.”

Critics have questioned the terms of the tender, including the one-month time frame that companies had to prepare and submit bids. The ministry did not give a reason for the tight deadline, despite complaints from the industry that few companies could meet it.

“No reputable power companies will take part in the [tender] process if there isn’t sufficient time,” said Parami’s Pyi Wa Tun.

Jeremy Mullins, country director at regional advisory company Vriens and Partners, cited requirements for the plants to go into operation by next summer as another hurdle.

Other issues for potential bidders include the ministry’s requirement for the use of gas, rather than other fuels, and the unusually short term of the contracts that only lasts five years from the start of commercial operations. For multinational enterprises, the government’s decision to limit payment to local currency was also an issue as many of their input costs, including for LNG, are in foreign currencies, particularly dollars. Hefty daily fines for missing the completion deadline were another problem.

In response to the criticism, a VPower spokesperson told the Nikkei Asian Review that the company is “a specialist in fast-track distributed power generation,” and pointed to its “timely delivery of reliable electricity to Myanmar since 2015.”

If successful, the four new projects will put VPower’s total generation capacity in Myanmar at 1,280 MW, more than a third of the country’s dry-season available capacity, which stood at around 3100 MW in 2018, according to ministry estimates.

About 40% of Myanmar’s people have access to electricity, which is currently produced by 20 gas-fired and 62 hydropower stations, and one coal-fired plant. Demand is rising by 15% to 16% a year, according to official data.

Aung San Suu Kyi’s administration has developed little new generating capacity since taking office in 2016, with most new projects initiated by the previous Thein Sein government. Likewise, the hydropower sector has attracted virtually no foreign investment under the new government.

Preliminary agreements were signed previously with utility companies from France, Norway, Austria and Singapore, to build dams for hydropower projects, but no progress has been announced. An executive with one developer blamed the energy ministry’s reluctance to open up the sector to foreign companies. Local players have limited experience building power stations, he added.

The ministry has recently been dogged by corruption allegations. Two senior ministry officials involved in hydropower policy were charged by Myanmar’s Anti-Corruption Commission in September. The watchdog continues to investigate the ministry, but has not said what it is looking into.

In other efforts to increase energy supplies, Myanmar hopes to step up exploration in offshore gas fields. Domestic use of gas from these fields is limited by export contracts that Myanmar has with Thailand and China. In 2017-18, these shipments were worth around $3.1 billion, roughly half Myanmar’s total export revenue.

The government plans to hold an international bidding round this year for gas concessions, the first since 2013-14, releasing 15 offshore and 18 onshore blocks. But the bidding has been delayed, likely because the ministry wants to enact relevant legislation, according to another industry insider.

NORTHEN THAILAND

Electrical Authority Prepares to Shut Down Mae Moh Coal Mine

Turn the coal mine into a smart city.

coal mine

Mr Tawatchai said Egat may pursue reforestation to help the environment while setting aside some areas for locals to make a living.

With some analysts have advised the authority to turn the coal mine into a smart city, he said any new developments must be compatible and in harmony with locals’ lives.

The lignite coal mine has been the only coal resource for the Mae Moh power plant since 1978. Operated by Egat. This Norther Thailand mine is also the largest coal mine in Thailand.

The coal mine has not supplied underground coal reserves for more than a decade.

coal mine

“Some people proposed making a large reservoir out of part of the coal mine to serve local irrigation. With others proposing floating solar photovoltaic panels on the reservoir,” said Mr Tawatchai.

Some areas of the mine have been allocated for other activities the Bangkok Post reports. Such as the annual Mae Moh winter festival, held during Nov 22-24.

The event has been held for 15 years and is a major tourist draw.

coal mine

More than 300,000 tourists are expected to visit this year’s event, up from 200,000 last year. Which generated more 300 million baht in income for locals. This year 500 million baht is also expected to be generated.

He said national lignite production has peaked and Egat is preparing to redevelop some retired power-generating units. In line with declining lignite output.

Egat also runs 13 generating units at Mae Moh, producing 2,400 megawatts for units 4-13. Units 1-3 were decommissioned during 1999-2000.

The Mae Moh plant can supply 50% of electricity to the North

coal mine

The Mae Moh plant can supply 50% of electricity to the North, 30% to the central region and 20% to the Northeast.

“Only 10 units are in operation and some are scheduled to retire over next five years,” said Mr Tawatchai.

In July, Patana Sangsriroujana, Egat’s deputy governor for policy and planning, said Egat is proceeding with a repowering plan for Units 4-7, constructing generator replacements.

The replacement of Units 4-7 and the repowering project was approved by the government on Aug 19, 2014. The four units had a combined capacity of 560MW.

Oil & Gas

Philippines pushes 60-40 sharing for oil with China

26 October 2019

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Philippines

MANILA, Philippines — The government would pursue a 60-40 sharing scheme with China once talks start anew this month for the exploration of oil in the West Philippine Sea, National Security Adviser Hermogenes Esperon said yesterday.

In a press briefing at Malacañang, Esperon said the 60-40 sharing scheme in favor of the Phlippines was “fair” enough since China would spend for the exploration.

“That’s the net because they will spend for all the extraction and all other things,” he said.

“(The) 60/40 (sharing scheme) is a desirable sharing, but it is not final. It could even go up to 61 or more. One percent is always substantial when you talk about such big investments,” Esperon said.

Esperon said the Philippines and China have already formed the joint steering committee to work on the deal.

“And shortly there will be talks with China in pursuance of the earlier memorandum of understanding that was signed in 2018 for the development of this energy fields,” Esperon said.

The Philippines and China have signed a memorandum of agreement on joint exploration for oil and gas in the West Philippines Sea during the state visit of Chinese President Xi Jinping last year.

In the same briefing, Esperon said the Philippine government is also lifting the moratorium on the conduct of maritime research surveys by foreign firms in the country’s vast waters.

Esperon said that the sharing scheme is acceptable, and it may even increase to more than 60 percent, during negotiations. The Malampaya project would be a good working sample for the next oil explorations.

“This is an altogether, a new agreement and a new process. But, it will look very similar to what you have now in the Malampaya, where you have corporations joining our own corporation,” he said.

According to Esperon, the Department of Foreign Affairs will be the chairman of the steering committee which counts the Departments of Energy and of the Environment and Natural Resources, among others as members.

To illustrate that the Philippines can strike oil exploration agreements in other parts of the West Phlippine Sea, Esperon also cited that Forum Energy Ltd, contractor of the Service Contract 72 in the Reed Bank as “already being there.”

“They are already there, we are talking about the areas near Recto Bank and several of them are already there. Such as, Forum Oil. It’s participated in by Manuel Pangilinan,” he said.

Read more at https://www.philstar.com/business/2019/10/26/1963345/philippines-pushes-60-40-sharing-oil-china#4D6OfDRFprQ0Whfa.99

Others

Let’s move from 3R to 7R

26 October 2019

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Malaysia

Notwithstanding the current cooler spell, Malaysia is hotter than ever before, and the trend shows no signs of reversing to the temperatures enjoyed by Malaysians over the last few decades.

This fact was also acknowledged by Prime Minister Tun Dr Mahathir Mohamad in his speech at the 74th session of the United Nations General Assembly (UNGA) in New York last month.

He had urged the global community to pay serious attention to combating extreme climate change. He also highlighted the importance of survival initiatives, such as alternative shelter and food production, in case of a calamity.

Indeed, a majority of countries are experiencing the drastic effects of climate change, as evident from UNGA where almost all leaders brought up the issue.

Most climate scientists agree that human activity is the leading cause of global warming, which in turn triggers climate change. Previously, the natural emission of carbon dioxide (CO2) was the most significant factor in global warming as it formed the largest concentration in the Earth’s atmosphere compared with other greenhouse gases (GHG).

However, human activity stemming from industry, energy production, transportation using carbon-based fuels, and the sum of agricultural activities, food production, land-use and forestry now contribute up to 29 per cent (i.e. more than one-fourth) of the total global GHG emissions.

In this regard, the world needs to shift its attention to sustainable resource management and development practices to curb climate issues.

The transition from fossil fuels to renewable energy has taken place in many developed and developing nations, reducing their carbon footprint.

Among the progressive measures has been the increase in facilities for renewable energy, including solar farms, wind turbines, biomass and hydroelectric plants — creating a sustainable “energy mix” ecosystem. In addition, “energy efficiency” and “energy conservation” practices were also introduced.

Energy efficiency requires consumers to invest in equipment that can operate with less energy for the same or more load, while energy conservation requires consumers to reduce the use of electrical appliances.

These measures can save natural resources from depletion, keep the environment free from pollution, and save some money in the long run.

The best environmentally friendly activities include the 3R practice of “reduce, reuse, and recycle”. Some might extend this idea up to seven (7R) in a circular flow — rethink, refuse, reduce, repurpose, reuse, recycle and rot.

These ideas are commonly applied to daily products or consumables, but the concept can also be applied to other human activities such as transportation. For instance, first, we should rethink whether or not it is necessary to drive fast and recklessly. Driving fast will consume more fuel, release more carbon and might put other people at risk. As a result, the second step would be to refuse to make it a practice.

Third, we should reduce our driving activity by prioritising what is important or at least make the most out of a single trip by accomplishing multiple tasks. Additionally, instead of using a car for a single purpose, a car-sharing practice will make better use of its capacity; this can be considered as repurposing or reusing.

This, in turn, will reduce traffic congestion and pollution, while adding value to the car owner. Finally, as the car reaches a certain mileage, we must plan whether to restore, sell or recycle the vehicle.

Ideally, the process of managing resources will form a closed-loop system; this circularity is aimed at eliminating waste and promoting the continual use of resources — a model known as the circular economy. Unlike the traditional linear economy with the “take, make and dispose” approach that lets waste end up in landfills, the circular economy adopts the “regenerative” approach where “all waste should be food for another process”, inspired from the natural system.

It will mainly involve “reuse, remanufacturing, and recycling” processes. According to the Ellen MacArthur Foundation paper, “Completing the Picture: How the Circular Economy Tackles Climate Change”, switching to renewable energy could cut GHG by 55 per cent, and the circular economy could reduce the remaining 45 per cent emissions mainly from the making of products and food production.

In Muslim countries, the concept of the circular economy has been a subject of rigorous discussion especially by those in the Islamic finance circle. Several Islamic concepts in relation to managing resources and the ecology, such as mizan (universal balance), miqdar (proportion), khalifah (stewardship) and maqasid (purposeful use) are supportive of the circular approach.

These Islamic principles can serve as catalysts, among others, to encourage the Muslim community to live in a sustainable system, thus contributing to the efforts to address the climate issue at the global level.

Energy-Climate & Environment

Young Thais battle seniority culture to raise climate awareness

25 October 2019

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Thailand

BANGKOK (Thomson Reuters Foundation) – When Nanticha “Lynn” Ocharoenchai organized Thailand’s first climate strike in March, more than half of the 50 people who showed up at the rally in Bangkok were students at international schools and expatriates.

The same day, Ralyn “Lilly” Satidtanasarn, then aged 11, and a group of fellow pupils submitted an open letter to the prime minister, calling for urgent action on climate change.

“The fact that Lilly and I can do this draws a lot from being in international schools,” said 21-year-old Lynn.

There they received classes on the environment, whereas most Thai state schools do not teach the subject, Lynn noted in an interview a week after graduating from Chulalongkorn University.

The young pair are often said to be Thailand’s version of Greta Thunberg, the teenage Swedish activist who has inspired other children worldwide to skip school and demonstrate in the streets about the need to halt global warming and its impacts.

Lynn’s mission is to boost awareness among the Thai public about climate change in a country that is witnessing warmer temperatures, sea-level rise, floods and droughts.

Its capital Bangkok, built on the flood-plains of the Chao Phraya River, is expected to be among the urban areas hit hardest as the climate heats up.

Nearly 40% of Bangkok may be inundated each year as soon as 2030 due to more extreme rainfall, according to the World Bank.

But while many Thais are directly experiencing the growing effects of climate change, Lynn said some Asian social norms made it hard for her to achieve her aims.

“In Asia, we have a culture of seniority, and young people aren’t supposed to speak up for themselves and are not supposed to speak against adults,” she told the Thomson Reuters Foundation in a Bangkok coffee shop.

LOCAL LINK LACKING

Lynn’s interest in climate change was sparked through writing articles on the environment as a journalism intern.

In March, she read about Thunberg, which prompted her to create a Facebook event for a climate strike in Bangkok.

“I could truly relate to her frustration and depression, and just feelings of hopelessness,” said Lynn.

“For years I cried in my bedroom, and I’m sad and I’m just like, no one’s going to do anything about it. But I figured if Greta can do it… I can probably do something too,” she said.

Since she set up the Facebook page “Climate Strike Thailand”, it has attracted almost 5,000 followers.

“Initially I had no idea about Thai social media and how to deal with Thai culture and Thai people and changing their mindset, but since March I’ve learned so much,” she said.

Tara Buakamsri, Thailand director for Greenpeace Southeast Asia, said young people in provinces outside Bangkok have long campaigned on environmental issues affecting their home towns, such as opposing gold mines or coal-power plants.

But there has been no networking platform to link them with groups in the capital, and Climate Strike Thailand has yet to spread beyond middle-class and international school students, he added.

“While the recent climate strikes are connected to climate change issues (at) the international level, they have yet to connect on the local level,” said Buakamsri.

‘JUST THE BEGINNING’

Since the first March strike, Lynn has led two more in May and September.

For the third, about 200 young people marched to the Ministry of Natural Resources and Environment, demanding that the government declare a climate emergency and shift to 100% renewable energy by 2040.

In 2015, Thailand signed the Paris climate agreement and pledged to reduce its greenhouse gas emissions by 20-25% by 2030, compared with 2005 levels.

But new coal-fired power plants have since been promoted both in Thailand and neighboring countries, which activists say contradicts climate change goals.

“These climate strikes are by no means methods to solve the problem,” Lynn said. “It’s just the beginning where you acknowledge the problem.”

Lilly, meanwhile, now 12, has been meeting with business and the government, urging them to care more about the environment.

Her persistence over the last two years has paid off, and she is widely credited for a pledge by more than 40 national retailers to ban plastic bags by next year.

“I see no progress made by the government,” she told journalists recently. “I only see progress made by Lynn and me.”

Energy Cooperation

RoK, Philippines enhance cooperation in renewable energy

25 October 2019

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Philippines

Seoul (VNA) – The Republic of Korea and the Philippines signed a cooperation agreement on renewable energy in Seoul on October 25.

Under the agreement, RoK businesses will participate in building renewable power generation facilities with a total capacity of 100MW at sites under the management of the Philippine defence ministry. The planned power generation facilities will run on various sources including solar, wind, water and geothermal heat.

The project aims to supply eco-friendly electricity to military-related facilities and nearby areas, helping ease power shortages in the Southeast Asian nation.

This is the first time RoK businesses have participated in a renewable energy project with a foreign army.

The agreement follows a memorandum of understanding on renewable energy cooperation signed in June last year when Philippine President Rodrigo Duterte visited Seoul./.

News Clipping

SEE ALSO

World Bank warns Myanmar to double electricity sector investment

NORTHEN THAILAND

Electrical Authority Prepares to Shut Down Mae Moh Coal Mine

Turn the coal mine into a smart city.

The coal mine has not supplied underground coal reserves for more than a decade.

The event has been held for 15 years and is a major tourist draw.

The Mae Moh plant can supply 50% of electricity to the North

LOCAL LINK LACKING

‘JUST THE BEGINNING’

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