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Singapore trails only behind Netherlands in readiness for driverless cars: KPMG

13 February 2019

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Singapore

The Lion City’s test town for driverless vehicles is complete with traffic lights and a rain machine to recreate stormy tropical weather.

Singapore retained its second spot amongst 25 countries that have been actively rolling out initiatives in support of autonomous vehicles (AV), according to KPMG’s 2019 Autonomous Vehicles Readiness Index (AVRI).

The index, which assessed countries on 25 different variables such as policy and registration, found that Singapore government is positioning the country as a global centre for AV development with the deployment of a simulated urban test-bed and plans for driverless buses amidst a stellar showing in the policy and legislation, and consumer acceptance categories, although it fell short of Netherlands in terms of infrastructure.

Also read: Driverless shuttle kicks off trial in Sentosa

“The government is very proactive in thinking about the future of mobility,” Satya Ramamurthy, KPMG’s partner and head of infrastructure, government and healthcare, said in the report. “It is seriously investigating the possibilities as well as preparing for a regulatory environment that will facilitate a future that is autonomous.”

Singapore created a test town for driverless vehicles in Nanyang Technological University in November 2017 complete with traffic lights, bus stops, skyscrapers and a rain machine to create its extremely wet tropical weather.

The government is drawing on this facility in setting new road traffic rules, which are slated for publishing in early 2019, KPMG added in its report. Singapore shared top ratings in an assessment of its AV regulations with Australia, Finland and the Netherlands, and for having a single government entity for AV work with Hungary.

Additionally, the report noted that the areas of Punggol, Tengah and the Jurong Innovation District will use driverless buses and shuttles for off-peak and on-demand commuting from 2022, whilst working with the index’s first placer Netherlands on an international standard for AVs.

Also read: Authorities unveil national standards for driverless cars

That being said, Singapore ranked relatively low on technology and innovation, placing 15th out of the 25 countries. However, Ramamurthy said that Singapore’s lack of conventional automotive manufacturing may prove to be a strength in developing electric vehicles (EVs) and AVs as they use a substantially different set of components.

Home appliances manufacturer Dyson recently announced it would open a new factory in Singapore to build electric cars in 2021, as well as move its corporate office to the Lion City.

Also read: Singapore’s electric vehicle ambitions receive boost as Dyson enters fray

Although the relatively low number of electric charging points is a weakness, Ramamurthy pointed out that electricity providers amongst others are planning to install more of these.

Energy utilities firm SP Group launched its first wave of 38 EV charging points islandwide on 9 January as part of its goal to build Singapore’s largest public EV charging network with 1,000 points by 2020. Similarly, BlueSG announced it would launch its charging network to third party vehicles progressively in Q1 2019 in its bid to push for the development of EVs.

Meanwhile, the report pointed out how Singapore taxes private cars heavily, which may provide a way to promote AVs, albeit at a cost.

“Effectively the pricing is done to discourage people from driving,” Ramamurthy explained. “That brings with it a whole set of opportunities. There is a lot of policy room for the government to do things to promote adoption, should it wish.”

Rounding off the top five countries prepared to adopt AVs were Norway, US and Sweden.

Renewables

Govt. to implement Nantpanga hydropower project in Homalin

13 February 2019

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Myanmar

Sagaing Region government is planning to implement Nantpanga hydropower project worth over Ks 20 billion in Homalin Township.

The project is expected to generate four megawatts of electricity and six billion Kyats has been prepared for the project for this financial year. The ministry will call for tender soon, said Soe Oo, the regional minister for finance on February 11.

“We are distressed that locals have to pay Ks500 per unit for electricity here. It is a hindrance for the development of the area. We conducted a survey, which cost Ks340 million, for the project last year. There are companies which applied for the project. The project is expected to cost over Ks 20 billion roughly. We cannot fulfill other requirements as one project cost billions of Kyats,” said the minister.

The locals from Homalin are depending on the electricity supplied from the private sector and some are still using solar energy and candlelight.

“Pho Thi Cho Company is distributing electricity in Homalin but the electricity bill is expensive as they rely on running diesel generators to supply electricity. There are people who cannot afford the electricity bill. We have to give about Ks 20,000 for using lighting for personal use. We are glad that we heard about the project and we want it to implement as soon as possible,” said a local.

Townships in upper Chindwin River in Sagaing Region are depending on private sector for electricity as they have no access to national grid yet.

Renewables

Vietnam mulls multi-layered FIT scheme as it kicks energy transition into gear

13 February 2019

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Vietnam

The shape of Vietnam’s solar policy after its FIT regime expires in June will be one of the most hotly anticipated PV developments in Southeast Asia.

According to a draft decision released by the Ministry of Industry and Trade, the 20-year FIT of $0.0935/kWh introduced in April 2017, and valid for projects that achieve commercial operation before June 30, could be replaced with a two-year solar tariff, which would take into consideration various irradiation levels.

With the exception of the rooftop solar FIT in the cloudy north – which would be set at $0.0985/kWh in the first year and $0.0886/kWh thereafter – the proposed new tariffs are lower than the current ones.

“Overall, from July 2019 to June 2020, the southern region will get 25% less FIT, the central region 15% less and the FIT for the northern region remains approximately the same,” said Rystad Energy analyst Minh Khoi Le. “The FIT will reduce by 5% across all regions for the same period in 2020-2021.”

With the FIT varying regionally – in a country where the sunny south hosts more than 85% of utility-scale solar – tariffs will also differ based on the solar technology used, whether floating PV; ground-mounted; projects collocated with storage; or rooftop solar.

And the proposed FIT level will further depend on whether projects reach commercial operation before or after June 30 next year – with lower tariffs applying to later projects. An exception will be made in the case of Ninh Thuan province, where the current FIT system has been extended by 12 months after the June deadline, despite calculations its 2 GW quota has almost been filled.

Potential impacts

While lower tariffs may displease project developers, the proposed scheme could see more balanced solar deployment and mitigate grid bottlenecks in the south.

“In general, the new solar FIT draft will not only spread out the solar deployment across the country but also refine the market participants to only the committed serious players,” Minh told pv magazine. “When we compare the irradiance, the highest region in the south has 25% more solar irradiance yearly than the highest region in the north, which is the same as [the] reduction percentage in [the] FIT. Hence, the attraction for this region should still remain.”

While the rush to finish large-scale projects in the south will intensify before June, Rystad Energy expects all approved projects in the north to go ahead, including three planned projects with capacities of more than 130 MWac each.

“However, factoring in the land cost in certain areas and the experience from the first phase of solar farms construction, we can expect some projects to go ahead in the southern region, especially from serious developers,” added Minh.

Regardless, the draft FITs are far below the $0.15/kWh proposed in a report published by the Asian Development Bank (ADB) which aimed to improve bankability of projects against the backdrop of a lightly regulated electricity price and uncertainty about the creditworthiness of Vietnam’s state-owned utility EVN.

Banner year

Looking to shift away from fossil fuels and reduce its greenhouse gas emissions by 25% in 2030, and by 45% in 2050, Vietnam is planning to increase the share of renewables to 7% of its energy mix next year and 10% in 2030, up from around 4% last year. Solar is expected to increase from a capacity of 368 MW at the end of 2017 to 850 MW – 0.5% of overall electricity generation – next year, 4 GW in 2025 (1.6%) and 12 GW (3.3%) in 2030, as noted in the ADB report.

Market research company IHS Markit has tipped Vietnam to be one of the most promising PV markets this year. Predicting a record 123 GW of solar will be installed worldwide – up 80% on last year – analysts foresee a shift away from China with two-thirds of new capacity located elsewhere, including in Argentina, Egypt, South Africa, Spain and Vietnam, which between them are set to account for 7% of the 2019 market – 7 GW of new capacity.

According to Rystad Energy, 40 projects totaling 2 GW of capacity are due to come online in Vietnam this year, a big leap from only two large-scale solar projects – the 49 MW Krong Pa and 35 MW Duc Hue solar farms – commissioned last year.

Noting government incentives introduced in 2017 attracted 20 GW of large-scale solar developments to the regional pipeline, Rystad has predicted Vietnam will lead the way as Southeast Asia’s installed PV capacity triples this year.

“The main concern in Vietnam is the risk of grid overload once these plants are completed,” added Rystad’s Minh. “EVN, the country’s only utility company, will need to find more free space in the grid or these plants will not be producing to their designed capacity.”

Renewables

Rooftop solar to ensure renewable energy future

13 February 2019

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Vietnam

For five months, Mac Nhu Lai, a 57-year-old resident in Ho Chi Minh City has been using a three kilowatt-peak (kWp) rooftop solar photovoltaic system called BigKilowatt. The system saved 30 per cent on his electricity bill and increased his income by selling electricity back to the national power grid. “Reducing the electricity bill, the solar rooftop panels help reduce our environmental footprint,” Lai said.

Solar rooftop systems became popular in Vietnam. By installing solar panels and a green roof, owners can save costs and enjoy the socio-environmental benefits of a living roof.

Racing to rooftop

The Vietnamese commercial and industrial sectors has shown a lot of interest in solar rooftop panels.

The 2015-2018 period has seen a number of investments and investment announcements for new or expanded PV module and cell manufacturing capacities. These investments are partly made by local Vietnamese investors such as the expansion of the existing Red Sun module manufacturing or the Solar BK/IREX module and cell manufacturing plants, but feature mostly foreign (mainly Chinese) investors such as Canadian Solar Inc., CSUN, Boviet, Vietnam Sunergy JSC or Vina Solar.

The power market is witnessing a boom in solar power projects as local and foreign investors are racing to reap the benefits of the 9.35 US cent feed-in-tariff (FiT).

The latest data shows that a total of 332 solar projects have been registered with the total capacity of 26,290 megawatt peak (MWp), including 121 projects (7,234MWp total capacity) that will begin to generate electricity by 2020 and 211 (13,069MWp) awaiting approval. These figures have far exceeded the targets of the revised Power Development Plan VII. Additionally, more than 800 small-scale rooftop solar power projects with a combined capacity of nearly 11.6MW have been developed.

The installed capacity connected to the grid is dominated by a rather small number of medium-sized rooftop systems, such as the installations of Intel Corporation in Ho Chi Minh City (220kWp), Big C Green Market in the southern province of Binh Duong (212kWp), PUMA/Avery Dennison in the Mekong Delta province of Long An (100kWp), Deutsche Bekleidungswerke (DBW) in Long An (165kWp) or the National Conference Hall (154kWp), the UN building (119kWp), and the new National Assembly building (50kWp) or the building of the Ministry of Industry and Trade (MoIT – 22kWp) in Hanoi.

At its exhibition booth on the side-lines of the recently-held Vietnam Economic Forum 2019, Mai Van Trung, business development director of SolarBK, told VIR that last year, SolarBK deployed more than 300 projects with a total capacity exceeding 3MWp. In terms of production, SolarBK’s member IREX also contributes to the domestic and foreign markets with a total of more than 50MWp of panels and photovoltaic cells.

From July 2018, SolarBK launched the BigK 2-10kWp solution for households, which exceeded their wildest expectations by occupying 46 per cent of the market for household solution packages in five months.

Pham Trong Quy Chau, director of TTC Energy JSC, also said that the roofs of companies, factories, and apartments have great potential to install solar roof systems. Currently, this company has been renting rooftop space and installing solar panels to then resell the generated energy at a lower price than the utility company.

According to renewable expert Phan Hieu Hien, if only two million roofs in Vietnam were installed with 10kW solar roof panels, coal usage would be reduced by 16 million tonnes per year (worth $3-4 billion) at coal-fired power plants.

Rooftop solar panels have never been more affordable for home and business owners and communities, and they can now help households halve their monthly electricity bills, while contributing to environmental protection. The payback period of five or six years, especially in the south of Vietnam, makes for a promising prospect for international companies, according to Rainer Brohm, a renewable energy expert.

Commercial and industrial solar PV rooftop applications have great development potential and promise interesting investment opportunities for the private sector in Vietnam. Besides households, deploying solar energy at production sites would help manufacturing industries improve the reliability of their power supply and reduce the demand for non-renewable power. This would also bring significant savings for the commercial and industrial sectors in terms of electricity consumption due to high tariffs during peak hours and the cross subsidisation policy charging large consumers more to subsidise smaller ones.

Green trends and 4.0 tech

Nguy Thi Khanh, director of GreenID, the co-ordinator of the Vietnam Sustainable Energy Alliance, said that a greenhouse programme is underway to encourage the installation of solar system on houses’ roofs.

She stated that solar power technology is reliable and cheaper than fossil fuel, and is better for both the environment and human health.

The rising popularity of distributed energy sources like rooftop solar has given end-consumers an opportunity to produce electricity too. No longer just consumers, they are also electricity producers, hence becoming “prosumers.” This is a recent but popular phenomenon.

The high power demand is urging the sector to adapt to an expected explosion in independent power generation – including from households with rooftop solar panels. A winning combination of smart grid, distributed renewable energy sources, and blockchain could trigger an energy revolution the likes of which have never been seen before. It can be the beginning of an era where energy independence is a reality.

Blockchain enables so-called “peer-to-peer” transactions. With this type of transaction, every participant in a network can transact directly with every other network participant, without involving a third-party intermediary. The innovation behind blockchain is that transactions are no longer stored in a central database, but distributed to all participating computers, which store the data locally. The first relevant blockchain application was the Bitcoin cryptocurrency. Over recent years, Bitcoin has become the basis for other blockchain applications, most of which are currently being developed in finance. A number of businesses and initiatives have recently been launched to apply the blockchain principle to other industries, including the energy sector. Blockchain applications are very promising, but they are still at an early stage of development.

Trung from SolarBK told VIR that end-users who directly trade electricity with each other get a better rate than from the utility, while the buyer also gets the energy at a discounted rate.

“Peer-to-peer energy trading is becoming a reality with the help of blockchain technology. Most energy transactions are complex and cumbersome due to the involvement of many parties and regulations. Blockchain can straightaway remove the complexities and let end users deal with each other, while still providing them a secure environment to do so,” said Trung, adding that SolarBK is preparing to apply 4.0 technologies after collecting a database for four years.

Vietnam has expansive solar resources that could be used to successfully develop the solar energy sector. Current scientific estimates of the overall solar resources in Vietnam state an average of 4-5kWh per square metre per day in the southern, central, and partially even northern Vietnam – totalling 1,460-1,825 kilowatt hour (kWh) per sq.m per year – and average peak irradiation of up to 5.5kWhper sq.m per day in some southern areas (totalling up to 2,000kWh per sq.m per year). These solar irradiation levels are comparable to most countries in the region, including developed solar markets such as China, Thailand or the Philippines, as well as to international solar markets, such as Spain and Italy.

Electricity/Power Grid

SMC Global Power readies P30-billion bond issue, gets top rating

13 February 2019

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Philippines

MANILA, Philippines — SMC Global Power Holdings Corp. is returning to the bond market with a fresh offering of as much as P30 billion debt notes to partly repay loans and fund investments.

The loan obligations were incurred mainly to finance three acquisitions, including the acquisition of 100 percent interest of AES Phil Investment Pte. Ltd. in AES Transpower Private Ltd. and in AES Philippines Inc.

The bond issue, which represents the first tranche of the company’s three-year shelf registration of bonds worth up to P60 billion, was assigned the top credit rating of PRS Aaa by local credit watchdog Philippine Rating Services Corp.

Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The issuer’s capacity to meet its financial obligations is extremely strong.

The bond issue was also issued a strong outlook, which means that the rating is “likely to be maintained or to remain unchanged in the next 12 months.”

In arriving at the rating, PhilRatings considered SMC Global Power’s leading market position, with a solid platform for expansion; strong support from parent firm San Miguel Corp., its stable profit and substantial cash flows, and its ideal position to capitalize on the growing demand for electricity in the Philippines.

SMC Global Power is one of the country’s leading and largest power companies, with a combined capacity of 4,197 megawatts as of the end of September 2018.

Its combined capacity of natural gas, coal and hydropower resources represents about 19 percent of the power supply of the national grid and 25 percent of the Luzon grid.

Through its wholly owned subsidiaries, SMC Global Power serves as the independent power producer administrator (IPPA) for the Sual, Ilijan and San Roque power plants.

The company’s power portfolio also includes the 218 MW Angat hydroelectric power plant in Bulacan, the 450 MW greenfield power plant in Limay, Bataan, the 300 MW greenfield power plant in Malita, Davao Occidental and the 684 MW Masinloc power generating facility in Masinloc, Zambales.

Electricity/Power Grid

GBP cited for compliance to power spot market rules

13 February 2019

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Philippines

MANILA, Philippines — A subsidiary of Global Business Power Corp. (GBP) has been cited for compliance to wholesale electricity spot market (WESM) rules.

In a statement, GBP said subsidiary Panay Energy Development Corp. (PEDC) has been named by the Philippine Electricity Market Corp. (PEMC) as among the 10 generating companies with the least number of violations of market rules.

PEDC has a combined gross capacity of 314 megawatts (MW).

Each scheduled generator is required to comply with the must-offer rule (MOR) and real-time dispatch (RTD) deviation.

Any violation of the rules, meanwhile, will result in the imposition of penalties.

“Through continuous compliance with WESM regulations, GBP helps encourage competition in the market as well as promote effective operation of transmission networks,” GBP president Jaime Azurin said.

GBP head commercial and strategy Philip Dasalla cited the need for market participants to continuously adhere to WESM rules and regulations.

“Following WESM rules ensure that efficiency gains are maximized, as price signals pressure businesses to reduce costs, align process, and use their assets more effectively,” he said.

Since 2018, PEMC has served as a governance body under the regulatory oversight of the Department of Energy and the Energy Regulatory Commission, tasked with monitoring compliance by market participants.

The WESM operation was turned over to the Independent Electricity Market Operator of the Philippines Inc. in line with the thrust of the Electric Power Industry Reform Act (EPIRA) for the market to be run by an independent market operator.

GBP operates 11 power generation facilities in Cebu, Iloilo, Aklan, and Mindoro.

In 2017, the company acquired a 50 percent stake in Mindanao-based Alsons Thermal Energy Corp.

Electricity/Power Grid

Coal and transmissions set to drive power infrastructure sector

12 February 2019

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Fitch Solutions Macro Research, a subsidiary specializing in market research services of Fitch Group, said in its newly-released outlook for Vietnam’s power sector that the country’s electricity generation is set to increase to 236 terawatt hours (TWh) by 2023 and to 318TWh by 2028.

The research unit said that the Government, along with international observers, has been pushing for a decrease in reliance on coal and an increase in renewables usage to lower greenhouse gas emissions, reduce air pollution, and achieve sustainable growth in light of challenges posed by climate change.

However, according to the Fitch Solutions Key Projects Database (KPD), coal projects current dominate the power infrastructure construction pipeline – out of 57 projects currently in the pre-construction phase, 17 are coal-fired plants, accounting for more than 85 per cent of the total project value.

Together with facilities currently under construction, coal-fired plants are expected to provide an additional 66GW of capacity if all pipeline projects turn operational, a figure that is well ahead of other sources of energy.

This indicates a short-term reliance on coal to meet the rapid increase in demand for electricity within the country, which will result in the construction of coal-fired plants as the primary driver of the local power sector.

Fitch Solutions believes the construction of non-hydro renewable power plants, currently the second largest component of the pipeline, with 24 projects in the pre-construction phase with a total value of US$4.7 billion, will gain traction in the next few years.

This view is underpinned by increasing efforts to promote usage of renewable energy, such as wind and solar, along with technological advancements in renewable and grid technology that would further drive down the cost of implementation.

In particular, Fitch Solutions expects an increase in the launch of wind and solar power projects given the Government’s renewable push via the recent adjustment of feed-in tariffs. The KPD reveals 15 projects currently under construction and a further 24 projects, mostly wind and solar, in the pre-construction phase, underscoring the growing opportunity in the renewable construction sector.

The research unit also expects additional investment in grid infrastructure in tandem with rising demand for electricity in the country. Demand for electricity is mainly driven by rapid urbanization and economic growth in the country’s two most populous localities – Hanoi and Ho Chi Minh City.

The current network transmitting electricity from the north and central regions to the south is overloaded and under strain, causing instances of power outages and larger power losses.

To address the issue, the National Power Transmission Corporation (EVNNPT) has announced plans to launch three 500kV and 30 220kV power transmission projects in 2019, to increase capacity for power transmission. Hence, upgrades to existing grid infrastructure would help to minimize power distribution losses, Fitch Solutions asserted.

Power losses have been on a steady decline since 2011 and the EVNNPT intends to make further improvements to transmission efficiency, especially on the 220kV lines, which carries the majority of the electricity produced.

These projects will continue to be led by State-owned utility Vietnam Electricity (EVN), with opportunities in financing, construction and provision of equipment by local and foreign companies, the research unit noted.

Renewables

Cambodia’s 100 MW National Solar Park project moves forward

12 February 2019

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Cambodia

The Asian Development Bank (ADB) is moving forward with implementation of the 100 MW National Solar Park project in Cambodia, launched in June 2017.

The lender has issued an expression of interest to seek project implementation consultants for design and construction of the large-scale solar park, which is expected to be developed in several phases.

The ADB said the project is intended to improve the power supply of national utility Electricité du Cambodge (EDC) and bring technical benefits to the grid. The project is also intended to expand low-cost power generation, diversify the generation mix with more clean energy, and extend the use of competitive tenders and other global best practices in Cambodia’s energy sector.

The solar park will be built on up to 200 hectares of land and will be connected to the EDC network near the Phnom Penh demand center – in the Kampong Speu and Kampong Chhnang provinces – through a transmission system to the GS6 grid substation.

Cleaning the grid

The first phase of the project will be tendered by the utility on an unspecified date and financed through private sector equity and commercial debt. The project is also intended to strengthen EDC’s ability to add renewable energy to its generation mix, including through technologies such as energy storage.

The ADB said the park will build on a 10 MW solar project implemented by Singapore’s Sunseap in Bavet, a special economic zone of Cambodia in the Svay Rieng province, near the border with Vietnam.

In October, the United Nations Development Program launched an initiative for the development of a “full economical appraisal of the potentials of solar PV energy in Cambodia”. The nation’s power demand is currently met mainly from hydropower and coal, which account for 40% and 36% of the electricity supply, respectively, with another 19% met from imported power.

Cambodia issued new rules for the integration of solar in January 2018. The guidelines established a framework for the installation of rooftop and large-scale systems but failed to provide financial incentives. Kohe Hasan, partner at Reed Smith and director of Resource Law LLC (Singapore), and Kaknika Lin, assistant consultant at KPMG Cambodia Ltd, in March provided a summary of the key regulations and discussed the country’s investment climate.

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