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  • Energy Cooperation

The need for renewable energy cooperation

12 December 2018

 – 

  • ASEAN

In October, the United Nations (UN) released a report which highlighted that the world could be on the brink of a climate change disaster if immediate measures are not taken. Leading scientists behind the report have said that the world only has 12 years to keep global warming at a maximum of 1.5 degrees Celsius or it could face a risk of severe drought, flooding and extreme heat for millions of people.

The effects of climate change have already been seen in the region. Alex Chapman, a research fellow in human geography and the head of department of water resources at Can Tho University wrote that Vietnam’s Mekong Delta – home to 18 million inhabitants – is one of the world’s most vulnerable places to climate change. Other experts working in the Mekong have shared the same concerns, pointing out that rising waters, storm accentuation and on-shore salinity are the main factors endangering the populations surrounding the river.

One of the key ways to combat climate change is by using renewable energy instead of being reliant on fossil fuels, natural gas or coal since most renewable energy sources produce very little or zero global warming emissions.

In a joint statement released by the Association of Southeast Asian Nations (ASEAN) and the International Renewable Energy Agency (IRENA) last September, ASEAN has set a target of securing 23 percent of its primary energy from renewable sources by 2025.

This target may seem ambitious but with better cooperation among ASEAN member states, it could become a possibility. The ASEAN Centre for Energy (ACE) has released a study on regional renewable energy cooperation in ASEAN in hopes that it would help strengthen discourse on renewable energy cooperation within the region.

The paper highlighted that cost-reductions on renewable energy would be one of the major benefits of renewable energy cooperation in ASEAN. With more cooperation among member states, it could help remove barriers to obtaining permits, which the study points out is one of the primary causes of delay for renewable energy development. This would then also cut developer costs. Lower costs could attract more investment for renewable energy within the region.

Source: Various

According to the ACE study, regional renewable energy can also enhance energy security as it reduces import dependencies. Energy security refers to the availability of energy at affordable prices. As countries invest more in renewables, they would be less dependent on energy imports to fuel their nation’s energy consumption needs. For example, ASEAN members with similar energy security challenges can coordinate the development of renewable energy in the region. Overall, this would improve the energy mix and grow their energy security.

Regional cooperation is imperative if ASEAN wants to achieve their renewable energy target for 2025. One of the benefits of cooperation among ASEAN states with regards to renewable energy is that it would create space for dialogue and better coordination. The European Union (EU) has a similar framework, dubbed the “CA-RES” programme, which provides a forum for EU nations to exchange knowledge and to put into practice examples of the implementation of renewable energy policies.

ASEAN have already made positive moves towards more cooperation within the region for renewable energy. ASEAN and IRENA signed a Memorandum of Understanding (MoU) in September last year for long-term cooperation between the two bodies and to harness ASEAN’s renewable energy potential.

ASEAN is also implementing the ASEAN Power Grid, which aims to enhance electricity trade across regional borders – complementing the rise in demand for electricity. The ASEAN Power Grid looks to integrate infrastructure that is both, clean and sustainable. One of the projects under the ASEAN Power Grid is the Laos-Thailand-Malaysia-Singapore Power Integration Project. This project involves Malaysia purchasing up to 100 megawatts (MW) of hydro power from Lao PDR through Thailand’s transmission grid. This is beneficial for Malaysia because it would also improve the share of sustainable energy in their total energy mix.

The study by ACE also shows that while there can be huge benefits from regional cooperation, there are also strong obstacles which could impede them. One of the biggest challenges is financial constraints. The study shows that the deployment and transfer of renewable energy technologies requires large funding. It was reported in the media last year that half of Southeast Asia’s renewable energy projects are not financially viable.

This poses a serious problem if ASEAN wants to meet its target by 2025. Especially with IRENA reporting that the region’s energy demand has grown by 60 percent over the past 15 years, and is only expected to keep on growing. Clearly, ASEAN governments need to seriously consider renewable energies when planning their energy mix.

  • Oil & Gas

ERC poised to reconfirm Glow ruling

12 December 2018

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  • Thailand

PTT’s Global Power Synergy wants to obtain Engie Group’s Glow Energy Plc, but regulators have turned down the proposal on anti-trust grounds.

The Energy Regulatory Commission (ERC) is likely to adhere to its recent resolution to derail a takeover effort made by PTT’s unit Global Power Synergy Plc (GPSC) for Glow Energy Plc.

ERC chairman Samerjai Suksumek said board members who participated in the meeting on Dec 7 had reconfirmed blocking the takeover deal, but the decision was not finalised because some members were absent.

The energy regulator’s board met Tuesday afternoon and the resolution will be announced on Thursday, he said.

The ERC on Oct 10 blocked the deal, saying it breached the Energy Industry Act’s standards for a monopoly because the deal would let GPSC control the largest market share of private power purchase agreements (PPPAs) at Map Ta Phut Industrial Estate in Rayong province.

The ERC cited the act’s Section 60, which prohibits monopolies that reduce or limit competition in energy service.

In June, GPSC agreed to purchase 69.11% of Glow’s shares from French-based Engie Group.

The remaining 30.89% of shares were to be bought through a tender offer.

The deal had an estimated value of 139 billion baht.

Under the plan, GPSC was to own 80% of PPPAs in the Map Ta Phut area. Before the takeover began, GPSC controlled 20% and Glow had 60%, with the remaining 20% held by the Provincial Electricity Authority (PEA).

Separately, the ERC will issue new regulations to facilitate the “prosumer” concept, also known as peer-to-peer power trading among consumers, in 2019.

Mr Samerjai said the ERC plans to unlock private and household sectors to participate in the energy sector in line with the country’s energy reform plan.

Solar rooftops are among the crucial projects that the ERC is prepared to launch for 10,000 megawatts over the next 20 years.

This means both sectors will be able to sell surplus electricity from their solar rooftops to the state grids and other properties.

This, is in line with the tentative national power development plan (PDP) in the new revised version, targets allowing private firms or households access to the sector and to peer-to-peer power trade.

Several energy firms have emphasised the need for power trade in communities and residential projects, and in industrial estates such as BCPG Plc and GPSC for pilot projects.

Mr Samerjai said the ERC is open to any firms and state utilities entering discussions before new regulations are issued involving electric vehicles (EVs) and charging stations.

“The adoption of EVs is widespread in the Thai market, and several state agencies and companies are trying to expand their charging stations in Bangkok over the last three years,” he said. “The relevant regulations will be issued next year to facilitate participation for this sector.”

Mr Samerjai said the new version of the power development plan (PDP) is expected to complete public hearings and undergo a final decision by the National Energy Policy Council in early January.

The ERC will then revise the power rate.

“Blockchain is being used in several countries, so Thailand cannot avoid this trend,” Mr Samerjai said.

In addition, the ERC will issue regulations for the liquefied natural gas (LNG) business.

The new LNG business model will shift to transporting LNG by road from ships.

Mr Samerjai said LNG supply is necessary given limited gas pipelines for compressed natural gas.

“The ERC plans to issue licences for this new business,” he said. “LNG is imported by PTT Plc, and the Electricity Generating Authority of Thailand will be the second importer.”

The gas pipeline will be gradually depleted as LNG imports expand in the future.

  • Energy Cooperation , 
  • Energy Economy

Myanmar energy firm plans $35m investment

12 December 2018

 – 

  • Myanmar

DRIVEN by its vision to become an innovative leader in Myanmar’s growing energy sector, locally-owned Parami Energy Group of Companies plans to invest US$35 million (Bt1.15 billion) in its LPG (liquefied petroleum gas) business over the next three years, according to Group CEO Ken Tun, aka Pyae Wa Tun.

He told a media roundtable on Monday the firm has invested 15 billion kyat (Bt318 million) so far, and will spend an additional $25 million to expand its LPG business. He seemed confident the LPG business would be the main driver of the firm’s growth in the long term.

The investment will be used to build a modern energy architecture for the people of Myanmar, bringing safe, reliable and affordable energy to communities across the nation through initiatives such as LPG projects and rural mini-power-grids, Ken Tun said.

“The outlook for LPG business is really bright here in Myanmar. We see much room for improvement because Myanmar’s current LPG usage is 40 times lower than our neighbouring country, Thailand,” he said, citing official figures that showed Myanmar’s LPG consumption is less than 100,000 tonnes per year, compared to Thailand’s 4 million tonnes.

“Our plan is to distribute LPG to nearly two million households by 2020. By doing so, we can also contribute to the livelihoods of women living in rural areas while providing efficient and environment-friendly energy solutions across the nation,” he said.

In the initial phase, the firm will distribute LPG to nearly 150,000 households by the end of this month. As part of its social commitment, the firm will hire only women as their distribution agents.

“We will start with all the townships in Yangon region. Our core strategy is to appoint female distributors only, with an aim to improve their livelihoods. By doing so, we play an active role in women’s empowerment, as the female agents can earn an average income of between 300,000 kyat (Bt6,342) and 500,000 kyat (Bt10,568),” he said.

Ken said the firm has partnered with Thailand’s Sahamitr Pressure Container Plc (SMPC) to distribute LPG in Myanmar.

“We decided to buy SMPC products, though they are more expensive than those of Chinese companies. When it comes to LPG, safety is most important, and we trust in their products because SMPC is one of the leading LPG container manufacturers in the world,” he said.

Parami Energy is one of the only two Licence A holders in Myanmar eligible to import and sell LPG from foreign countries. Currently, the majority of LPG used in Myanmar is imported from Thailand, Malaysia and Indonesia. The firm also looks to import LPG from the Middle East in the years to come. In late 2017, the firm was permitted by the government to manage and operate a state-owned LPG terminal in Thanlyin.

Following extensive remedial work, LPG imports via the marine jetty commenced in February.

“At this point, we are heavily investing in LPG marketing as well as the downstream distribution infrastructure via state-of-the-art systems and equipment,” said Ken Tun.

Last month, the firm opened Myanmar’s first-ever community kitchen to use LPG, locating it in the Pa-O autonomous zone in southern Shan state. The firm plans to set up additional community kitchens in other parts of the country, with the second one scheduled to open in Magway region next year.

“If we could develop an environmentally friendly fuel source that would allow us to curtail the rates for electricity and other fuels, people would have the chance to reduce their electricity costs, and the forest coverage would also widen,” he said.

According to Ken Tun, cutting the forests for fuel to be used in cooking will lead to the deforestation of Myanmar, so the government has to subsidise millions of dollars yearly to pay for electrification.

“For our forests, rivers and natural blessings to be sustainable, we need to find an alternative reliable source of energy. And it is none other than LPG,” he said.

  • Others , 
  • Renewables

ADB invests $155 million in Thai green bonds

12 December 2018

 – 

  • Thailand

The Asian Development Bank (ADB) plans to invest 5 billion Thai baht (US$155 million) in Thailand-based B.Grimm Power Public Company Ltd via five- and seven-year green bonds. Reportedly, the bonds are the first certified climate bonds issued in the country.

According to the bank, the proceeds have been earmarked for nine operational solar PV plants with a cumulative rating of 67.7 MW, and for an additional 30.8 MW, which are currently still under construction.

“This issuance will foster the development of the green bond market in Thailand by showcasing international best practice for genuine green and climate bonds,” said B.Grimm Power president Preeyanart Soontornwata. “ADB’s support was invaluable to ensure the bonds comply with the International Capital Markets Association Green Bond Principles and Climate Bond Initiative standards, building on a long-standing relationship we have forged through multiple transactions.”

Michael Barrow, director general of ADB’s Private Sector Operations Department believes the green bond will help the country to achieve its goal of reducing greenhouse gas emissions by 20% by 2030.

Overall, the bank lauds B.Grimm’s renewable energy efforts and names it a pioneer of low-carbon growth in Thailand.

B.Grimm is said to be one of Thailand’s largest private power producers. Aside from 15 gas-fired power stations, the company also operates 15 solar assets. In July, the company signed a loan agreement with ADB to expand its renewables portfolio from 10% to 30% of its generation by 2021.

At the time, ADB subscribed to 123 million of B.Grimm’s shares worth 1.968 Thai baht ($57.7 million) and announced that it would administer a loan of another $20 million from the Canadian Climate Fund. The investment was destined for 114 MW of solar PV capacity and 16 MW of wind power, as well as additional projects in Cambodia, Indonesia, Laos, Myanmar, Philippines, Thailand and Vietnam.

Last December, IRENA and the Ministry of Energy of Thailand released a report suggesting that Thailand’s share of renewable energy could surpass its target by 2036.

  • Renewables

Up to 3.4-GW wind complex planned for Vietnamese waters – report

12 December 2018

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  • Vietnam

December 12 (Renewables Now) – A giant wind farm with a capacity of 3.4 GW is planned to be constructed off Vietnam’s Binh Thuan province at a total cost of almost USD 12 billion (EUR 10.6bn), the Vietnam News Agency (VNA) reports.

The offshore wind project, dubbed Ke Ga, was proposed by UK-based Enterprize Energy near Vietnam’s southern coast, the news agency said on Tuesday citing the developer’s chairman Ian Hatton. The overall capacity will be installed in 600-MW phases, the first one of which will be switched on after 2022.

MHI Vestas Offshore Wind, a joint venture between Denmark’s Vestas Wind Systems A/S (CPH:VWS) and Japan’s Mitsubishi Heavy Industries (TYO:7011), will initially supply 9.5-MW turbines for the scheme, while more powerful machines are expected to be used in the future, according to the report.

Petroleum Equipment Assembly & Metal Structure (PVC-MS) and Vietnam-Russia oil and gas joint venture Vietsovpetro will be responsible for the design and construction, as well as the installation of the complex’s offshore power transformer stations. They will also be in charge of connecting the underground cables.

(USD 1.0 = EUR 0.883)

  • Renewables

Challenges facing solar power development in Vietnam

12 December 2018

 – 

  • Vietnam

In April 2017, Prime Minister Nguyen Xuan Phuc issued a decision on mechanisms for encouraging solar power development. This decision has given a boost to this sector as it set up an attractive price for solar electricity – 2,086 VND or 9.35 US cent per kWh – for 20 years, compared to the current average power price of 1,500-1,700 VND per kWh. It also includes other incentives in terms of tax and land.

As a result, while the number of registered solar power projects was still modest by early 2017, 121 projects with a combined capacity of over 9,200MW had been added to the electricity development plan as of September 2018. Meanwhile, another 211 projects with a total of 16,800MW haven’t even been named in the list yet.

Dr. Nguyen Huy Hoach from the Vietnam Clean Energy Association said the national electricity development plan for 2011-2020 requests that power projects using renewable energy resources, including solar energy, be accelerated so that their capacity will reach 850MW by 2020 and 4,000MW by 2025.

To that end, solar power generation facilities with a capacity of over 200MW, 600MW, and 1,600MW will need to be installed each year by 2020, between 2020 and 2015, and in the five following years, respectively, he added.

Diep Bao Canh, Chairman of the Red Sun Energy JSC, said Vietnam now has a chance to strongly develop solar power as more and more businesses enter the industry. Additionally, equipment prices have declined considerably as solar panel prices have dropped from 3-4 USD per Watt peak to less than 0.5 USD per Watt peak. The country’s natural conditions, including the average solar irradiance of 4.5-5.5 kWh per sq.m each day, are also favourable for solar power development.

However, it is not a completely smooth path for solar power development in the country.

According to the Vietnam Energy Association, certain technical solutions are needed to convert electric current to connect solar or wind electricity plants with the national grid. As the grid’s connection points with wind and solar power factories increase, risks of operational problems also arise.

Dinh Quang Tri, Deputy General Director of the Vietnam Electricity (EVN) group, said the connection will raise transmission and distribution expenses, elaborating that most of these plants have been planned in the central region, especially Ninh Thuan and Binh Thuan provinces. Meanwhile, the local transmission system is quite weak as the electricity demand here is lower than other regions.

The EVN has asked for more transmission lines to be constructed, but the work is related to procedures and site clearance, so it will not be able to be completed soon to transmit all electricity from solar power plants.

Tri added that if the EVN does not purchase solar power, an electricity shortage is likely to happen. However, if the group, designated to buy all electricity from solar power projects, fails to load, disagreements between project investors and the EVN could occur.

Le Van Luc, Deputy Director of the Electricity and Renewable Energy Authority at the Ministry of Industry and Trade, said that with favourable policies, Vietnam is attracting investment in solar and wind power.

However, there haven’t been detailed analyses of where such projects should be located in or how to connect them with the national grid. Even in potential areas like Binh Thuan and Ninh Thuan, more studies on the projects’ connection and operation are needed to ensure safe, constant and stable supply.

Luc also pointed out problems in dealing with waste from solar power plants, such as panels, since there hasn’t been a detailed guidance issued on how to treat it. –VNA

  • Bioenergy

PM: B10 biodiesel to drive green efforts and economy

12 December 2018

 – 

  • Malaysia

PUTRAJAYA: Malaysia’s initiatives to use palm-based biodiesel as fuel will reduce stock and stabilise commodity prices amid attempts by others to restrict its export and sales, said the Prime Minister.

Tun Dr Mahathir Mohamad, who drove home the point when he arrived for the launch of the B10 biodiesel at the wheel of a Peugeot 508, said such efforts would also be beneficial to the environment, lessening pollution and greenhouse gas emissions.

The Peugeot 508 uses the B10 biodiesel.

Dr Mahathir said he wanted the biodiesel programme to be given due attention in the National Automotive Policy currently being drafted by the International Trade and Industry Ministry.

Among the things to be considered was to only allow diesel vehicles that use more than 10% biodiesel to be sold in Malaysia.

“The biodiesel initiative is important because oil palm is our golden crop and helps generate the economy. Through this effort, 650,000 smallholders will continue to enjoy stable commodity prices and higher income,” he said at the launch of the B10 biodiesel programme for the transportation sector.

The use of B10 biodiesel – a blend of 10% palm methyl ester and 90% petroleum diesel – by the transportation sector will be made mandatory on Feb 1 next year.

The ruling affects diesel-using vehicles such as lorries, buses, pick-up trucks and even private cars.

However, vehicles using Euro 5 diesel will be exempted.

The government will also be making it mandatory for the industrial sector to use B7 biodiesel from July 1 next year.

These measures are expected to encourage domestic palm oil uptake of around 761,000 metric tonnes and contribute towards greenhouse gas emission savings of 2.2 million tonnes of carbon dioxide yearly.

“I believe the B10 programme for the transportation sector will help spur high demand for palm oil locally.

“And the B7 programme to be implemented later will complete the country’s biodiesel programme.

“Malaysians should be proud of our own biodiesel product that is being used as renewable energy and our contribution towards efforts in tackling global climate change,” said Dr Mahathir.

He said efforts by palm oil producing countries, including Malaysia, to come up with renewable energy or palm-based biodiesel faced negative response from the international community, such as the European Union and non-governmental groups.

“The attacks are part of their strategy to block palm oil from competing in the international market.

“It is because the commodity is relatively cheaper than other oil and is beneficial to health. As a result of continuous attacks, palm oil has been given a bad reputation,” he said.

 

  • Bioenergy

Biofuel firm Neste to invest 1.4b euros in Singapore production

12 December 2018

 – 

  • Singapore

[HELSINKI] Finnish biofuel producer and oil refiner Neste said on Wednesday it will boost its biofuel production capacity in Singapore with a bigger-than-expected investment of 1.4 billion euros (S$2.2 billion).

Neste, 44.75 per cent owned by the state of Finland, has in recent years emerged as one of the leading players in the renewable diesel market thanks to its global sales and wide range of feedstock including waste and residues like animal fats.

The investment will boost Neste’s renewable production capacity to 4.5 million tonnes annually by 2022 from a current 2.7 million tonnes. Neste had previously talked about increasing the capacity by one million tonnes.

“The decision is based on a growing global market demand for low-carbon solutions in transport and cities, aviation, polymers and chemicals,” Neste said in a statement.

“The investment will strengthen our competitive advantages which are based on the global optimisation of our production and waste and residue raw material usage.”

Neste makes biofuels in Singapore, Rotterdam and Porvoo, Finland, and it also does conventional oil refining in Finland. The new production line is due to start in 2022. Shares in the company were up 0.9 per cent by 0806 GMT.

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ASEAN Centre for Energy (ACE) is an intergovernmental organisation within ASEAN structure that represents the 10 ASEAN Member States’ (AMS) interests in the energy sector.

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