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Private power augments dwindling hydropower as drought worsens

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Private power augments dwindling hydropower as drought worsens Empty Private power augments dwindling hydropower as drought worsens

Post by Backstage on Mon Jan 23, 2017 10:16 am



Private power augments dwindling hydropower as drought worsens
By Sandun Jayawardana

As Sri Lanka enters a period of prolonged drought, the strain on the country’s electricity grid continues to mount. Authorities, alarmed at the rapidly worsening situation, announced a variety of measures throughout the past week, aimed at conserving electricity and connecting more power to the national grid.

With the capacity of hydropower reservoirs at 32.8%, and water levels at all of its reservoirs below 50%, the Ministry of Mahaweli Development and Environment this week stressed that providing water for drinking and for farmers to protect their crops, would take precedence over releasing water for electricity generation.

Sri Lanka’s current peak hour electricity demand is about 2300 Megawatts (MW). If the drought conditions worsen, the Ceylon Electricity Board (CEB) expects a shortfall of 600-700 MW. As such, the CEB has already gone ahead with plans to purchase emergency power for the national grid. Accordingly, tender for the purchase of 60 Megawatts (MW) of emergency power was awarded this week at a cost of Rs 28 per unit. Secretary to the Ministry of Power and Renewable Energy, Dr Suren Batagoda told the Sunday Times that the Government was happy with the outcome, as the cost was lower than that of a unit of electricity generated by existing private power plants such as Kelanitissa.

Additionally, the CEB will restart purchasing power from three private power plants whose agreements had been allowed to expire. One of them, the 25MW ACE power plant in Matara, will start generating electricity for the national grid early next week, following the renewal of its agreement for a year. The 100 MW Heladanavi plant in Puttalam, meanwhile, will be connected to the national grid from April, while the agreement with the 100 MW ACE Power plant in Embilipitiya, which was due to expire this April, has been extended by another year.

The Government is also expecting about 300 MW from a self-generation scheme by bulk supply customers such as factories. “About 100 MW have already come,” Dr. Batagoda observed.

The Secretary further revealed that the Government is considering purchasing a 200 MW barge mounted power plant within the next two months, as an additional cushion against power shortages. “We are considering it, as the price of such power plants, currently in the world market, is low,” Dr. Batagoda elaborated.

While measures to purchase emergency power and renew agreements with power plants are taking place, several steps aimed at energy conservation are also being put in place, while appeals have been made to the private sector and the public for their cooperation.

President Maithripala Sirisena underscored the urgency of the matter on Friday (20), when he requested private business establishments to switch off their lights used for promotion and decorative purposes, to save energy, until the drought situation eases. The President pointed out that a significant amount of power could be saved, if this was done.

The Government has also requested urban councils to switch on their street lamps one hour later than the current time of 5.30 pm, to save electricity. This followed closely on the heels of another decision to issue a circular limiting the minimum temperature of air-conditioning (AC) units in Government offices to 26 Degrees Celsius. Dr. Batagoda told the Sunday Times that this was done as AC units account for some 60% of power consumed at Government and private offices. “If we can reduce the usage of the ACs and keep them to such a temperature, we can save up to 50 MW. That’s why we are requesting offices to do this at least for the next three months.”

Phasing out energy-sapping incandescent bulbs is another step under active consideration. Dr. Batagoda revealed that, according to CEB estimates, these bulbs waste 95% of electricity supplied. Though the majority of the population have shifted to LED and CFL bulbs, it is estimated that about 20% of the population in the country were still using incandescent bulbs. “We will be appealing to households still using those bulbs to switch off as many of those lights as they can,” the Ministry Secretary stated. The CEB is hoping to bring down 1 million LED bulbs and distribute them among those using incandescent bulbs, free of charge if necessary. The aim is to exchange the LED bulbs for incandescent ones, removing them completely from the power sector.

The situation, however, continues to be extremely delicate, given the electricity grid’s over-reliance on thermal power, particularly the breakdown-prone Lakvijaya Coal Power Plant in Norochcholai. Unit 1 of the plant, which had been out of action since last October, was reconnected to the national grid last Sunday (15). While the unit has a capacity of 300 MW, CEB officials stated that it was currently being operated at 50%, while engineers make further technical adjustments. The unit is expected to be fully operational by early next week.

Thermal power (coal and oil) currently generates 85% of the country’s electricity needs. The Government insists there is no chance of island-wide powercuts. CEB engineers though, say such a scenario is inevitable if Lakvijaya was to suddenly lose two of its three units, resulting in the national grid losing 600 MW. Power outages can also be expected if the 300 MW Kerawalapitiya plant and one unit at Lakvijaya plant are knocked out. “At present, we simply don’t have the water to generate hydropower to meet such a shortfall,” CEB Engineers’ Union President Athula Wanniarachchi, disclosed.

According to Mr Wanniarachchi, purchasing emergency power, coupled with additional fuel costs, would cost the State as much as Rs 50 billion for just six months. He claimed these funds could have been saved if the Government had properly implemented the CEB’s Long Term Generation Expansion Plan (LTGEP).

“The Rs 50 billion cost won’t be paid by the Government. The cost would ultimately be passed onto the consumer through higher electricity tariffs, indirect taxes or by slashing funds to some other sector such as Health or Education,” he opined.
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Private power augments dwindling hydropower as drought worsens Empty Re: Private power augments dwindling hydropower as drought worsens

Post by කිත්සිරි ද සිල්වා on Mon Jan 23, 2017 10:37 am

Encouraging renewable sources to be sought by soft loans and higher % of buy back rates will make many think of this option as viable too.

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Private power augments dwindling hydropower as drought worsens Empty Re: Private power augments dwindling hydropower as drought worsens

Post by Backstage on Mon Jan 23, 2017 10:40 am

For our narrow short term self interests, who are the listed entities benefiting fro the one year agreements ?
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Private power augments dwindling hydropower as drought worsens Empty Re: Private power augments dwindling hydropower as drought worsens

Post by Dileepa on Mon Jan 23, 2017 12:43 pm

Backstage wrote:For our narrow short term self interests, who are the listed entities benefiting fro the one year agreements ?

To start with, LLUB would be a one share to watch.
This sector is almost dominated by Caltex.
Counter may hit Rs.170/= soon & I think will peak around Rs.200/= by Aug. 2017 study

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Private power augments dwindling hydropower as drought worsens Empty Re: Private power augments dwindling hydropower as drought worsens

Post by Backstage on Mon Jan 23, 2017 12:49 pm

Dileepa wrote:
Backstage wrote:For our narrow short term self interests, who are the listed entities benefiting fro the one year agreements ?

To start with, LLUB would be a one share to watch.
This sector is almost dominated by Caltex.
Counter may hit Rs.170/= soon & I think will peak around Rs.200/= by Aug. 2017 study

That's interesting. Would there be a correlation to the increase in Thermal power generation ?
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