world bank’s energy program in asiapubdocs.worldbank.org/pubdocs/publicdoc/2016/3/... · world...
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World Bank’s Energy Program in Asia
Dr. Dejan R. OstojicLead Specialist
Energy & Extractives Global PracticeMarch 25, 2016
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Mission statement Strategy, structure and services Investment profile Examples of country programs Key contacts
AGENDA
The World Bank Group aims to end extreme poverty & promote shared prosperity in a sustainable manner...
…including by supporting client countries to secure affordable, reliable, and sustainable energy supply
By 2030: Ensure universal access to affordable, reliable and modern energy services Increase substantially the share of renewable energy in the global energy
mix (18% to 36%) Double the global rate of improvement in energy efficiency (1.3% to 2.6%)
The 2013 Energy Sector Directions Paper guides WBG finance
From projects to sector policy and planning: large-scale investments and cross-border collaboration Priority to increase access where applicable
(e.g. Myanmar) Commitment to reduce pollution through
efficiency, renewables and hydropower Engage more in natural gas: bridging fuel and
enabler for variable renewables No coal except in rare circumstances
The framework also guides projects with greenhouse gas impacts
World Bank (2013) Toward a sustainable energy future for all: directions for the World Bank Group's energy sector.
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ex) Indonesia Energy Sector Development Policy Loan
ex) Myanmar Economic Value of Natural Gas
ex) Myanmar National Electrification Project
EEX Global Practice: Current Portfolio (FY10-15)
10.08
5.855.34
3.35
6.83
4.43
0
2
4
6
8
10
12
FY10 FY11 FY12 FY13 FY14 FY15
FY10-FY15 Commitment (USD Billion) in Energy Sector
General Energy Policy, InstitutionalDevelopment & Capacity Building
Upstream Extractives
Thermal Power Generation
Transmission and Distribution
Energy Efficiency
Renewable Energy (Non-Hydro) generation
Renewable Energy (Hydro) generation
World Bank finance to energy & extractives in South & East Asia($11.9 billion active, $2.4 billion to be approved by June 2016)
Includes IBRD and IDA only. Excludes Global Environment Facility, Trust Funds and Analytic & Advisory Services.
Active: $4,886m
Pipeline $1,225m
East Asia & Pacfic
Active: $7,024m
Pipeline: $1,221m
South Asia
n=16 n=7
n=2 n=3
n=3
n=13 n=2
n=6
$m
$500m
$1,000m
$1,500m
$2,000m
China Indonesia Lao PDR Mongolia Myanmar PacificIslands
Philippines Vietnam
Other Sectors (Non-Energy)Policy & Institutional DevelopmentExtractivesThermal PowerRenewable Energy (Non-Hydro)HydropowerEnergy EfficiencyTransmission & Distribution
World Bank finance to energy & extractives in East Asia & Pacific(43 active projects plus 9 projects to be approved by June 2016)
Lending Projects Only, Excludes Analytical & Advisory Services.
n = number of projects
World Bank finance to energy & extractives in South Asia(26 active project plus 4 projects to be approved by June 2016)
Lending Projects Only, Excludes Analytical & Advisory Services.
n=5
n=4
n=8
n=6n=1
n=4
n=2
$m
$1,000m
$2,000m
$3,000m
$4,000m
Afghanistan Bangladesh India Nepal Maldives Pakistan Regional
Other Sectors (Non-Energy)Policy & Institutional DevelopmentExtractivesThermal PowerRenewable Energy (Non-Hydro)HydropowerEnergy EfficiencyTransmission & Distribution
n = number of projects
Challenges Solutions
• 35,000 new generation capacity in 5 years to catch up with rising supply
• 2 million new connections a year to achieve 100% access by 2020
• 23% of renewable energy in fuel mix
• Reduction of PSO as subsidies target the poor only
Need to mobilize $12.5 billion of investment a year
to address the above challenges
Financing • Support PLN to mobilize massive soft and long-term
financing through direct lending to SOEs; • Automatic and gradual tariff adjustment for cost
recovery • JV with foreign partnersDelivery• Simplifying IPP/PPP procedures and incentive packages• Strengthen Central Integrated Planning & Tendering for
new capacity (geothermal, hydro, IPP)• Clarify responsibility/accountability between central
gov., local gov. and PLNRegulations• Issue implementing regulations for geothermal• Issue new domestic gas pricing • Performance-based regulation for PLN• Move licensing issuance responsibility for hydro from
local to central government • Improving gas sector governance an regulation
World Bank Energy support in Indonesia
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Financing Energy Infrastructure
Renewable Energy & Low Carbon Development Access to Modern Energy
Investment lending• Indonesia Power Transmission
Development ProjectIBRD: US$ 225 million
• Second Power Transmission Development Project IBRD: US$ 325 million.
• Upper Cisokan Pumped Storage Hydro Electricity Project IBRD: US$ 640 million
AAA & Non lending• TF Smart Grid• Direct Lending to SOEs
Investment lending•Geothermal Power DevelopmentIBRD+ CTF
AAA & Non lending•Benefit Sharing for Hydropower Investments Financing Options for PPP hydro generation (ESMAP)•Biodiversity Management for Hydro (DFAT)•Geothermal Investment (ASTAE)•NZ Grant Geothermal Capacity Building to PGE•Carbon Capture & Storage•Financing Options with PPP for Hydro Power Project (ESMAP)
AAA & Non lending• Renewable Energy Resource
Mapping & Geospatial Planning (ESMAP)
• Indonesia Least Cost Electrification Planning & Access Improvement (DFAT, ASTAE, ESMAP)
• Support to RBF for Clean Stove Initiative
• Clean Stove Phase II
Governance & Sustainability Energy Subsidy Reform; Performance Based Regulation TA; Direct Lending to SOEs
- 14 -Total ongoing Investment: $1.52 billion and TA $12 million
World Bank Energy Portfolio in Indonesia
FY16 FY17 FY18
Investment lending • Geothermal Energy
UpstreamCTF : $ 50million; GEF $10
million• Result- based Sector Loan
for Distribution: $500 million
DPL• Energy DPL $500 million
Investment lending• Poko Hydro Power
Project; $ 360 million• Second Geothermal Clean
Energy Investment Project; $300 million
• Additional Financing for UCPS; $100 million
DPL• Energy DPL $500 million
Investment lending• Matenggeng Pumped
Storage Hydro Electricity ProjectIBRD: $ 500 million.
• Result- based Sector Loan for Distribution: $500 million
- 15 -Total Pipeline Investment FY16-18: $3.82 billion
World Bank Energy Pipeline in Indonesia
World Bank Energy Investment Projects in Vietnam: Ongoing and Planned
5 Ongoing Investment Projects Closing $mln Client
Renewable Energy Development Project (REDP) 06/30/2016 202 MOIT
Clean Production & EE GEF (CPEE) 06/30/2016 2.4 MOIT
Trung Son Hydropower (TS) 12/31/2017 330 EVN
Distribution Efficiency Project (DEP) 12/31/2018 450 5 PCs
Transmission Efficiency Project (TEP) 12/31/2019 500 NPT
6 Planned Investment Projects FY16-19 $mln Delivery Client
Energy Efficiency for Industrial Enterprises (VEEIEs) Project 200 FY16 MOIT
Renewable Energy Development Project (REDP) AF 100 FY16 MOIT
Power Sector Reform Development Policy Operations (PSRDPO 4, 5, 6) 200 FY17 MOIT
Distribution Efficiency Project (DEP) AF 500 FY17 5 PCs
Genco Divestiture (WBG) 400 FY18 EVN
Generation Efficiency Project – Don Duong Pumped Storage 800 FY19 EVN
World Bank energy focus in mainland south-east Asia
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Lao PDR (IDA)• Hydropower: HMTA and NT2• Access: REP2 and PGP• Regional integration
Myanmar (IDA)• Shortages of gas and electricity: MEPP• Access: National Electrification• Hydropower
Cambodia, Thailand and Malaysia:• Regional integration
On-Going Medium Term (2016-2017) Longer Term (3-5 years)
• Increase capacity and efficiency of Thaton gas-fired power station (Electric Power Project, $140M IDA Credit, including a $10M TA component)
• TA for financial viability and institutional development of power and gas sectors, including tariff and subsidy review, E&S capacity building, etc.
• National Electrification Project – NEP1 ($400M IDA Credit, including a $20M TA component) cover the first 6 years of electrification program, jointly with Lighting Myanmar (IFC) initiative.
• Hydropower Generation Project (e.g. 1050 MW Shweli-3 and 670 MW Middle Yeywa) jointly with IFC and MIGA
• Policy dialog, ASA and technical assistance on power market reform and sector development to Ministry of Electric Power and Ministry of Energy
• LNG Business Plan TA to Ministry of Energy and valuation of natural gas in domestic market
• TA on power system development and integration of grid-connected solar PV
• The second gas-fired power generation project (e.g. the 500 MW Ayeyarwady CCGT)
• Renewable Generation Project (e.g. grid-connected solar PV)
• Transmission System improvement and new Power Dispatch System (SCADA/EMS)
• NEP 2 (additional financing)
• Myingyan 250 MW IPP Transaction Advisory Services;
• Financial support for the Myingyan IPP, including MIGA guarantee
• Support MOEP to improve efficiency in power distribution and corporatize YESB(C) and MESC
• Support sustainable development of renewable / hydropower (e.g. Shweli-3 and Middle Yeywahydropower)
• Introduce private sector capital and operational capability to power distribution (YESC and Mandalay).
• Financing support for Ayeyarwady and ThaketaPPP/IPP.
• Policy Dialog on Sector Reform and Development.
• Construction of privately invested hydropower.
• Development of grid-connectedsolar PV
• Full corporatization of urban distribution sector.
• Construction and commissioning of privately invested energy projects (e.g. LNG terminal)
• Support MOEP to improve efficiency
• Develop action plan for scaling up private sector participation
• Expand reach of distribution network
• Political Risk Guarantee(s).
• Improve Distribution and Expand PowerGeneration System
• Improve Distribution and Expand Power Generation System
IDA
IFC
MIGA
KEY OUTCOME: raise access to electricity from 30% to 50% by 2020; connecting 6.2 mil people
MYANMAR ENERGY: WBG Joint Implementation Plan
WBG in Myanmar is working jointly with development partners
Sector Planning Legal and Regulatory
Financial Sustainability
Transmission & Distribution Generation Rural Energy
Analytical Basis for Strategic
Decisions
EITI ApplicationSupport
Financial Viability Action Plan
Dist Improve’t in Yangon and other
cities
New CCGT for MEPE & IPPs;
PPP Transactions
Off-grid power program
Energy Master Plan for NEMC
(ADB/Japan (JFPR))
Electricity Law & Electricity Regulation
(ADB/Norway)
StrengtheningFinancial
Management (Multi-donor)
4-regiondistribution
system improvement
Donated GT and generators (GOT,
Japan/JICA)
National Electrification
Project
National Electricity Master Plan(Power Sector Master Plan)
National Power Transmission
Network (ADB-JICA-Korea)
Urgent Rehab and Upgrade
(Yangon, Thilawa, Baluchaung)
Rural Power Infrastructure
(electrification in 14 regions/states)
National Electrification
Plan
RuralElectrification
Law
Economic Valuation of
Natural Gas in domestic mkt.
Advisor for YESB and Capacity Dev of T&D Engineers
PPP bidding and contracting
support
Studies on Off-grid Small Scale Hydro
Energy EfficiencyPolicy and Renewable
Energy Devel. Plan
Environmentaland Social
Safeguard and Conservation
YESB Corporatization Support through Investment and
Advisory Support
Institutionaldevelopment for
sector management of
PPPs
= ADB = Japan/JICA = World Bank Group = Others/Multiple 19
World Bank energy support in the Pacific• Planning, enabling policy, institutional and
regulatory frameworks, and capacity building: – Tonga and Vanuatu National Energy Roadmaps– Vanuatu establishment of Utilities Regulator and
capacity building and support to Department of Energy
– FSM States Energy Master Plans– Development of National Electrification Rollout Plan
in PNG, TPAC/GC, Renewable Energy resource mapping
• Utility reform: – Solomon Islands – Solomon
Islands Electricity Authority – Kiribati Reform – Public Utilities
Board – FSM Utilities Reform
Access to affordable, reliable and sustainable electricity services: Vanuatu Increase Electricity Access Project Vanuatu Rural Electrification Project Fiji Sustainable Energy Financing Project
Facilitating least cost power infrastructure,including through smart PPPs Tina River hydro and loss reduction in Solomon
Islands Naoro Brown hydro in PNG Kiribati grid connected solar PV Tuvalu Renewable Energy/Energy Efficiency Gensets in FSM
For South Asia, transformative action on low-carbon energy could require $8-13 billion additional finance by 2020
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This would require IDA/ IBRD capital increase and/or additional capital resources in the form of international climate finance.
• $1 billion of World Bank financing has helped India expand five regional transmission systems to enable transfer of power from energy-surplus regions to towns and villages in under-served regions, improve reliability and reduce losses.
• $155m World Bank financing, and $7.6m from USAID, to a public-private partnership in Bangladesh has benefited over 2 million people through installation of solar home systems in remote villages (over 70,000 solar home systems added each month: fastest rate in the world), as well as over 1,450 biogas plants and 40 solar irrigation pumps
Select highlights of World Bank energy support in South Asia
Illustration of WBG synergies for leveraging: Working with Nepal to transform the energy system
WB Policy Investment
Energy/Water DPC to facilitate sustainable public and private investments
WB Public Investments
• Hydro: Kali Gandaki Rehab• Solar: Grid Connected
Solar• Transmission: East-west
backbone line and Nepal-India cross-border line
IFC Support to Private Investments
Hydro:• Kabeli A (37MW)• Upper Trishuli (216 MW)• Upper Marshyandi (600 MW)• Upper Karnali (900 MW)• Andhi Khola• Small hydro credit lineTransmission:• Private Nepal-India Intercon• PPPs • ESG and Project Advisory
IFC local currency bond
MIGAGuarantees
Hydro:Upper Trishuli
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East Asia & Pacific China, Mongolia: Todd Johnson [email protected] Indonesia: Gailius Draugelis [email protected] Philippines: Alan Townsend [email protected] Vietnam: Franz Gerner [email protected] Myanmar, Laos, Thailand, Cambodia: Dejan Ostojic [email protected] Papua New Guiea & Pacific Islands: Gerard Fae [email protected] Asia India: Simon Stolp [email protected] Pakistan, Afghanistan: Richard Spencer [email protected] Nepal, Bangladesh, Bhutan: Jie Tang [email protected] Sri Lanka, Maldives: Sandeep Kohli [email protected]
World Bank energy focal points for key countries in Asia