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Prezentacija K.Locmelis 30.09.2011

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  • 1. Latvenergo Group presentationKristaps Ločmelis, Project Manager of Regulatory Affairs 30 September 2011
  • 2. Agenda: 1. Latvenergo Group in brief 2. Electric power market of Latvia 3. Baltic market 4. Renewable energy sources 30.09.2011 Latvenergo Group presentation 2
  • 3. Latvenergo Group in brief General Financial Fully owned by the Republic of Latvia (M EUR) 2007 2008 2009 2010 Integrated energy utility engaged in Revenues 514 677 712 818  Generation Net Profit 11 10 28 63  Transmission  Distribution Investments 317 281 149 197  Supply  Telecommunications 4517 employees  Moody’s credit rating Baa3 - stable Technological Customers Installed generation capacities:  Energy sold (2010)  Electric – 7620 GWh  Electric – 2 362 MW  Heat – 3000 GWh  Thermal – 2 275 MW  About 1 million customers connected Length of power lines  Baltic electricity market share ~ 29%  Transmission – 4 747 km  Distribution – 90 928 km 30.09.2011 Latvenergo Group presentation 3
  • 4. Latvenergo Group structure  Latvenergo Group business is organised:  Non regulated business lines  Regulated business lines  According to EU regulations TSO and DSO are unbundled in new legal entities. TSO is reorganized into independent system operator and transmission system owner.  Transmission system owner Latvijas elektriskie tīkli AS (Latvian electrical network) established in 2011. Independent system operator will be sold to the state.  Geographic expansion by participating in regional trade  Social responsibility is addressed by the establishement of Pension Fund 30.09.2011 Latvenergo Group presentation 4
  • 5. Latvenergo Group business lines Generation Trade & Supply Support functions Transmission Fully regulated assets Transmission Distribution 30.09.2011 Latvenergo Group presentation 5
  • 6. Agenda: 1. Latvenergo Group in brief 2. Electric power market of Latvia 3. Baltic market 4. Renewable energy sources 30.09.2011 Latvenergo Group presentation 6
  • 7. Electricity supply structure in 2010 (GWh) 2640 3446 29% 38% 8% 693 25% 2304 Daugava’s HPP (38%) Riga CHPP (25%) Other producers(8%) Import (29%) 30.09.2011 Latvenergo Group presentation 7
  • 8. Latvenergo and its competitors electricity sold in Latvia, GWh8000 7529 7480 71397000 6974 66786000500040003000 Latvenergo2000 Other traders1000 351 340 0 3 94 0 2006 2007 2008 2009 2010 30.09.2011 Latvenergo Group presentation 8
  • 9. Energy risk insurance (ERI) In 2010, Latvenergo AS in cooperation with insurance company BALTA AAS began to offer a new service never before seen on the Baltic market: ERI ERI provides insurance of all technological equipment, machine tools, stock, utilities, goods, raw materials, unfinished and finished products that are owned by a company ERI is covering electricity supply interruptions or lightning damage In 2010, Latvenergo AS gave customers a total of 510 ERI certificates. 24 customers received ERI compensations within half a year. 30.09.2011 Latvenergo Group presentation 9
  • 10. Latvenergo customer service statistics: 2010 monthlyaverage 30.09.2011 Latvenergo Group presentation 10
  • 11. Customer satisfaction In 2010, an average of 500 complaints were received and processed each month. The complaint ratio to total number of customers did not exceed 0.6% in 2010. Just 9% of all complaints were justified, with another 5% partially justified Responses to 52% of complaints were provided within a maximally short time period of 15 days. 30.09.2011 Latvenergo Group presentation 11
  • 12. Agenda: 1. Latvenergo Group in brief 2. Electric power market of Latvia 3. Baltic market 4. Renewable energy sources 30.09.2011 Latvenergo Group presentation 12
  • 13. Baltic electricity supply balance 2010Consumption: 26 TWhGeneration: 23 TWh Import 12% Other stations Narva station In the Baltics 38% 16% Kruonis HAES 3% Vilnius CHPP 2% Riga Elektrenai CHPP Daugava HPP 7% 9% 13% 30.09.2011 Latvenergo Group presentation 13
  • 14. Baltic electricity supply balance 2016Consumption: 30 TWh Generation: 25 TWh Import 18% Narva station 28% Other stations In Baltics 15% Daugava HPP 9% Kruonis HAES Riga 2% CHPP 8% Viļius CHPP 2% Elektrenai new. 400 MW Elektrenai 2% Riga CHPP 2/2 - 11% 5% 30.09.2011 Latvenergo Group presentation 14
  • 15. Price formation estimation in Baltic region  Price is set by the most expensive producer or supplier who cover the consumption  Increasing subsidized RES volumes distorts the market 30.09.2011 Latvenergo Group presentation 15
  • 16. Market functioning scheme 30.09.2011 Latvenergo Group presentation 16
  • 17. Opening of Baltic electricity market in figures Total Total cons. Criteria to became Estimated clients a member of open open market (M) (TWh) market (%) Consumption 0.5 8.5 > 2 GWh/year ~ 30 All from 2013 > 50 employees or 0.9 7.0 turnover > 10 MEur ~ 48 > 100 kW (from Jan 1st, 2011) > 30 kW (from Jan 1st, 2012) 1.4 11.0 ~ 57 All from 2015 30.09.2011 Latvenergo Group presentation 17
  • 18. Total consumption of the electricity of the Baltic States and amount ofelectricity sold by Latvenergo Group, TWh 30 26.6 27.2 25.4 26.2 25 20 15 10 Baltics 7.5 7.5 7.7 6.7 Latvenergo 5 0 2007 2008 2009 2010 30.09.2011 Latvenergo Group presentation 18
  • 19. Electricity sold by the Latvenergo Group in the Baltics in 2010 30.09.2011 Latvenergo Group presentation 19
  • 20. Latvenergo position in Baltic free markets (jan.-aug. 2011) 22% Free market ~30% Free market ~48% 87% 35% Free market ~57% 30.09.2011 Latvenergo Group presentation 20
  • 21. Dynamics of market customers of the Latvenergo Group in 2010 Customers purchasing electricity according to an agreement rather than at a regulated price 30.09.2011 Latvenergo Group presentation 21
  • 22. Baltic market will be integrated in the Scandinavian market 2014 3000 MW 2016 700 MW 2 30.09.2011 Latvenergo Group presentation 22
  • 23. Baltic electricity market design by 2015 Vision for future market design in the common Baltic electricity market:  Nord Pool Spot Baltic with three bidding areas, but one market area  Implicit auction between Baltic countries and towards Nordic Countries on a single trading platform  Harmonized imbalance settlement and imbalance pricing  Common reserves and balancing power market  Baltic retail market  Market place for financial tradeTarget: Baltic market design is consistent with the key elements of the Nordic market design 30.09.2011 Latvenergo Group presentation 23
  • 24. Agenda: 1. Latvenergo Group in brief 2. Electric power market of Latvia 3. Baltic market 4. Renewable energy sources 30.09.2011 Latvenergo Group presentation 24
  • 25. Renewable energy sources in Latvenergo fuel mix, 2010 Use of primary energy sources for electricity generation at Latvenergo AS power plants Gas (41%) RES (59%) 30.09.2011 Latvenergo Group presentation 25
  • 26. Latvenergo AS hydroenergy on the river Daugava30.09.2011 Latvenergo Group presentation 26
  • 27. The Daugava river The Daugava is the largest river in Latvia, sourcing in Russia and flowing through Belarus before it enters Latvia. Within Latvia it has a length of 250 km between the eastern border and the capital city of Riga where the river enters the Gulf of Riga. The hydro-electric potential of the Daugava has been developed by constructing low dams at three sites; Pļavinas, Ķegums and Riga, all of which are owned by Latvenergo, managed by the Daugava hydropower plants staff. 30.09.2011 Latvenergo Group presentation 27
  • 28. Hydropower plants on the river Daugava (1) 30.09.2011 Latvenergo Group presentation 28
  • 29. Hydropower plants on the river Daugava (2)  Pļaviņas HPP number of hydro units 10 Installed capacity 883,5 MW turbine type Francis maximum head 40 m lenght of the dam 4032 m 30.09.2011 Latvenergo Group presentation 29
  • 30. Hydropower plants on the river Daugava (3)  Ķegums HPP Ķegums HPP consists of two hydro- power plants with the total capacity of 264 MW, lenght of the dam - 1978 m 30.09.2011 Latvenergo Group presentation 30
  • 31. Hydropower plants on the river Daugava (4) Ķegums HPP -1 number of units 4 installed capacity 72 MW turbine type Kaplan maximum head 14 m 30.09.2011 Latvenergo Group presentation 31
  • 32. Hydropower plants on the river Daugava (5) Ķegums HPP-2 number of units 3 installed capacity 192 MW turbine type Kaplan (with fixed blades) maximum head 14 m 30.09.2011 Latvenergo Group presentation 32
  • 33. Hydropower plants on the river Daugava (6) number of units 6 installed capacity 402 MW  Riga HPP turbine type Kaplan maximum head 18 m lenght of the dam 15400 m 30.09.2011 Latvenergo Group presentation 33
  • 34. Other Latvenergo RES plantsAinaži wind turbine –  installed capacity – 0.6 MWAiviekste hydropower plant –  installed capacity – 0.8 MW 30.09.2011 Latvenergo Group presentation 34
  • 35. CO2 emissions per unit of electricity produced at Latvenergo AS power plantsThe overall emissions of CO2 by Latvenergo AS per unit of electricity produced in 2010 were 0.104 tCO2/MWhel, whereas the specific CO2 emissions of the combined heat and power plants (Riga TEC-1 and Riga TEC-2) per unit of electricity produced was 0.255 t CO2/MWhel. 30.09.2011 Latvenergo Group presentation 35
  • 36. Regulatory framework to promote RES generation All RES generators (except large HPP) have the rights to sell electricity to public trader under feed-in tariff (FiT) scheme FiTs are much higher than market price. The extra funds needed to finance the scheme are raised from customers as RES promoting component To limit the rising expenses there are quota system for generators – maximum amount of electricity to be sold at FiTs No new quota from 2011. Plans to change promotion system 30.09.2011 Latvenergo Group presentation 36
  • 37. RES feed-in tariffs in Latvia. No reflection to market price. 427.0 450.0 400.0 350.0 300.0EUR/MWh 250.0 204.2 200.0 170.4 162.4 150.0 104.3 100.0 50.0 0.0 small HPP WPP BIOmass BIOgas PV feed-in tariff market price 30.09.2011 Latvenergo Group presentation 37
  • 38. RES market integration not a problem today 2010 2% 96% 5% 1% 1% 0% 0% Daugava HPP small HPP WPP BIOgas BIOmass PV30.09.2011 Latvenergo Group presentation 38
  • 39. RES market integration solution needed in the future 18% 11% 2020 12% 1% 1% 0% 58% Daugava HPP small HPP WPP BIOgas BIOmass PV30.09.2011 Latvenergo Group presentation 39
  • 40. Is there a RES market integration solution? Feed-in premium 90 All producers are in 80 the market and 70 compete with each 60 other 50 EUR/MWh The extra revenues RES producers 40 needed are raised by 30 the fixed “premium” 20 paid by TSO 10 Only cost effective 0 RES PP are built RES revenues Works good in market price feed-in premium Estonia 30.09.2011 Latvenergo Group presentation 40
  • 41. Q&A ?30.09.2011 Latvenergo Group presentation 41
  • 42. Thank you !www.latvenergo.lvinfo@latvenergo.lvLatvenergo ASPulkveza Brieza iela 12, RigaLV-1230, LatviaTel. +371 67728222Fax: +371 67728880 30.09.2011 Latvenergo Group presentation 42

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