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Ewura presentation at the Renewable energy day

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Ewura presentation at the Renewable energy day

  1. 1. Overview of Small Power Producers (SPPs) in Tanzania Renewable Energy Workshop TAREA 6th June, 2012 Eng. Anastas P. Mbawala Director of ElectricityEnergy and Water Utilities Regulatory Authority (EWURA), Tanzania 1
  2. 2. Outline  Small Power Producer (SPP) – examples  Overview of Tanzania SPP regulations  Tanzania Legislative Framework  Goals,  Standardized Framework / Table of SPP documents  Tariff Issues  Main grid, mini grid, wholesale and retail sales  Calculation process and Levels  Required permissions and approvals, procedures for application; process rules  Current situation: successes and challenges  PPAs, generators in the pipeline  Challenges 2
  3. 3. Tanzania SPP Legislative Framework  National Energy Policy, 2003  Policy Statement No. 36  Energy and Water Utilities Regulatory Authority Act  Establishing EWURA,  Emphasis on Rural services, §6(d)  Rural Energy Act (2005)  Establishing REA & REF  The Electricity Act, 2008  Defines SPPA & SPPT 4
  4. 4. SPP Framework Documents Main grid Mini-gridStandardized Standardized Power Purchase Standardized Power PurchasePPA Agreement for Purchase of Grid- Agreement for Purchase of Off-Grid Connected Capacity and Associated Capacity and Associated Electric Electric Energy Between Buyer and a Energy Between Buyer and a Small Small Power Project Power ProjectTariff Standardized Tariff Methodology for Standardized Tariff Methodology formethodology the sale of Electricity to the Main Grid the Sale of Electricity to the Mini-grids in Tanzania Under the Standardized Under the Standardized Small Power Small Power Purchase Agreements. Purchase AgreementsProcess Guidelines for Developers of Small Power Projects (SPP) in Tanzania;Guidelines • Includes standardized forms(roadmap)Process rules Rules for Developers of Small Power Projects (SPP) in TanzaniaInterconnection Guidelines for Grid Interconnection of Small Power Projects in TanzaniaGuidelines (Parts A, B, C)Interconnection ◊ Rules for Grid Interconnection of Small Power Projects (Not Yet provided)rulesAnnual Tariff Detailed Tariff Calculations under the Detailed Tariff Calculations under thecalculations SPPA for the Main Grid for each year SPPA for the Mini-grids for each year
  5. 5. Salient Features Small Power Purchase Agreement (SPPA)  A Must Take Plant  Term – 15 years  Seller may opt to join electricity trading / sell retail  Isolated SPPA switches to Main grid SPPA upon interconnection with main grid Standardized Tariff Methodology  Avoided Costs of the Utility  Technology Neutral  Floor and Cap Prices  Calculated Annually / Reflect Seasonality (Main Grid)  Local Currency Denomination 6  Adjustment for Transmission Losses
  6. 6. Annual Feed-in-Tariff Levels 2008 2009 2010 2011 2011GRID 100 96.11 110 121 152.54 TZS/kWh Mid Yr Rate (TZS/$) 1176.99 1321.69 1393.82 1598.39 US$/kWh 0.085 0.073 0.079 0.076ISOLA N/A 334.8 369 380 480.50TED TZS/kWh Mid Yr Rate (TZS/$) 1176.99 1321.69 1393.82 1598.39 US$/kWh N/A 0.253 0.265 0.238 7
  7. 7. Necessary permits, clearances and procedures for application Land title or leaseResource Rights (e.g. water rights from River Basin Water Office) Letter of Intent (LOI) Sequence is important to Business license, tax registration, etc. avoid competing claims on Building Permit project sites Environmental and Social Clearance (NEMC) Power Purchase Agreement (PPA) EWURA licence 8
  8. 8. SPPs In Operation Project MW Type of Status ResourceACRA Tanzania 0.3 Hydro In Operation / Community based — Main gridTANWAT 2.34 Biomass -wood Selling 1 MW (2010)-Main GridTPC Co-Generation 15 Baggasse Contracted to Sell 9 MWe to TANESCO — Main gridKatani Power Plant 0.3 Biomass - In Operation – Pilot, not Waste connected to network—Isolated mini-gridChipole St. Agnes 0.4 Hydro Mini-Hydro for own use but canConvent be expanded to supply surrounding villages
  9. 9. SPPs in Preparation Project MW Resource StatusSao Hill Energy 15 Biomass Provisional Licence (Grid)Chipole – Own use & sell 3-5 Hydro additional 3MW on new siteto the grid planned (off-grid)Mwenga 3.36 Hydro PPA Signed with TANESCO (off- grid)Ngombeni Mafia 1.4 Biomass PPA Signed with TANESCO. Under construction (off-grid)Kilombero Sugar Co. 10.6 Bagasse Applied Licence (Grid)Tanzania Sisal Board 0.5+ Biogas Applied Licence intends to roll out in several sisal plantationsKitonga Mini Hydro 10 Hydro Applied Licence, may increase capacity (Grid)Andoya Hydro Electric Co. 0.5 Hydro Provisional Licence (Off-grid)Kilocha Hydro 12 Hydro In discussion with REA (Grid)Kilombero Mngeta 3 Hydro In discussion with REA (Grid)
  10. 10. ChallengesChallenge Response n Lack of Renewable Energy 1. Government needs to set Policy clear policy with targets, etc. n Inadequate financial 2. WB has established a loan resources to support the guarantee facility, engage initiative interest of other financial institutions n Inadequate private sector 3. Conducive Environment, rules participation in investment and publicize n High interest rates loans 5. Promote other sources mix from commercial banks grant and loans n Land ownership and water n Include land ownership & rights for SPPs projects water rights in RE Policy especially wind farms & mini-hydro plants
  11. 11. Challenges …..cont. 2Challenge Response1. Low, non-cost reflective tariffs n Government has directed & depreciating Currency, EWURA develop technology specific FiTs. But who will pay the premium?4. Lack of experience of key n Capacity building (REA) project promoters with skills in project management5. Lack of interest on the part of n Improving through regular potential Off-takers discussions with utility (TANESCO) n Introduce technology specific7. Isolated Grid SPPA changing FiT to some types or maintain into Main Grid SPPA upon the higher off-grid FiT interconnection
  12. 12. Conclusion Renewable Energy Sources are important in Tanzania Lack of Renewable Energy Policy stalls the development of RE Projects Non Reflective Tariff /FiT is one of the Key barriers to initiating RE Projects Small Power Projects can feel the Gap between projects, and a better solution for rural electrification 13
  13. 13. 2nd Generation SPP Rules Edition 2012 14
  14. 14. Thank YouFor more information Visit website www.ewura.go.tz

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