The document provides an overview of the energy sector and environment of Maldives. Some key points: - Maldives has no domestic energy resources and relies entirely on imported fossil fuels like diesel and gasoline. Diesel accounts for around 85% of energy supply. - Electricity is generated across the country's 200 inhabited islands, with only 24 islands having reliable power from STELCO, the national utility company. Renewable energy like solar plays a small role. - The government is concerned about environmental issues from fossil fuel use and is promoting renewable energy and energy efficiency to reduce emissions and reliance on imports. - STELCO generates and distributes power to over 40,000 customers across 27 islands

1. Maldives
Energy and environment

3. About
Maldives

4. The Republic of Maldives is a small island nation located
in the Indian Ocean southwest of Sri Lanka. It consists
of some 26 major atolls and 1,190 tiny islands lying at
the equator . Of these islands, only 33 have an area
greater than one square kilometer. The total land area is
less than 300 square kilometer. Maldives is a country
with more territorial sea than land. The population is
about 300,000 and is highly concentrated on relatively
few islands. The atolls are ringed by coral reefs that are
the seventh largest in the world and among the richest in
terms of species diversity and aesthetic appeal. The
reefs host over 1,900 species of fish, 187 coral species,
and 350 crustaceans.

5. There are some 200 inhabited islands scattered across
the archipelago, and some 90 additional islands given
over to resorts. The populations of inhabited islands
vary from a few hundred inhabitants to several
thousand.
Distances between atolls and inhabited islands are
great and transport costs are high, depending on sea
and air transport. Male is the location of the country’s
major port and international airport (located on an
adjacent island: the Hulhule Island).

6. The Maldives is largely a service-oriented economy. Due to its small
population and limited endowments of land, the scope for agriculture
and manufacturing is limited. Nature-based tourism is the primary
industry, accounting for about 70 percent of GDP (in terms of direct and
indirect contributions), followed by fishing and fish processing (about 10
percent of GDP). Revenues from these activities have been channeled
largely into public investments in education, health and infrastructure,
creating an economy that is graduating to middle-income status.
Economic performance has been robust over the past two decades with
growth averaging about 7 percent per year reverting to its historical
growth path after the post-tsunami contraction in 2005 and the rebound
in 2006.

7. Outlines the contribution to growth.

8. Nature-based tourism has recently served as the engine
of growth and prosperity for the economy. The country
has a tourism capacity of about 16,000 beds with an 82
percent occupancy rate. The sector is poised for rapid
expansion, with plans for 10 new domestic airports to be
managed by the private sector, improvements to existing
transport facilities and leases to 51 additional resorts by
2009, which would amount to a 50 percent increase in
bed capacity

9. Energy Sector
Scenario

10. Maldives has no conventional energy resources (e.g., oil and gas) that it can
utilize to meet its energy needs. Basically, the country utilizes imported
petroleum fuels to meet all of its energy needs. Bulk of these fuel imports is
diesel fuel oil (DFO), which is mainly used for power generation both by the
state power utility (STELCO) and close to 1,000 other electricity generators in
the outer islands. DFO is also used in seawater desalination (for potable
water production) and in steam generation. Petroleum products are also
used in land transport (e.g., gasoline, high-speed diesel), including aviation
(jet fuel), industries, and households (e.g., kerosene, LPG). Firewood (e.g.,
dried branches) is also a main cooking fuel in most of the outer islands. Most
urban households use LPG and kerosene for cooking. In the outer islands,
the main source of energy for domestic purposes has been biomass.
Nowadays, more outer island households are now using kerosene and LPG
for cooking instead of biomass materials (shrubs and coconut husks).

11. Energy Carrier Typical Uses Energy Supply, Mtoe
Kerosene Lighting and cooking 5,070
LPG Cooking, Industrial metal works 630
Diesel
Land and water (domestic and international)
transport, industrial operations, and electricity
generation
117,998
Gasoline Land and water transport 8,979
Aviation Fuel Air transport (domestic & international)
5,353

12. The total commercial energy supply in 2000
was 138,030 million tons of oil equivalents
(Mtoe). Diesel fuel oil accounts for bulk of
the energy supply in the country (about
85.5%). Gasoline accounts for 6.5%; aviation
fuel, 3.9%; kerosene, 3.7%; and LPG, 0.5%.

13. Maldives Energy Supply Mix (MToe)

14. Since Maldives is a small nation consisting of 1,190
tiny islands lying at the equator. The number of
islands inhabited remains at 200, while another 87
islands are specially developed as tourist resorts.
Hence, each island has to have its own electric power
generation system and other basic infrastructure.
However, regular and continuous electric power
supply is available in only 24 of the 200 inhabited
islands. These 24 islands have power generation
provided by the Government-owned company, The
State Electric Company Ltd (STELCO).

15. Generators operated by Island Development Committees (IDCs),
with the financial assistance of the Ministry of Atolls
Administration (MAA), serve an additional 50 islands and private
providers serve 6 islands with 24 hours of electricity a day. The
remaining islands have at least 5 to 12 hours electricity service.
The Asian Development Bank (ADB) presently supports an Outer
Islands Electrification (OIE) project, which focuses on
electrification with 24-hours service community generators
(facilitated by an US$ 8 million loan to the Government of
Maldives), on 40 islands. Electricity is typically generated using
DFO or Fuel No. 2. STELCO, a wholly state owned company, is
regarded as the national power utility. The Maldives Electricity
Bureau (MEB), chaired by the Ministry of Trade and Industries
(MTI), regulates STELCO and the private power providers.

16. Data on electricity generation and consumption in the
Maldives are limited to that of STELCO power plants,
which collectively account for about a little more than a
third (34.9%) of the total installed power generation
capacity of the country. The total installed power
generation capacity in the country is 106.2 MW, bulk of
which, are in the resort islands (48.3%). Those in the
outer islands operated by the IDCs and some private
generators account for 13.2% of the total power
generation capacity. The rest are those installed in
airports (3.5%).

17. Maldives imports all its fuels in refined form and in very small
quantities, which makes this form of fuel even more
expensive. The yearly consumption of fuel is growing rapidly,
thus the proportion of hard earned foreign exchange spent
on fossil fuels is increasing. Renewable energy is used to
power navigational lights (marking the reefs), communication
transceivers on fishing boats and for power supply at the
remote installations on the national telecommunication
network. These installations are not connected to the grid
and are privately owned and operated. Solar energy is also
used on a small scale for producing hot water for homes and
in the tourism industry.

18. The telecommunication company of
Maldives is the single biggest user of
renewable electrical energy, which is
produced using solar energy. There are
177 sites, mainly using solar power or
solar-diesel hybrid systems, in operation.
The largest site has a capacity of 3.5 kW
while the total capacity approximates 130
kW.

19. The Government of Maldives is very much aware and
concerned about environmental degradation and global
warming. These are real threats to small island nations,
especially for low-lying islands like those of the Maldives.
The Government is very actively taking steps to reduce the
emission of greenhouse gases and other environmental
pollutants in the Maldives, while concurrent efforts are made
to make Maldives greener. Towards this end, the Ministry of
Communication, Science and Technology is mandated to
explore the feasibility of using renewable energy capable of
providing reliable electricity supply to the islands.

20. The State Electric
Company Ltd
(STELCO)

21. The State Electric Company Ltd (STELCO) is, entirely, a state-
owned organization responsible for the generation,
distribution and supply of electricity to customers
throughout the Maldives. Around the nation, it operates in
27 islands, employing approximately 650 employees.
Operating from a Head Office in Male', the Company
provides electricity and other related services to its
customers for the safe and efficient use of electrical energy
and to support the economic development of the Republic.
STELCO has a proud history of over 50 years of delivering
exceptional service to the general public.

22. Founded in 1949 as the Electricity Department
and later known as the Maldives Electricity
Board, STELCO has expanded the public
electricity supply from modest beginnings to
today when it serves a total of around 40,000
customers on Male' and the Outer Islands.
However, the company's balance sheet and
profits have been adversely affected by rising
fuel costs, since 2003.

23. I. Organizational: Overview
In its organizational structure, STELCO has given
special emphasis to customer service through
the establishment of a Customer Service
Department and also a separate unit
responsible for Outer Island regional operations.
Its sixteen main business departments are:

24. Power Generation
Electrical
Customer Services
Regional
Projects and Planning
Information Technology
Procurement
Finance and Accounts

25. Administration and Human Resources
Auditing and Internal Control
Villingili
Thilafushi
Hulhumalé
Bill Services
Sales Centre
Transport and Maintenance
Management

26. STELCO presently employs a total staff of 650 although this has
been declining in recent years as the Company improves the
efficiency of its operations, replaces older plant and equipment
with more modern facilities, thus reducing maintenance, and
automates routine processes. Recently, STELCO established a
permanent IT Department to further modernize its systems. It
also established a Human Resources Department in recognition
of the importance of training and retaining competent staff
capable of maintaining supply to customers to high standards in
the future. The loyalty and commitment of STELCO’s staff is an
important ingredient in the Company’s success.

27. II. Generation
STELCO has a modern and efficient diesel power generating
plant in Male. In 1949, STELCO started providing electricity with
just one generator set with a capacity of 14 kW. Since then the
generation capacity has been increased according to the
demands of consumers, through various expansion projects. In
the outer islands, the company provides electricity using small
diesel generating sets and low and medium voltage distribution
networks. The total generating capacity both in Male’ and outer
islands is approximately 59,134.8kW.

28. Male Powerhouse
The Male powerhouse is the largest generation facility in Maldives.
It generates and provides reliable and efficient electric energy to
meet the growing demand of Male. The 4.5 MW facility
commissioned in 1991 has transformed itself, in the past sixteen
years, into a state-of-the-art generation facility with a total capacity
of 35,490 KW which now require over 115,000 liters of diesel daily
for operation. A 56 member staff team, with engineers,
supervisors, and technicians keep the power facility in operating
condition at all times. The current generating capacity in Male’ is
35,490kW and at present peak demand in Male’ is 29,328 kW.

29. III. Network Facilities
STELCO has operates high voltage and low voltage
underground networks on the island to supply its
customers. It also operates a desalination plant for
supplying purified water for use in the power station.
In the Outer Islands, the Company operates small
diesel-electric generating plants and networks of
various types for public supply.

30. IV. STELCO Sale Centre
The STELCO Sales Centre deals in the supply of electrical items
to the local market. Namely the items used to install electricity.
It is run as a subsidiary to STELCO, the only energy provider to
Male and major islands. It sells electrical products from well
known brands. This Centre first opened in 2000 under Sales
and Marketing Department as STELCO Showroom and in 2006
it has been restructured to run as a separate trading centre
with the name “STELCO Sales Centre”. It is located inside the
Head Office Building of STELCO.

31. Renewable Energy Resources
Solar and Wind Energy
Biomass Resource

32. Solar and Wind Energy
On solar energy, the only available data from the country’s Department of
Meteorology (DMet) are the number of hours of sunshine per day. There are no
data available on solar energy radiation.
DMet also measures wind speeds at various airports in the country. These wind
measurements are at 10 meters above the ground, and because of the low altitude,
these are not representative of wind speeds at the higher levels at which turbines
are usually positioned. These measurements were taken at 3-hour intervals, and
they show average wind speeds varying between 7.2 knots – 11.3 knots. Recent
measurements made by the US based National Renewable Energy Laboratories
(NREL) have indicated that the largest wind potential in the country is in the islands
located between 4.5o and 6o N latitudes.

33. Biomass Resource
The main source of energy for domestic purposes in most
of the outer islands has been biomass. Fuel wood is used
for cooking and smoking of fish. Biomass includes dry
branches from trees and shrubs, coconut husks, dry
coconut leaves, coconut shells. However, with the depletion
of wood resources and subsequent restrictions on tree
cutting, households have switched to kerosene and LPG for
cooking instead of biomass materials.

34. Another source of biomass material is municipal solid waste. According to
the Municipality Waste Management Section in Male’, the typical
composition of municipal solid waste is: paper and cardboard (33%); kitchen
waste (15%), and construction waste (industrial/scraps) (52%). About 15% of
the construction waste is wood. Daily solid waste generation in Male’s is on
the average 140 tons. Biodegradable waste (mainly food waste) is about 25
tons/day. The solid waste is sorted prior to transporting to the island of
Thilafushi. Only the biodegradable and combustible materials (i.e., organic)
are dumped in the pits. The combustible materials are burned first before the
ashes (plus unburned matter) are dumped into the pit. The landfill area is
already 10 years old. Previously it was just a reef and now it has now a
reclaimed area of 100,000 m2. Some industries now exist in the area such as
a cement packing plant and a LPG refilling plant. Landfill gas from the area
can be recovered and utilized for power and heat generation for use by the
industries located in the area.

35. Energy
Policies

36. POLICY 01
STRENGTHEN THE
INSTITUTIONAL AND
REGULATORY FRAMEWORK
OF THE ENERGY SECTOR

37. PROMOTE ENERGY
CONSERVATION AND
EFFICIENCY
POLICY 02

38. POLICY 03
INCREASE THE SHARE
OF RENEWABLE
ENERGY IN THE
NATIONAL ENERGY MIX

39. POLICY 04
IMPROVING RELIABILITY
AND SUSTAINABILITY OF
ELECTRICITY SERVICE AND
MAINTAIN UNIVERSAL
ACCESS TO ELECTRICITY

40. POLICY 05
INCREASE NATIONAL
ENERGY SECURITY