Energy Efficiency and Renewable Energy Opportunities for Scaling Up Innovation in Energy
June 19, 2009
Outline of Presentation
Technical Focus of RE and EE Projects in China Recent Experience from Other Countries – Mexico, Turkey, Egypt – Heating and Building EE in East Europe(Serbia, Lithuania)
Useful Experience for China Annex: Energy Efficiency in Irrigation in China
Technical Focus in RE and EE
Renewable Energy
Energy Efficiency
• On-grid wind power • On-grid small hydro; • Off-grid decentralized development (solar PV, wind, small hydro) • Other technologies (biomass, solid waste, geothermal, solar thermal) • Policy development • Capacity building
• • • • •
Industrial renovation Building EE EE in municipal utilities Electric power system Heating supply system
Country Experience - Mexico
Energy Efficiency Program. Electricity demand in Mexico is expected to grow at 4.8% per year. The EE program seeks to reduce the new generation capacity by supporting efficient air conditioning systems, thermal insulation of buildings, and replacement of old electric motors in industrial and municipal sectors.
Lighting and Appliances Efficiency Program. To reduce electricity demand, the program will support: (a) replacement of mercury vapor lamps with high-pressure sodium vapor lamps in municipal street lighting; (b) replacement of incandescent bulbs with fluorescent lamps in low-income households; (c) replacement of old refrigerators (+10 years) and air conditioners – 1.3 million refrigerators and 288 thousands ACs to save 19 TWh of electricity.
Renewable Energy Program. Mexico relies heavily on fossil fuels for energy (73% of installed capacity). The program will support large-scale wind power projects (1st phase is 500 MW) and a large number of small hydro projects (less than 10 MW each).
Urban Transport Program. The transport sector represents 18% of Mexico’s GHG emissions. The program will support a modal shift toward mass transport systems (such as Bus Rapid Transport Systems) and fuel-efficient vehicles.
Financing Commitments: US$ 6.2 bn
Country Experience - Turkey
Renewable Energy and Energy Efficiency Project. Electricity demand in Turkey is increasing rapidly (7-8% p.a.), and the major domestic source of energy is coal/lignite. The program will: (a) scale up and accelerate the development of modern renewable energy including wind power with a target of 20 GW by 2020, solar, biomass, geothermal, and small hydro; (b) support energy efficiency improvements in industry, including iron and steel, cement, textiles, and chemicals by switch-over to new process technologies and replacement of old equipment (motors, compressors, pumps).
On-lending through commercial banks – lower transaction costs
Clear evaluation criteria
RE --- all renewable energy sources are eligible (defined in the RE Law)
EE --- energy consumption reduction >= 50% incremental benefits, or 20% energy savings in investments
Technical assistance to build capacity among banks and energy service industry
Local banks - identify and assess energy efficiency projects
The private sector – identify and exploit energy efficiency investments
Government institutions - new law and regulations
Investment Plan for Climate Change - Financing Committed: US$3.75 bn
Country Experience- Egypt
Wind Energy Scale-up Program. Egypt has considerable wind power resources (esp., in the Gulf of Suez region) and is targeting 7.5 GW of wind power by 2020. The objectives of are to assist the government to commercialize and scale-up its Wind Energy program
The program will support: (a) building up dedicated high capacity transmission lines to enable wind power integration; (b) establishing a dedicated renewable energy fund to provide price incentives for the transmission company to purchase renewable energy from independent power producers; (c) development of innovative business models for wind power commercialization based on public-private partnership.
Two phases: (i) competitive bidding approach in phase 1 (+2.8GW wind power within 5 years); (ii) feed-in tariff to facilitate private sector participation (+0.5GW per year)
Urban Transport Sector Program. Improvements to Egypt’s transport systems have the potential to produce annual GHG emission reductions of 1.5 million tons CO2 with prospects to triple this amount through replication. The Greater Cairo Region is the immediate focus of the government’s efforts to reduce the emissions along with reducing congestion, improving safety, and reducing local air pollution. The program will support: (a) scaling up replacement of old public buses and private taxis with a new fleet operating on compressed natural gas (CNG); (b) public transport system development including light rail transit (LRT) and bus rapid transit (BRT) systems. .
Financing Committed: US$1.92 bn
District Heating and Building Renovation – East Europe (1)
Comprehensive approach to modernizing district heating
Consumption based billing
Financing building renovation to reduce heat demand and cost to consumer
Technical design: (i) Integrating heat sources via loop network; (ii) Replacing block substations with small, prefabricated, energy efficient building level substations to reduce pumping cost, heat losses and improve quality; and (iii) Retrofitting heat sources for operating efficiency and emissions reduction Training in management Use of international accounting practices and management information systems
Serbia Energy Efficiency Project - $40 million IBRD loan to retrofit schools and hospitals including conversion of oil-fired CHP to gas-fired CHP in largest hospital in Belgrade. Received World Bank Green Award. Loan to Government.
Insulation, windows, improved lighting, fuel switching, connection to district heating – to improve not only energy efficiency and reduce heating costs but also to improve environment for kids to learn (better lighting)
Energy Audits and Investment Proposals done by internationally experienced professional organization and local consultants together
Benefit sharing scheme – agreement between school & local government on how much savings school receives for more education expenses
Dissemination program included: (i) Movie & school materials, and (ii) Monitor placed in each school to show how much energy saved
District Heating and Building Renovation – East Europe (2)
Lithuania Energy Efficiency & Housing Pilot Project
Loans for Residential Energy Efficiency through commercial bank as payment agent
Energy Audits and Investment Proposals prepared by certified energy consulting companies (trained with donor funds, audits and proposals checked by internationally experienced technical group)
Investment projects appraised by central project office
Non-governmental organization established to assist Homeowner Associations with organizing homeowners and making decisions about investment options
Procurement by Homeowner Associations with no objection from central project office
Project financed 90% by loan to Homeowner Associations, 10% from Homeowners
Subsidy Mechanism innovations
30% of loan principal repaid by Government
Repayment by low income people can be made from low income subsidy for heating (subsidy level is calculated on pre-investment energy consumption until share of loan owed by low income person is repaid)
Loans to cities for renovation of schools
Useful Experience for China
The cooperation with China would depend on the provinces circumstances
Scale-up of RE and EE application in industrial, commercial and residential sectors
Power sector (renewable energy, efficiency improvement, advanced technologies) Transportation (modal shifts to public transportation, fuel economy/switching Urban energy (district heating, increasing share of RE, transportation)
Current program:
Advanced generation technologies (USC, IGCC) RE development – onshore wind farms, biomass, PV, small hydro EE through new mechanisms - ESCOs, financial intermediary, provincial EE platform District heating and building energy efficiency
Potential future cooperation
Accelerate RE development
pilot offshore and scaling up onshore wind farms Roof solar plan, tidal energy, biomass, solid waste utilization
EE Financing through the provincial financial intermediary
Power system – efficiency improvement in generation, T&D; CCS; pilot smart grid
Group EE investment in industry - e.g. cement sector Heating and building energy efficiency - pilot in large cities with strong heating companies, duplication in county level
Example – Scaling up and Accelerating New Wind Power Projects China’s Wind Strategy in the 11th five year plan
Scale-up Onshore Wind Bases Northeast and Northwest (Gansu,
Xinjiang, Inner Mongolia) Wind speed >8.0 m/s
Pilot Intertidal Offshore
Initiate Medium-Deep Water Offshore
Equivalent to ―Tantu‖ wind speeds –
perhaps 6.0-7.0 m/s Mostly Jiangsu, Shanghai and Shandong coast
Higher wind speeds than inter-tidal area – but very limited measurements Fujian, Zhejiang, Guandong, Shandong, Jiangsu and Shanghai
Heilongjiang
Xinjiang
Dabancheng
Baicheng
Inner Mongolia
Jilin
Zhangbei
Yumen
Huitengxile
Liaoning Shanxi
Qinghai
Gansu
Shandong
Shanxi
Tibet
HebeiBEIJING
Henan Jiangsu Hubei
Sichuan Chongqing
Inter Tidal Offshore
Anhu i
Hunan
Zhejiang
Yunnan
Huizhou
Jiangxi
Guangxi
Fujian Guangdong
Medium-Deep Offshore
ANNEX Energy Efficiency in Irrigation in China
Energy Efficiency in Irrigation in China
Irrigation and Drainge pumping stations are used for lift irrigation in plateau and hilly areas, drainage in low-lying areas of dense river and canal networks, and water transfers.
Since 1949, China has built some 500,000 fixed pumping stations, in addition to over 3 million irrigation wells.
However, owning to the low levels of technologies available in the past, inappropriate matches between pump products on the markets and application requirements, poor construction quality, as well deferred maintenance resulted from inadequate O& M budget, etc, many such pump systems have deteriorated severely, and been operating at very low efficiency
For example, in Guangdong province, some pumping stations constructed in the late 1960s are operating at an efficiency of about 40% – leading to enormous energy losses and unreliable irrigation and/or drainage services
Energy and Water Efficiency
Middle East and North Africa – analysis of energy efficiency in irrigation sector The total economic cost of energy – including subsidies - for irrigation and drainage in the region is estimated at $4.3 billion—about 9 percent of agriculture value-added on average.
Not every pump is inefficient – Need for advanced monitoring technology
The thermodynamic method is based on the theory that any energy that is supplied to the pumpset, which is not converted into pumping head, is lost in heat, which increases the temperature of the water pumped. It is this increase in water temperature that is used to determine the efficiency of the pumpset.
Water Utilities - Energy and Water Efficiency
Energy cost accounts for a substantial portion of the operating cost in water utilities:
50-70 percent in Central Asia 40-60 percent in China up to 40 percent in Brazil.
Improving EE in water utilities offers significant potential for energy savings, up to 40 percent in Central Asia and China, and 25 percent in Brazil.
An Example in Brazil
By strategically deploying additional water and electricity metering systems and implementing low-cost measures, such as resizing of pumps and power factor correction, Agua do Imperador is reducing annual electricity expenditure by about 15 percent.
Moreover, the private concessionaire could exploit operational synergy between existing water and energy acquisition systems-in particular the installation of micro hydropower turbines in the existing water intake structures-to self-produce 30 percent of electricity requirements.
Overall, these measures have helped the private water utilities reduce its annual electricity expenditure for operations by more than 50 percent in Petropolis.
