Bounsy Dethavong - Introduction of Power Sector in Lao PDR

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Introduction of current situationand policy on energy and natural

resources of Lao PDR

Soulivong DARAVONG

Minister of Energy and Mines

Lao PDR

Vientiane, 6 May 2009

Ministry of Energy and Mines___________________________________________________

_______

Introduction of Power Sector in Lao PDR

Presented by: Bounsy DETHAVONG

Deputy Director of DEMManila, 4th June,2012


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Title of Presentation

1. Introduction of Power sector

2. Power Sector policy

3. Power Sector management


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Background of Lao PDR

Area of 236,800 km sq;

16 Provinces + Capital and 139districts;

Population of 5.8 million (2007);

GDP of USD 4.1 billion (2007);

GDP per Capita of USD 701(2007);

Mountainous area with major

tributaries of the Mekong River

covering 35% of total MekongRiver basin.

Relatively high annual rainfall.


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Background of Lao PDR (cont)

Hydropower potential: 23,000MW

Existing installed capacity of 672MW (3%)

Produced energy of 3,500

GWh/Y Produced energy per capita of

700 kWh/Y

Exported energy per capita of320 kWh/Y


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History of Power Sector Development

Memorandum of Understanding on the power exchange

program was signed with the Royal Thai Government in1993 and 1996 under which 3,000 MW is to be suppliedto Thailand and subsequently increased 7,000 MW isagreed;

In 1998 and 2006 MOUs were signed with theGovernment of Vietnam for 3000 MW and subsequently5000 MW is agreed;

In 1999 Agreement on Cooperation in Power Sector wassigned with Cambodia;

Power Sector Strategy developed and updated fromtime to time;

Power sector opened to private foreign directinvestment;

Legal framework has been improved from time to timeto meet international financing requirements.


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2. Power Sector Policy

Maintain and expand affordable, reliable and sustainableelectricity supply to promote economic and socialdevelopment;

Promote power exports as well as domestic power supply toearn revenues to meet Government development objectiveswith particular emphasis on poverty eradication;

Develop and enhance the legal and regulatory framework tofacilitate power sector development by either public, private orpublic private partnership;

Gain capacity building through international technical know-how and expertise;

Ensure accountability and transparency of environmental andsocial impacts and thereby achieve sustainable development


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Objective of the Power Sector Development

Propovide a source of foreign exchange to fundeconomic and social development and alleviate poverty;

Meet the commitments under intergovernmental MOUsand Agreements with Thailand, Vietnam and others;

Extend rural electrification to promote better socio-economic development and reach the government targetof 70% and 90% by year 2010 and 2020 respectively;

Integrate power sector and maintain its economicdevelopment as a whole with international communitiestrough its power exchange programs and foreign directinvestment.


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Renewable energy Policy

Increase a share of bio-fuel consumption inTransport Sector up to 30% by 2020;

Establish a National Policy of Renewable

Strategic Policy; Establish a National Strategic Plan for Bio-

fuel development.


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Development Status

65 Projects with estimated installed capacity of 20,000 MW

Projects at Feasibility Study stages/with Memorandum of

Understanding (MOU): 35 Projects with estimated installed

capacity of 7.270 MW

Projects at Preparation stage/with Project Development

Agreement (PDA): 27 projects with estimated installed capacity of

7.618 MW

Projects under Construction / with Concession Agreement (CA):

10 Projects with installed capacity of 4.360MW


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For electric generation and consumption, hydropowertype comprises of 99.8% of total, the rest is diesel

generation and solar photovoltaic sets.

Electrification ratio is estimated at 60% in 2008.

Development Status (cont)


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Ownership of Generation

- 2004

44.6%

52.5%

2.9%

- -

-

-

EDL IPP PROVINCES

IPP EDL

PROVINCES

Installed Capacity: 2,534.2 MW: EdL 875 MW

IPP: 1.639.2 MW, Provincial: 20 MW

34.52

64.68

0.789


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Power Sector monitoring, inspection and examinationwere followed by Legal system for example

Electricity Law, Water and Water resources Law,

Environmental Law, Land Law, Forestry Law,Lao

Electric Power Technical Standards and so on and sofort.

3. Power Sector management


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Instructions: LEPTS Procedure of Electric Power Project in Lao P.D.R.

Memorandum ofUnderstanding (MOU)

Project Activity

Project DevelopmentAgreement (PDA)

Concession Agreement(CA)

Feasibility Study (FS)

Agreement betweenGovernment & Project

Interim Letter ofApproval to FS

(if any or as necessary)

Government Activity(MEM Activity)

( planning stage )

( detail design stage )

Final Letter ofApproval to FS

Feasibility Study (FS)

( construction stage )

Commencement ofOperation

Completion Certificate

Construction

Design Criteria withBasic Design

(Form2 and Drawings)

Tender Documents(Detailed Technical

Specifications)


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