Romeo Pacudan-Feed-In Tariff Methodologies and Financing Options for Asia

8/6/2019 Romeo Pacudan-Feed-In Tariff Methodologies and Financing Options for Asia

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FeedFeedFeedFeed----in Tariff Methodologies and Financing:in Tariff Methodologies and Financing:in Tariff Methodologies and Financing:in Tariff Methodologies and Financing:

Options for AsiaOptions for AsiaOptions for AsiaOptions for Asia

FeedFeedFeedFeed----in Tariff Workshoin Tariff Workshoin Tariff Workshoin Tariff Worksho

Asian Development BankAsian Development BankAsian Development BankAsian Development Bank20202020----21 June 201121 June 201121 June 201121 June 2011

Manila, PhilippinesManila, PhilippinesManila, PhilippinesManila, Philippines

RomeoRomeoRomeoRomeo PacudanPacudanPacudanPacudan PhDPhDPhDPhDEnergy Specialist (Consultant)Energy Specialist (Consultant)Energy Specialist (Consultant)Energy Specialist (Consultant)

Asian Development BankAsian Development BankAsian Development BankAsian Development Bank


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Structure of PresentationStructure of PresentationStructure of PresentationStructure of Presentation

RE Promotion PoliciesRE Promotion PoliciesRE Promotion PoliciesRE Promotion Policies

FeedFeedFeedFeed----in Tariff Design Optionsin Tariff Design Optionsin Tariff Design Optionsin Tariff Design Options

Funding OptionsFunding OptionsFunding OptionsFunding Options Final RemarksFinal RemarksFinal RemarksFinal Remarks

test


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Subsidy andgrants

Tax incentives

Feed-in tariff

Regulatorypolicies

1. RE Promotion Policies1. RE Promotion Policies1. RE Promotion Policies1. RE Promotion Policies

from fiscal incentives to regulatory policiesfrom fiscal incentives to regulatory policiesfrom fiscal incentives to regulatory policiesfrom fiscal incentives to regulatory policies

test

nergypayments

Fiscalincentives

Obligations RE Certificates Net Metering


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F UKNO

NEGR

LTUS

C DK

NZ

DK US ITA

H

A P

NE

C UKT K GR

SWD CH J NOF

LB

CBD K T H

NZGR

IRF L

USFI PAAUSITA

DK

UKJ

NO

NECH

SW

E

EFI

AUS

CZ

FID

F UKNO

NEGR

LTUS

C DK

NZ

DK US ITA

H

A P

NE

C UKT K GR

SWD CH J NOF

LB

CBD K T H

NZGR

IRF L

USFI PAAUSITA

DK

UKJ

NO

NECH

SW

E

EFI

AUS

CZ

FID

RD & D

InvestmentIncentives


RE Policy Evolution in Developed Countries:RE Policy Evolution in Developed Countries:RE Policy Evolution in Developed Countries:RE Policy Evolution in Developed Countries:Shift to regulatory policies supported by fiscal incentivesShift to regulatory policies supported by fiscal incentivesShift to regulatory policies supported by fiscal incentivesShift to regulatory policies supported by fiscal incentives

SWBHAUS

NE ITA

DKA

J

DK E HL

AUSACH

D

FI B NE

ITA SW

LJCAUS

DCH PUS ITA

HFAL

ITAUK

PUS K NEDK

E

B SW

D

GRCH NOIR C

CZ

SW

NZ F

IR

NO UK

EU

GR

CZ

J

K

CZ KB

FI K

NOUK

SWBHAUS

NE ITA

DKA

J

DK E HL

AUSACH

D

FI B NE

ITA SW

LJCAUS

DCH PUS ITA

HFAL

ITAUK

PUS K NEDK

E

B SW

D

GRCH NOIR C

CZ

SW

NZ F

IR

NO UK

EU

GR

CZ

J

K

CZ KB

FI K

NOUK

1970 1980 1990 2000

Feed-in Tariffs

VoluntaryPrograms

Obligations

TradableCertificates

Source: IEA 2005


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PolicyInstruments

TaxMeasures

InvestmentIncentives

Feed-inTariffs


RE Policy Evolution and Power Market ReformsRE Policy Evolution and Power Market ReformsRE Policy Evolution and Power Market ReformsRE Policy Evolution and Power Market Reforms

In Europe,In Europe,In Europe,In Europe,

regulatory policies were introducedregulatory policies were introducedregulatory policies were introducedregulatory policies were introduced

when power industries werewhen power industries werewhen power industries werewhen power industries wereliberalizedliberalizedliberalizedliberalized

test

Obligations

TradableCertificates

Power SectorReforms

MonopolyPurchasingAgency

WholesaleCompetition

RetailCompetition


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Monopoly Purchasing

Agency

India Sri Lanka

Wholesale

Competition

Philippines

Sin apore

Retail

Competition

EUcountries


Power Industry Market StructurePower Industry Market StructurePower Industry Market StructurePower Industry Market Structure

Malaysia Thailand China

R of Korea US Canada Japan

power market reforms are slow in Asiapower market reforms are slow in Asiapower market reforms are slow in Asiapower market reforms are slow in Asia various variants exist for purchasing agency modelvarious variants exist for purchasing agency modelvarious variants exist for purchasing agency modelvarious variants exist for purchasing agency model increasing role of the private sector in the generation segmentincreasing role of the private sector in the generation segmentincreasing role of the private sector in the generation segmentincreasing role of the private sector in the generation segment


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TRADABLECERTIFICATES

ITALY

SWEDEN

ROMANIA

POLAND

OBLIGATIONS

BELGIUMNETHERLANDS

1. RE Promotion Policies (1. RE Promotion Policies (1. RE Promotion Policies (1. RE Promotion Policies (DEVELOPED COUNTRIESDEVELOPED COUNTRIESDEVELOPED COUNTRIESDEVELOPED COUNTRIES))))

Combination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market Structures

FEED-IN TARIFFS

JAPANAUSTRALIA

US UK

IRELAND SLOVENIA

SPAIN CZECH

DENMARK

BULGARIA GERMANY LATVIACYPRUS GREECE LITHUANIA

ESTONIA HUNGARY LUXEMBOURG

PORTUGAL SLOVAKIA

ComplexMarket-BasedMeasures


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TRADABLECERTIFICATES

INDIA

OBLIGATIONS

1. RE Promotion Policies (1. RE Promotion Policies (1. RE Promotion Policies (1. RE Promotion Policies (DEVELOPING COUNTRIESDEVELOPING COUNTRIESDEVELOPING COUNTRIESDEVELOPING COUNTRIES))))

Combination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market StructuresCombination of Regulatory Policies Consistent with Market Structures

CHILE

URUGUAY

FEED-IN TARIFFS

ALGERIA ARGENTINA DOMINICAN SOUTH AFRICA

ECUADOR INDONESIA KENYA UGANDA

MALAYSIA MONGOLIA NICARAGUA TURKEY

PAKISTAN SRI LANKA THAILAND

PHILIPPINES

SimplerMarket-BasedInstruments


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2. Feed2. Feed2. Feed2. Feed----in Tariff Design Optionsin Tariff Design Optionsin Tariff Design Optionsin Tariff Design Options

FeedFeedFeedFeed----in Tariff as Guaranteed Price over Fixed Period of Timein Tariff as Guaranteed Price over Fixed Period of Timein Tariff as Guaranteed Price over Fixed Period of Timein Tariff as Guaranteed Price over Fixed Period of Time

GuaranteedGuaranteedGuaranteedGuaranteed

Access toAccess toAccess toAccess to

the Gridthe Gridthe Gridthe Grid

Stable andStable andStable andStable and

LongLongLongLong----termtermtermterm

PurchasePurchasePurchasePurchase

Purchase ObligationPurchase ObligationPurchase ObligationPurchase Obligation

Clear Interconnection RulesClear Interconnection RulesClear Interconnection RulesClear Interconnection Rules


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Payment differentiation and supplementary design optionsPayment differentiation and supplementary design optionsPayment differentiation and supplementary design optionsPayment differentiation and supplementary design options


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Solar PV ProjectsSolar PV ProjectsSolar PV ProjectsSolar PV Projects


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Wind Power ProjectsWind Power ProjectsWind Power ProjectsWind Power Projects


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Power Pool Price + Premium

Renewable Portfolio Standard with RE Certificate

Merchant RE-plants selling into Pool

Degree ofconformity

High


Tariff Regime and Electricity Market CompatibilityTariff Regime and Electricity Market CompatibilityTariff Regime and Electricity Market CompatibilityTariff Regime and Electricity Market Compatibility

Fixed Feed-In Tariff /Lowest Tariff Tender for MW / Negotiated Tariff

Season Dependent Feed-In Tariff

Time of Day Dependent Feed-In Tariff

Feed-In Tariff Benchmarked Against Retail Price + Premium

- enera or e ng ec r c y o e a onsumers

Type of Tariff Setting Regime

marketrules forliberalizedelectricitymarket

Low

Source: kfW 2005


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RatepayerFunding

Thailand FT charge Philippines FIT All

Malaysia RE Fund

RatepayerFunding

Japan Solar Charge China RE Premium

Feed-in Tariff

3. Feed3. Feed3. Feed3. Feed----in Tariff Funding Optionsin Tariff Funding Optionsin Tariff Funding Optionsin Tariff Funding Options

FIT Funding in Asian CountriesFIT Funding in Asian CountriesFIT Funding in Asian CountriesFIT Funding in Asian Countries

Taxpayer Funding Republic of Korea

Government Budget

RatepayerFunding

Sri Lanka India

Funding


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4. Options for Asia4. Options for Asia4. Options for Asia4. Options for Asia

Combination of policy instruments

FIT supported with fiscal incentives

FIT policy combined with other regulatory measures

FIT policy design consistency with

Regulatory frameworks

FIT Funding

Long-term funding stability

Burden sharing and transparency Social and economic impacts considerations

Romeo Pacudan-Feed-In Tariff Methodologies and Financing Options for Asia

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