““Wind Power in Pakistan:Wind Power in Pakistan:Many Talks, Few Turbines!”Many Talks, Few Turbines!”

BYBY

AVM (R) S J RAZAAVM (R) S J RAZADawood PowerDawood Power

ہے نہیں خوب بہت گرچہ بیاں اندازبات شاید میری جائے اتر میں دل ترے گہ

Those who can – Those who can – DoDo Those who can’t – Those who can’t – TeachTeach

I have slightly modified this to I have slightly modified this to read:read:

Those who can – Those who can – DoDo Those who can’t – Those who can’t – Give Talks!Give Talks!

If a country has these renewable If a country has these renewable resources:resources:

Wind Power PotentialWind Power Potential 350,000 MW350,000 MWSolar Power PotentialSolar Power Potential 600,000 MW600,000 MWHydro Power PotentialHydro Power Potential 50,000 MW 50,000 MW

Tidal Power PotentialTidal Power Potential Not EstimatedNot Estimated

Estimated RE Potential 1,000,000 MWEstimated RE Potential 1,000,000 MW

And yet that country cannot fulfill a meager And yet that country cannot fulfill a meager national requirement of 20,000 MW!! national requirement of 20,000 MW!!

The story does not end here, The story does not end here, the same country also has:the same country also has:

• Coal deposits of 185 billion tons Coal deposits of 185 billion tons that may be equated to that may be equated to

Oil deposits of Saudi Arabia and Iran Oil deposits of Saudi Arabia and Iran combined!!combined!!

• And yet this country does not produce a And yet this country does not produce a single megawatt by coal.single megawatt by coal.

• It rather breaks its back paying for import It rather breaks its back paying for import bill of Oil to meet a part of its power needs.bill of Oil to meet a part of its power needs.

Wait, the story continues…Wait, the story continues…

And the same country developed its own nuclear And the same country developed its own nuclear programme that successfully made it the 7th programme that successfully made it the 7th

entrant to the prestigious “GLOBAL BOMB CLUB”.entrant to the prestigious “GLOBAL BOMB CLUB”.

But this country failed to develop its own nuclear But this country failed to develop its own nuclear power reactors to produce power for its increasing power reactors to produce power for its increasing

needs !!needs !!

As such not a single megawatt is produced by As such not a single megawatt is produced by indigenousindigenous nuclear means!! nuclear means!!

SO, what do you call this country?SO, what do you call this country?

P A K I S T A N!!!P A K I S T A N!!!

Energy MixEnergy Mix

Coal 51% 66% 6%

Oil 35% 20% 30%

Gas 9% 5% 50%

Nuclear 2% 1% 1%

Hydro 2% 7% 13%

Renewable 1% 1% 0%

Power ProductionPower Production

Coal 60% 0%

Hydro 20% 31%

Thermal 11% 66%

Nuclear 3% 3%

Renewable 6% 0%

AFFECTS OF POWER SHORTAGEAFFECTS OF POWER SHORTAGE

• Poor agriculture…no tube wells work…Poor agriculture…no tube wells work…no timely irrigation…hungry massesno timely irrigation…hungry masses

• Poor industrial performance…idle time of Poor industrial performance…idle time of machines increasing…forcing closures…machines increasing…forcing closures…importing stuff from China… losing hard importing stuff from China… losing hard

earned FEearned FE

• Poor industrial growth … shortage of jobs Poor industrial growth … shortage of jobs for the boys coming out of school…for the boys coming out of school…

frustration…increase in crime…madrassah frustration…increase in crime…madrassah population increasingpopulation increasing

• Cottage industry suffered…employment of Cottage industry suffered…employment of women in stitching industry could not be women in stitching industry could not be

multiplied.multiplied.

AFFECTS OF POWER SHORTAGE…AFFECTS OF POWER SHORTAGE…ContdContd

•Textile industry could not function Textile industry could not function competitively…export of cotton competitively…export of cotton

instead of garments…Bangladesh/Egypt instead of garments…Bangladesh/Egypt importing cotton from us, value importing cotton from us, value

adding and exporting garments to earn adding and exporting garments to earn sizeable FEsizeable FE

• Ultimately Pakistan left behind in Asian Ultimately Pakistan left behind in Asian trade and world trade trade and world trade

markets.markets.

Future Power ScenarioFuture Power Scenario

Current 2010 2015 2020

Peak Demand 18,091mw 21,678mw 31128mw 39,372mw

Shortage 2807 mw 926 mw 1572 mw 9634 mw

%Short 15% 5% 5% 25%

The dawn of Alternate Energy occurred in The dawn of Alternate Energy occurred in Pakistan in 2003 with the GOP establishing Pakistan in 2003 with the GOP establishing the AEDB as a one window facilitator for the the AEDB as a one window facilitator for the investor.investor.

AEDB’s target was a minimum of 300 MW of AEDB’s target was a minimum of 300 MW of wind power by 2010.wind power by 2010.

It seemed achievable at that time, but now It seemed achievable at that time, but now that the year 2010 is round the corner, the that the year 2010 is round the corner, the target will definitely slip.target will definitely slip.

ALTERNATE ENERGYALTERNATE ENERGY

• Stakeholders confronted with new Stakeholders confronted with new technologytechnology

• Regulator did not have requisite Regulator did not have requisite knowledge and failed to trust Investors knowledge and failed to trust Investors

• Power Policy and other documents like Power Policy and other documents like the draft PPA, IA etc took time to the draft PPA, IA etc took time to prepare prepare

• Land allotment by Sind Govt took long Land allotment by Sind Govt took long timetime

• Upfront tariff announced was not in Upfront tariff announced was not in touch with realitytouch with reality

• Individual tariff petitions took longer Individual tariff petitions took longer timetime

MAJOR REASONS FOR MAJOR REASONS FOR DELAYDELAY

• Turbine Manufacturers got vary of Pakistan Turbine Manufacturers got vary of Pakistan Market due to the wave of LOI Holders Market due to the wave of LOI Holders approaching themapproaching them

• 2007, security and political stability of the 2007, security and political stability of the country started deterioratingcountry started deteriorating

• Oil price hike caused a boom in wind Oil price hike caused a boom in wind turbine industry, resulting in scarcity of turbine industry, resulting in scarcity of equipment in the marketequipment in the market

• Finally when the oil prices eased out and Finally when the oil prices eased out and so did the wind turbine market, the global so did the wind turbine market, the global financial crisis hit the worldfinancial crisis hit the world

MAJOR REASONS FOR DELAY…MAJOR REASONS FOR DELAY…ContdContd

DAWOOD POWER PROJECTDAWOOD POWER PROJECT

• LOI ObtainedLOI Obtained• Land AllocatedLand Allocated• Soil Survey CompletedSoil Survey Completed• Feasibility ApprovedFeasibility Approved• Generation License ObtainedGeneration License Obtained• Equipment FinalisedEquipment Finalised• EPC Contract SignedEPC Contract Signed• Tariff Determined by NepraTariff Determined by Nepra

Ready to Launch!Ready to Launch!

Ladies and GentlemenLadies and Gentlemen

I wish to end my talk on a positive noteI wish to end my talk on a positive note

YES WE CAN !!YES WE CAN !!

WAY FORWARDWAY FORWARD

All countries are framing policies to All countries are framing policies to support their industry and businesses support their industry and businesses during current crisisduring current crisis

In this hour of trial, we look to the Govt In this hour of trial, we look to the Govt of Pakistan for supporting wind IPPsof Pakistan for supporting wind IPPs

The way forward is Public Private The way forward is Public Private Partnership, providing confidence to Partnership, providing confidence to stake holders.stake holders.

P P PP P P

•AEDB should pick 3 – 5 of the leading AEDB should pick 3 – 5 of the leading projectsprojects

•Form Joint Venture partnerships with Form Joint Venture partnerships with them 40:60 or even 30:70them 40:60 or even 30:70

•Launch at least five projects within 2009.Launch at least five projects within 2009.

This will ensure at least 250 MW of wind This will ensure at least 250 MW of wind energy by end 2010/early 2011.energy by end 2010/early 2011.

RecommendationsRecommendations

• GOP to redraw the power map,GOP to redraw the power map, eliminating load shedding 2015 eliminating load shedding 2015 onwardsonwards• Power production by indigenous Power production by indigenous resourcesresources (renewable, coal, nuclear) be given (renewable, coal, nuclear) be given prioritypriority• Public-Private partnership workable Public-Private partnership workable modelmodel in the power sector be introducedin the power sector be introduced• Dependence on Oil for power Dependence on Oil for power production beproduction be gradually reducedgradually reduced

thank you thank you for your attentionfor your attention

اچھے بہت سخنور میں دنیا بھی اور ہیںاور بیاں انداز ہے گا غالب گہ ہیں گہتے

  Short Term Medium Term (MW)

Fiscal Years 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

TotalExisting/Committed Generation (A+B)

16091 19780 21678 24977 26544 27085 29801 31126 39372 39372 39372 39372 39372

Expected Available Generation (0.85x

C)

13677 16813 18426 21230 22562 23022 25331 26457 33466 33466 33466 33466 31498

Demand (Summer Peak)

16484 17868 19352 20874 22460 24126 25919 28029 28029 32504 34918 37907 41132

Surplus/Deficit Generation

-2807 -1055 -926 356 102 -1104 -588 -1572 5437 962 -1452 -4441 -9634

SUPPLY & DEMAND POSITION: 2008-2020

Prepared by PEPCO System

UPDATED ON 19.9.2008

Coal, 51%Oil, 36%

Gas, 9%

Nuclear,

2%

Hydro,

2%Renewable

, 0%

Coal Oil Gas Nuclear Hydro Renewable

IndiaIndia

Coal, 66%

Oil, 20%

Gas, 5%

Nuclear, 1%

Hydro, 7%Renewable,

6%

Coal Oil Gas Nuclear Hydro Renewable

ChinaChina

Coal, 6%Oil, 30%

Gas, 50%

Nuclear, 1%

Hydro, 13%

Renewable, 0%

Coal Oil Gas Nuclear Hydro Renewable

PakistanPakistan

Renewable

, 6%Nuclear,

3%Thermal,

11%

Hydro,

20% Coal, 60%

Coal Hydro Thermal Nuclear Renewable

IndiaIndia

Coal, 0%

Hydro,

31%

Thermal,

66%

Nuclear,

3%Renewable

, 0%

Coal Hydro Thermal Nuclear Renewable

PakistanPakistan

Project Milestones-DPPL Milestone Date

•Letter of Interest (LOI) Nov 22/04

•Feasibility study accepted by AEDB Dec 26/05

•Land allocated Aug 2006

•NEPRA approval of up-front tariff (unbankable conditions)Sept 12/06

•Generation License Application Nov 2006

•Generation License issued Dec 29/06

•Tariff Petition application Feb 15/07

•Nepra tariff determination Apr 27/07

•Tariff Review Petition May 05/07

•Tariff approval July 07

•Tariff Revised Petition July 08

•Tariff Revised Approval Oct 08

•Turbine Supply Agreement Nov 08

•PPA and IA signing Nov 08

•Financing Closure Dec 08

•Start Construction Mar 2009

•Turbine Delivery Jun - Aug 09

•Commercial Operation Date Mar 2010

45 mths

19 mths

A DIAMOND IN THE A DIAMOND IN THE ROUGHROUGH