3rd Mekong Forum on Water, Food & Energy 2013. Presentation from Session 14: Alternative electricity sources and planning for the Mekong.

1. Potential for increasing the role of
renewables in Mekong power supply
(MK14)
CPWF Mekong Forum – Session 12, 20 November 2013
Solar PV in Vietnam: Power sector
benefits, costs and policy
Nguyen Quoc Khanh
26.11.13
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2. Content
1. Solar PV for commercial buildings: power sector benefits
2. Potential of solar PV development in commercial buildings
3. Economics of building solar PV and the proposed supporting
mechanism
4. Volatility of solar PV
5. Prospect for solar PV applications
6. Summary of policy options for solar PV
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3. Solar PV in commercial buildings: Power sector
benefits
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4. Correlation between solar PV output and building
load demand
•
High correlation between solar PV
and building load demand which is
characterized by cooling demand
•
The difference happens after 5:00
pm when solar PV stops generating
power while the building is still in
operation
→ Solar PV could be installed on building rooftop to meet its demand
→ Highly relevant for the south where solar radiation is quite stable
throughout the year
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5. Benefits to the power sector
•
•
•
Save transmission and distribution cost
Reduce transmission and distribution losses
Avoid the need for high cost power generation
Power can be
produced at the users
using e.g., solar PV
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6. National load curve in Viet Nam
National: 2 peaks
 Morning peak: 10-11am
 Evening peak: 18-19 pm
The South: 2 peaks
 Morning peak: 10 am
 Afternoon peak: 15
pm
14000
12000
10000
MW
8000
6000
4000
The South load curve contributes 50-55%
to the national load.
2000
2009 Trung Ngày LV
2009 Nam Ngày LV
23:00
22:00
21:00
20:00
19:00
18:00
17:00
16:00
15:00
14:00
13:00
12:00
11:00
10:00
9:00
8:00
7:00
6:00
5:00
4:00
3:00
2:00
1:00
0:00
0
2009 Bắc Ngày LV
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7. Potential of solar PV development in commercial
buildings in Viet Nam
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8. Potential of solar PV development for hotels in Ho
Chi Minh city (demand side)
•
Overlay typical solar PV production curve to typical load curve of
Hotels
•
Adjust solar PV electrical generation capacity so that the peak load
section of the hotel’s load curve is minimised.
MW
50.0
45.0
40.0
35.0
Typical load curve of hotels
in HCM city
30.0
Installable capacity of solar
PV in hotels in HCM city
25.0
20.0
Load curve of hotels in HCM
city with solar PV
15.0
Solar PV
potential
(demand
side): 47 MW
10.0
5.0
0.0
1
3
5
7
9
11 13 15 17 19 21 23
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9. Potential of solar PV development for office
buildings in Ho Chi Minh city (demand side)
•
Overlay typical solar PV production curve to typical load curve of office
buildings
•
Adjust solar PV electrical generation capacity so that the peak load
section of the office buildings’ load curve is minimised.
60.0
50.0
Typical load curve of office
building in HCM city
40.0
30.0
Installable capacity of solar
PV in office buildings in HCM
city
20.0
Solar PV
potential
(demand
side): 66 MW
Load curve of office buildings
in HCM city with solar PV
10.0
0.0
1
3
5
7
9
11
13
15
17
19
21
23
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10. Available rooftop area for installing solar PV system
sufficient?
•
•
Total floor area: 29,000 m2
Roof area: ~ 2000 m2
-> able to accommodate 250 kWp solar PV system
Less than “optimal” solar PV capacity: 1.5 MWp
Develop ground mounted
Develop ground mounted
solar PV
solar PV
Note: Metropolitan building, TP HCM
Figure:
ground
mounted
solar PV at
Bangchak,
Attuthaya,
Thailand
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11. Potential of ground mounted solar PV
Selection criteria
•
•
Solar radiation: ≥ 5 kWh/m2/day
Suitable areas:
• Waste land with flat topography and with road and grid, close
to load centers
• Distance from road: ≤2 km
• Distance from electrical grid: ≤ 5 km
• Land slope: ≤ 5o
•
•
GIS assisted approach
•
•
Mainly concentrate in the southern region
Total suitable area identified: 441 km2 , able to
accommodate 22,000 MWp
Ninh Thuan has the greatest potential of approx
4,600 MWp
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12. Economics of solar PV and the proposed supporting
mechanism
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13. Economics of solar PV
 Economics of solar PV are largely determined by 2 main variables:
 Investment cost
 Power output
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14. Specific investment cost
Source: http://www.solarserver.com/service/pvx-spotmarket-price-index-solar-pv-modules.html
Source: http://www.solarwirtschaft.de/preisindex
 Specific investment cost: 2,0 $/Wp
 Solar module: 0,7 $/Wp
 Inverter: 0,3 $/Wp
 Others: 1,0 $/Wp
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15. Power output and the levelized cost
 Power output depends on solar radiation, solar PV types and the tilted angle
and direction of the solar panel installation
Reference values
Full load hours: 1500 hours/year, or
Capacity factor: 17%
Cost: 17,65 $ cent/kWh
or 3.795 đ/kWh
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16. Value of solar PV: power system avoided cost versus
user avoided cost
Electrical selling price for commercial
customers in 2012 (đ/kWh)
Avoided cost tariff in 2012
Dry season
Wet season
Peak
hour
Norm
al
hour
Off
peak
Peak
hour
Nor
mal
hour
Off
peak
Leftov
er
power
619
589
638
596
583
629
554
551
596
596
549
583
557
538
574
538
533
559
269
267
279
Energy cost
(đ/kWh)
Northern region
Central region
Southern region
Capacity cost
(đ/kWh)
+ Peak
3,715
+ Normal
2,177
+ Off-peak
1,343
1,805
Source: Decision No.06/QĐ-ĐTĐL dated 19/01/2012 Electricity Regulatory
Authority of Vietnam
Wet Season: from July 1st to October 31st
Dry season: from Nov 1st to June 31st
Average buying price: 928 đ/kWh
<< Average selling price: 2,563 đ/kWh <<
Levelized cost: 3,795 đ/kWh
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17. Supporting mechanism for solar PV
Supporting mechanism for solar PV in Europe
• Feed-in tariff (FIT) is the most
common mechanism
• Vietnam is applying FIT for
renewable energies
• FIT has been applied for wind
power
• FIT is being developed for
biomass power
Source: EPIA
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18. FIT estimate for rooftop solar PV
Inputs
•
•
•
•
•
•
Generic solar PV system: 20 kWp
Specific investment cost: 2 $/Wp
O&M cost: 1.5% of total investment
Capacity factor: 17%
Full load hours: 1500 hours
Lifetime: 20 years
•
•
•
•
•
Financing: 20% equity, 80% loans
Loan interest: 6% p.a , Loan term:
15 years
Corporation income tax: 10%
Depreciation: 20 years
Hurdling FIRR: 16%
→ FIT rate: 19.5 US cent/kWh
Equal to 4,193 đ/kWh
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19. FIT estimate versus Thailand FIT tariff
Estimated
• FIT rate: 19.5 US cent/kWh, equal
to 4,193 đ/kWh
• Duration: 20 years
FIT in Thailand
Rooftop solar PV package
Size
0-10kW
FIT rate FIT rate
(Baht/kWh) (đ/kWh)
6.96
4,628
10-250 kW
6.55
4,356
250 kW-1 MW
6.16
4,096
Quota
100 MW
100 MW
1 MW/1 commune package
Year
1-3
FIT Rate FIT Rate
(Baht/kWh) (đ/kWh)
9.75
6,484
4-10
6.50
4,323
11-25
4.50
2,993
Source: http://thaisolarpvroadmap.org/wordpress/?p=940
• Thailand solar PV target 3000 MW by
2025
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20. Other incentives
Financial incentives
• Tax: Preferential import tax and corporate income tax exist
• Investment: has been stated but not really in operation
Non-financial incentives
• Update existing grid code
 Circular No.32/2010/TT-BCT dated 30 July 2010 applies all power
generation technologies that are connected to power distribution
network
 It does not consider the presence of renewable energy
technologies, especially those with large fluctuation output
• Develop a solar PV development plan
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21. Volatility of solar PV output
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22. Volatility of solar PV output
The correlation is high
between building load
demand and solar availability.
So PV provides power when
needed, thus displacing peak
energy and reducing demand
The correlation between PV
output and load demand is
normally high. But localized
demand reduction might be
hindered by occasional clouds
Source: Christy Herig, National Renewable Energy Laboratory,
Using Photovoltaics to Preserve California's Electricity Capacity
Reserves
The Solar Load Controller (SLC)
reduces the load when needed
by acting on end-use setting or
scheduling. Because of the
naturally high correlation
between PV and load, the enduse inconvenience is minimal
compared to the demand
reduction enhancement
SLC installation is applied only when the incentives such as FIT is established,
probably as a condition to receive incentive.
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23. Prospect for solar PV
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24. Climate Change increase numbers of hot day
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25. Further investment cost improvement
Prospect of global Solar PV market
Price and cummulative
production volume
Source: Global market outlook for Photovoltaics 2013-2017
PV generation cost will approach grid
parity once it reaches an
investment cost of 1$/Wp
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26. Summary of policy options
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27. Summary of policy options
Option 1 – Business As Usual
 No FIT
 Market driven
 Support Net Metering
Option 2 – Promotion
 Price incentive (FIT)
 SLC as a condition
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28. Thank you
Mekong Forum | 19-21 November 2013
Nguyen Quoc Khanh
(mail2knguyen@yahoo.com)
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