Ps2_kok Seng Loo (Tnb)

AESIEAP CEO Conference 2013

Green and Smart Energy in TNB: Development & Perspective

28th October 2013, Seoul Korea

Loo Kok SengSenior General Manager

Corporate Planning & Sustainability DepartmentTENAGA NASIONAL BERHAD

Background 1

Energy Mix and Challenges2

Green Initiative & Development3

Presentation Outline

Closure

Smart Energy Perspective & Development4

5

PENINSULAR

MALAYSIA

SARAWAK

SABAH

Sabah Electricity Sdn Bhd SESB)(A 83% TNB Subsidiary)

Sarawak Electricity Board (SEB)

Tenaga Nasional Bhd(TNB)

SINGAPORE

BRUNEI21,749MW*

1,237MW

1,141MW*

695MW

* Includes IPPs

Major Electricity Utilities in Malaysia

3

58%33%

9%

43%

466%

6%5%

Gas Coal Hydro & Others Oil & Distillate

INSTALLED CAPACITYTNB : 52.7%IPP: 47.3%

GENERATION MIXTNB : 48.0%IPP: 52.0%

TNBFY’09 FY’10 FY’11 FY’12 1HFY’13

TNB -Peninsula

Installed Capacity (MW)11,530 11,530 11,530 11,462 11,462

Total units sold (GWh) 87,780 95,197 97,888 102,132 52,129

Total customers (million) 7.59 7.87 8.11 8.36 8.47

Total employees 29,149 30,535 31,935 33,568 34,353

Total assets (RM billion) 71.4 75.9 79.1 88.5 88.3

Peak Demand Peninsular Malaysia (2013): 16,562 MW, Installed capacity: 21,749 MW & Reserve Margin: 31.3 %

Background 1




Closure


5

Seeking a close to optimal and sustainable balance is a major challenge…

FOUR major elements creating a set of complexity, requiring a delicate balance to achieve a close to optimal equilibrium state for sustainability, security and stability

ENERGY SECURITY COMPETITIVE COST SUSTAINABILITY SAFETY ASPECTS

5

increasing demand growth & depleting

energy resource pose

fuel security issues

Cost efficiency of generation choices e.g.

solar is green but at higher

cost

Climate change & sustainability goals, often

conflicting with cost-

competitiveness and energy

security

Safety & regulatory

aspects of fuel of choice

Major Challenges from Utility Perspective towards Sustainable Future

6

Escalating electricity demand due to high

GDP growth averaging 4-5% p.a.

Require significant resources to meet

demand

High dependency on fossil fuels (more

than 90% from gas and coal)

Reliance on 100% imported coal - issue

on energy security

Increasing cost of supply

Rationalising energy subsidies and

recovery of higher cost of supply

Reduction of CO2

emission & low carbon economy

Commitment to reduce up to 40% in emission intensity of

GDP in year 2020 compared to 2005

levels

Increasing pressure on energy security

Availability and reliability of energy

resources

Provides opportunity for harnessing the benefits of green options and smart energy

Fuel supply security: Indigenous Crude oil & Natural Gas Reserve are fast depleting…

Proven Oil Reserves at the End of 2012

World 1668.9 thousand mill barrels

Asia Pacific 41.5 thousand mill barrels

Malaysia 3.7 thousand mill barrels

7

Proven Oil Reserves at the End of 2012

World 187.3 trillion cubic metres

Asia Pacific 15.5 trillion cubic metres

Malaysia 1.3 trillion cubic metres

Proven Natural Gas Reserves at the End of 2012

Source: BP Statistical Bulletin 2013: Malaysia gas production in 2012 is 65.2 billion cubic metres per year

The Evolution of Capacity & Generation Mix from Dominant Oil to Sustainable Energy Mix

8

Future Green & Smart Energy Options for Power Sectors

2020 and beyondProliferation of Renewable Energy

EE & DSM/DR an “alternative supply option”

“More Distributed Generation”/Net

9

2012

• Predominantly fossil-fuel generation

• Specific Generation Sites/Hub

Energy Efficiency

ASEAN Power Grid – Generation Option

Existing InterconnectionExisting Interconnection

• Peninsular Malaysia –Singapore (1986, 2 x 200 MW)

• Peninsular Malaysia – Thailand

• HVAC Bukit Ketri – Sadao(1981, 85 MW)

• HVDC Gurun – Khlong Ngae(2001, 300 MW)

10

•Sarawak and Sumatera interconnections are viable options to increase energy security•The Singapore & Thailand interconnections enhanced system security for all parties

Potential InterconnectionPotential Interconnection

• Peninsular Malaysia – Sarawak (~2022)

• Peninsular Malaysia – Sumatera (~2018)

• Peninsular Malaysia – Thailand (2015, 2nd 300MW HVDC)

Note: HAPUA – Head of ASEAN Power Utilities and Authorities, Incepted under AMEM10

Background 1


Green Initiatives & Development3


Closure


5

National Energy Policies and Development Plan

8th Malaysia Plan (2001-2005)

RE as the fifth fuel

Target: 5% RE in energy mix

National Energy Policy

(1979)

National Depletion

Policy (1980)

National Fuel Policy (1981)

National Fuel Policy (2001)

National Green

Technology Policy (2009)

12Source: Ministry of Energy, Green Technology and Water, Energy Commission

9th Malaysia Plan (2006-2010)Target: 300 MW grid-connected RE in Pen. Malaysia

Target: 50 MW grid-connected RE in Sabah

10th Malaysia Plan (2011-2015)New RE Policy and Action Plan

Target: 985 MW of RE by 2015 (~5.5% of energy mix)

Renewable Energy (RE) And Green Initiatives (10th M’sia Plan)

<201110th Malaysia Plan (2011-2015)

Target: 985 MW RE by 2015 (5.5% of generation mix)

•National RE Policy to enhance

utilisation of indigenous RE resources

to contribute towards national

electricity supply security and

sustainable socio-economic

development

•RE Act passed in Apr 2011

•Eco-labelling scheme and standards

(i.e. Efficiency Star Rating, Low

Carbon Footprint Product, Green

Building Index)

•Electrical Appliance Save Programme

(~RM50 mil - rebate programme for

new & efficient air conditioner &

Malaysia’s Voluntary Pledge

in COP15 in 2009

“voluntary reduction of up to 40%

in terms of carbon emission

intensity of GDP by year 2020

compared to 2005 levels.

….conditional on receiving the

transfer of technology and finance

of adequate and effective levels

13

Fiscal incentives:

• Pioneer Status

• Investment Tax Allowance

• Import duties and sales tax

exemption

• Green Technology Financing

Scheme (GTFS) with RM1.5

billion fund to provide soft

loans

•RE Act passed in Apr 2011

•Feed-in-Tariff (FiT) from Dec 2011

(about RM300 mil p.a.)

•RE Fund

•Sustainable Energy Development

Authority (SEDA) established in 2011.

SEDA is to manage the implementation

of the FiT mechanism which is

mandated under the Renewable

Energy Act 2011 [Act 725]

new & efficient air conditioner &

refrigerator)

•Phasing out of incandescent light

bulbs by 2014

• Improving solid waste management

including energy generation from

solid waste

•Clean Air Action Plan

•Gradual removal of gas subsidy

•Guidelines for green townships across

the country

of adequate and effective levels

from Annex 1 countries

Renewable Energy Status in Malaysia

Year Biogas Small HydroBiomass ( Solid

Waste )Biomass

Biogas ( Landfill / Sewage )

Solar PV Total

2012 2.13 0.00 0.00 12.50 5.20 29.22 49.04

2013 5.10 28.30 0.00 48.50 4.00 94.28 180.18

2014 2.40 49.05 11.09 30.00 1.20 31.40 125.15

2015 0.00 22.00 0.00 0.00 0.00 0.00 22.00

Cumulative 9.63 99.35 11.09 91.00 10.40 154.88 376.37

Biogas ( Landfill / Biomass

Installed Capacity (MW) of Commissioned RE Installations

Installed Capacity (MW) of Plants in Progress

14

Year BiogasBiogas ( Landfill /

Sewage )Biomass

Biomass (Solid Waste )

Small Hydro Solar PV Total

2012 2.00 3.16 43.40 8.90 15.70 31.36 104.52

2013 1.25 0.00 0.00 0.00 0.00 8.75 10.00

Cumulative 3.25 3.16 43.40 8.90 15.70 40.11 114.52

Year BiogasBiogas ( Landfill /

Sewage )Biomass

Biomass ( Solid Waste )

Small Hydro Solar PV Total

2013 1528.05 2994.11 122369.13 4212.76 42620.40 12218.18 185942.63

2012 98.11 2798.72 97019.06 3234.52 25629.78 4371.18 133151.37

Source: Sustainable Energy Development Authority of Malaysia (SEDA Malaysia), www.seda.gov.my ( 28th August 2013)

TNB (Utility) is the agent for FIT collection for Peninsular Malaysia (1% of electricity bill)

Power Generation (MWh) of Commissioned RE Installations

Renewable Energy Projected Growth for Malaysia

Year Biogas Biomass Solid Waste Small Hydro Solar PV Total

2011 20 110 20 60 9 219

2012 35 150 50 110 20 365

2013 50 200 90 170 33 543

2014 75 260 140 230 43 753

2015 100 330 200 290 65 985

2016 125 410 240 350 84 1209

15

2016 125 410 240 350 84 1209

2017 155 500 280 400 105 1440

2018 185 600 310 440 129 1664

2019 215 700 340 470 157 1882

2020 240 800 360 490 190 2080

2025 350 1190 380 490 455 2865

2030 410 1340 390 490 1370 4000

Table A1: RE Capacity Target (MW), SEDA Website Assumptions:

TECHNICAL POTENTIAL

• Biomass (EFB, agriculture): 1,340 MW will be reached by 2024

• Biogas (POME, agriculture, farm): 410 MW will be reached by 2028.

• Mini-hydro (not exceeding 30 MW): 490 MW will be reached by 2020.

• Solar PV (grid-connected): unlimited.

Source: Sustainable Energy Development Authority (SEDA) website , 2013,

Power sector contributes for a significant share of the total CO2 emissions in Malaysia

% of the total CO2 emissions in 2005

~32%~24%~21%~12%

PowerOil & GasTransportPalm Oil

~11%

Others

~47%2020 projection

(BAU scenario)1

… highly dependent

on fossil fuels for

electricity generation

16

1980 2005 2010 2020F

Hydro

Coal

Gas

Oil

% of generation mix (Peninsular Malaysia)

79%

4%

72%

23%

58%

37%

31%

63 %

Energy

66%Land Use

Change

and

Forestry

13%

Waste

12%

Agriculture

3%

Industrial

Processes

6%

Total: 223.1 Mt CO2eq 2

Source:

1. Khazanah Analysis 2010

2. National Communication 2, 2011: Green House Emission for the year 2000

Solar Biomass Biogas Mini-Hydro Solid Waste

Potential

•~6,500 MW

Potential

•~1,340 MW by

Potential

• ~410 MW by 2028

Potential

• ~490 MW by 2020

Potential

• ~360 MW by 2022

Estimated National RE Resources & Potential

Source: Ministry of Energy, Green Technology and Water, Energy Commission, (2010); SEDA website 2013

•~6,500 MW

•Yearly average

irradiance 1,400 –

1,900 kWh/m2

Status

•166 MW by 2014

(FiT)

•MBIPV Projects

(SURIA

1000, demo/showc

ase projects etc.)

•~1,340 MW by

2030

Status

• ~70 MW under

development as of

June 2013

• Biogen

Project, palm oil

waste

(EFB), woodchips,

paddy husks etc.

• ~410 MW by 2028

Status

• 16.3 MW under

development as of

June 2013

• Palm Oil Mill

Effluent

(POME), livestock,

agro, industrial

waste

• ~490 MW by 2020

Status

• 28.3 MW under

construction as of

June 2013

• Run-of-river

scheme with

minimum

impounding

• ~360 MW by 2022

• ~21,000 tonnes of

waste collected

every day in M’sia

Status

• 11.1 MW (FiT

approvals) by

2014

Others: Wind, geothermal, ocean-thermal, tidal wave etc.

17

TNB (Utility) Sustainability Projects

Renewable Energy (RE)

• Off- grid installations – Solar Hybrid Stations (SHS)

• Feed in Tariff (FiT)

• Biomass JV with Felda - In progress

Energy Efficiency (EE)

• Energy audits and consultancy at TNB and private buildings

• Carbon foot print studies at Generation and Transmission sides

• Pilot EV charging

Smart Grid (SG)

• SG Pilot project (Smart Meter, AMI, ICT Integration, DR)

• Formulation of Smart Grid Maturity Model (SGMM)

• SG Realisation Plan

Demand Side Management (DSM)

• DSM Study & Enhanced TOU formulation

• Energy awareness programmes

• Development of training and capacity building centres

18

progress

• Biogas JV with Sime Darby Plantations - In progress

• Mini-hydro JV with AmcorpPower – (in progress)

• Solar Farm (JV) -under study

• Roof-top PV for offices

• Pilot EV charging terminal

• Thermal Energy Storage (TES); Bangsar Energy System -completed, Kuala Lumpur International Airport 2 (KLIA2) –in progress

• SG Realisation Plan

• SG testbed

• SG Specific Site Feasibility Studies

capacity building centres

Source: TNB GREENER Committee, June 2013

Potential Indigenous Energy Resources Including Low Carbon Energy Resources

• On-going High Efficiency Coal-fired

Supercritical Boiler Project - Janamanjung

(1000MW) & future coal power plants

• Currently TNB is developing Hydro

projects; Hulu Terengganu (250 MW) and

Ulu Jelai (372 MW) to be commissioned in

2015/16

• Potential zero carbon emission hydro

19

• Potential zero carbon emission hydro

electric projects proposed totaling to 765

MW (post 2020) i.e.

Chenderoh, Tembat, Sg.

Pelus, Nenggiri, Telom & Tekai

• TNB JV Development on RE i.e project on

10MW Biomass Plant Jengka; other Biogas

and Solar projects;

• Operations of Mini Hydro Plant total 23.5

MW

TNB’s Commitment To National Carbon Reduction Program

RENEWABLE ENERGY• Turnkey EPC Contractor:

� Solar Hybrid Project under Ministry of Education� Solar Hybrid project for POS Kemar under Ministry R&RD

• Operation & Maintenance (Long-term Service Agreement):� 42 Solar Hybrid Stations & 28 Mini Hydro Stations

TNB successfully implemented numerous RE/Carbon Reduction projects valued

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ENERGY EFFICIENCY• Built, operate, maintain District Cooling Project - > 10 major projects • Energy Efficiency Audit and Solution:

� More than 20 major commercial buildings• Power Quality Services and Consultancy:

� More than 100 major customers

CONSULTANCY• Power System Study for RE plant interconnection to TNB grid• Interconnection Facility (IF) consultant• District Cooling Study for area development

Capacity Building & Competency Development On Green EnergyCollaborative Training and Capacity Building among staff via:

� Sustainability Development modules at TNB Institute - ILSAS

� R&D on Carbon Emission Reduction projects – TNB Research

� Centre for Renewable Energy (CRE) at Universiti Tenaga Nasional (UNITEN)

� Institute of Energy Policy and Research (IEPRe) at UNITEN.

TNBR Solar Research Centre

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Background 1




Closure


5

Future ‘smart’ transformation of the electricity supply industry via Green & Smart Energy…

Current Future Key changes

Generation

Hydroelectric

Coal power plant

Gas power plant

Wind energy EnergyStorage

Solar energy

� Fluctuating capacity factor

� Decentralised & Distributed generation

� New energy sources -seamless integration with conventional sources

� Sustainable & renewable energy sources

� Generation mix migration

Transmission

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� Flexible and fluid infrastructure

� Two way flow of communication and data

� Smart Grid infra include smartmeters facilitate multi direction flow of data and energy

� New offering and revenue stream

� “Prosumer“– consumer consume & produce

� Customers access to more information to manage its demand and cost

� Increase reliability & efficiency for utility

Distribution

Metering Conventional meter Smart Meters

Retail

Energy flows to user

Energy bi-directional flow

TNB Smart Grid (SG) Project Implementation Stages (1)

PHASE 1 PHASE 2 PHASE 3

24


ACTIVITY 1 DA/DMS1. Security

Assessment

2. Loss optimization

3. Fault

location, isolation

& restoration

4. Automatic feeder

reconfiguration

AMI1. Install 1000

Smart Meters at

Pilot Sites

2. Proof of

Concept

3. Metering Data

Management

System

ICT Infrastructure

and System

Integration1. Integration of data

information systems

e.g. AMI &

eCIBS, MFFA, CGIS, T

OMS, SCADA

Demand

Response

SMART GRID

PILOT PROJECT

Implementation

CGIS, Online Condition

Monitoring

��Completed at 2 pilot sites ��Secured Govt Funding

TNB Smart Grid (SG) Project Implementation Stages (2)


25


TNB Smart Grid Maturity Model

1. Smart Grid Information Centre

2. Test Bed for Future Smart grid Applications

3. RE & EV

4. Intelligent Microgrid

5. Smart Meter/AMI project CFT

6. Customer & Stakeholder Engagement

7. Promotes DSM, DR and EE incl. ETOU

8. Specific site JV feasibility site

9. Enhance operation & asset management with SG

ACTIVITY 2

INITIATIVES FOR

LONG TERM

SMART GRID

DEVELOPMENT &

REALISATION

TNB Smart Grid Realisation Plan (‘Precinct’)

Smart Grid Promotes DR, DSM & EE

�Enable peak load reduction

� Information on Energy Usage� Customer awareness of their load

(consumption) profile� Incentivise Off Peak consumption

Energy Demand

Peak load reduction

Consumption Behaviors

Changing customer energy consumption behaviors

� Incentivise Off Peak consumption

Hours of the day

26

TNB SG A Journey & Enabler to A Greener Economy

Optimising demand & supply

(generation) & new biz/process

Enhanced efficiency in GTD & utilisation

DSM, DR, Automatic Load management &

peak shaving

SMART GRID VALUE ADD SERVICES

Smart Grid – a crucial initiative to achieve sustainable growth:

�Fulfillment of our CO2 emission pledge

�Enhanced electricity supply reliability

�Enhanced efficiency of GTD & consumption

�Integrating Renewable (balancing generation & demand)

�DSM and Demand Response (peak avoidance)

�Loss prevention

TNB is implementing smart grid pilot projects

27

Enhance Reliability via automatic outage

prevention and restoration

GTD & utilisation

automated loss prevention and enhanced service at

distribution /customer end

TNB is implementing smart grid pilot projects

�3+2 sites

�3 phases of implementation

�Target completion by 2015

�Specific site SG Feasibility Studies (JV)

TNB Smart Grid Realisation Plan (2013-2020)

Background 1




Closure


5

Closure

• Malaysia Electricity Supply Industry (MESI) is confronted with major challenges due

to the constantly changing scenario interspersed with numerous uncertainties and

complexities intermitently. This inlcude increasing demand & national economic

transformation plan, depleting indigenous energy resources in particular gas,

fluctuating/escalating fuel prices, environmental concern and higher expectations

from the customers & stakeholders in addition to the requirement of low carbon

economy.

• TNB is committed towards the national green objectives and a sustainable ESI.

This include implementing projects/initiatives to meet continuous demand growthThis include implementing projects/initiatives to meet continuous demand growth

via new generation capacity, diversified fuel mix & fuel supply, enhanced pricing

mechanism and related reticulation (T&D) infrastructures that are more efficient.

The Green & Smart Energy (sustainable) related technologies being introduced

include RE, EE,DSM & DR, Smart Grid etc.

• The Green and Smart Energy development will require more fiscal & government

support and public-private partnership in moving towards greater RE based

generation and more efficient options such as EE, DSM, DR ,Smart Grid etc. This is

to spur efficient utilisation of scarce energy resources and a greener economy.

THANK YOUTHANK YOU

www. tnb.com.my

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