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Thursday, 1 March 2012

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The power challenge

The electric power sector is a major contributor to Sri Lanka’s balance of payments problems, due to the need to import fossil fuels for thermal generation, partly because the country has no control over international petroleum prices. However, the process of power planning, over which the authorities did have control, was seriously mismanaged for three decades. It is the cost of that mismanagement for which we are now paying.

A major planning issue was the non-recognition of the part of the powers that be that electricity demand and supply cannot be taken in isolation from other factors, ecological, economic, social and technological. For example, the deforestation of watersheds led to the depletion of retention capacity and hence to heavy discharge during rainy periods combined with mere trickles in dry periods, which means larger reservoirs are required for storage.

Power consumption

The major impacts on power consumption have been economic and social. This is clearly discernible in the manner in which sectoral demand has altered. In the 1970s, industrial consumption accounted for well over half of the total electrical used. The opening of the economy to uncontrolled imports led to the collapse of the manufacturing sector. By 1987, industrial consumption of electricity had fallen to 38 percent; while today it floats around the one third mark.

Incredibly, one single social factor - the introduction of islandwide television services - had greater effect than all others. Earlier the general population used to spend the hours of twilight and early darkness chatting with neighbours at the ‘junction’, on the roadside or verandah, but now sits indoors in front of the TV during peak viewing time.

This practice has led to a sharp peak in electricity demand during these hours, in contrast with the energy consumption pattern in developed countries, where the demand is generally flat at all hours, give or take small fluctuations from the mean. Peak demand is now approximately 2,200 MW, about one third higher than at any other time of the day. After the peak, power demand falls to about 700 MW in the early hours, climbing to about 1,400 MW during the daytime.

Peak hours

With the completion of the Mahaweli hydro-electric projects in the late 1980s, about half of the potential for estimated hydro-electric generation was taken up. At this point, the amount of electricity generated by thermal power stations was smaller than the losses in transmission (15-20 percent of generated power).

In order to cut down on the power losses and to take up extra peak demand, thermal power stations in proximity to the Colombo urban agglomeration were mooted. Ideally, this capacity would have been under the direct control of the Ceylon Electricity Board (CEB) and it would be fully utilised only at peak hours.

Instead, thermal power generation licences were granted to private operators who, for sake of economy, located their plant in distant areas - precluding savings on transmission losses. Since private operators need to maximise profit, power purchase agreements were concluded for generation at non-peak times as well, thereby obviating raison d’etre - the need to bridge the peak demand gap.

The cost of thermal energy being higher than hydro-electric, this meant an increase in power costs all round; it also meant that the cheaper hydro-electricity capacity should be kept idle at off-peak times, further increasing costs.

Wind and solar power generation

While in the 1970s only 10 percent of households electrified, today over 80 percent are; the government expects this to rise to 98 percent by 2016. This has exacerbated the peak demand conundrum, which has led to the introduction of even more thermal plant and hence to rising costs. Today half of our electricity is generated by thermal power stations. The government intends to reduce the thermal requirement by increasing non-conventional renewable generation capacity to 10 percent by 2016 and more thereafter. Unfortunately solar power generation runs (obviously) only during daylight hours, while wind is unavailable in the drought months of March to May.

Electricity generation by renewables will get more important as time goes on, as world petroleum resources get depleted and as costs increase accordingly.

The biggest obstacle is the problem of peak consumption. In order to reduce the peak, the CEB would like to introduce lower off-peak tariffs to commercial and industrial users; this would enable especially industrial users to cut down on costs by working night shifts. However, this is only a partial solution, and will tend only to increase thermal generation.

Anyway, industry consumes a far smaller proportion than it used to.

There are several solutions which could be considered. One of them is Ocean Thermal Energy Conversion (OTEC), which uses the heat difference between the top and bottom of the sea, and for which Trincomalee is considered a good site. The plant would be flexible enough to run at maximum capacity during peak hours. The CEB is also considering energy storage, allowing electricity generated in off-peak hours to be accumulated. Being considered is a proposal by the Mahaweli Authority to re-direct water through a route yielding more power for water to be pumped to higher-elevation reservoirs, for use in peak hours (as is done in developed countries).

Energy tax

Wind and solar power generation could also be usefully deployed for pumping water to higher levels. The CEB envisages that storage chillers could be used by establishments which require air-conditioning during the peak hours (for example cinemas, theatres and restaurants) to utilise electricity generated in the off-peak hours.

There is one further solution, which unfortunately is expensive (but may prove cheaper in the long run). This is to subsidise sales of low-energy TV and similar equipment and impose an energy tax on electricity-devouring plasma TVs. The widespread use of LED (light-emitting diode) TVs instead of cathode-ray sets could cut electricity consumption by two thirds, substantially reducing peak load.

Whatever solutions adopted, this must be done within the framework of a holistic plan, to avoid the type of catastrophic mistakes made in the past.

 

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