Regional Energy Opportunities for Pakistan and Afghanistan Haroon - - PowerPoint PPT Presentation

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Regional Energy Opportunities for Pakistan and Afghanistan Haroon Sharif

Advisor, Regional Economic Cooperation The World Bank SDPI Annual Conference, December 10, 2014

Presentation Outline

• A. Reducing Energy Shortages through Cooperation
• B. CASA-1000
• C. Emerging Regional Markets

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Power wer Sho hortage tages s ar are ha havin ing a h a hug uge im impac act t on j n jobs bs an and growth wth

0.7 0.9 0.9 1.0 1.0 1.1 1.1 1.1 1.1 1.2 1.3 1.4 1.7 1.8 2.2 2.6 0.0 0.5 1.0 1.5 2.0 2.5 3.0 Telecoms Courts BusLicensing Transport LaborReg InadEducLabor Customs AccessLand CrimeTheftDisorder Competit MacroInstability GovPolicyUnc TaxAdministration Corruption Electricity PoliticalInstability Severity of Constraint [0=No Obstacle. 4=Very Severe Obstacle] Expanding Firm Benchmark Firm

Severity of Constraints Reported by SAR Benchmark and Expanding Firms Urban Formal Sector

Al All S l SAR AR coun untries ries su suffe fferin ring g fr from se severe re ene nergy rgy sh shortages ages an and the he si situa uatio ion n is is becomi

• ming

ng worse se

Low access and low consumption per capita High peak shortages are a constraint to growth

• Peak Shortages of 1 GW in Bangladesh, 2-

4 GW in Pakistan and 12 GW in India

• 60 percent of Indian firms rely on captive
• r back-up generation (compared to 20

percent in China)

• In Pakistan, cost of industrial load

shedding to the economy has resulted in loss of 400,000 jobs and US$ 1 billion worth of exports

• In Bangladesh, power shortages have

accounted for GDP losses of 1-2%

• In Nepal, the load shedding amounts to

16 hours a day and are expected to go up to 19 hours a day in the upcoming dry season

AFG NEP BNG BHU IND SL PAK Total 34% 37% 46% 67% 70% 75% 86% Urban 78% 87% 85% 98% 94% 94% 98% Rural 22% 27% 32% 55% 60% 74% 80% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Figure 1: Access to Electricity

Binding Constraints to Growth in South Asia: electricity tops the list

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10 20 30 40 50 60 70 80 90 100

Afghanistan 2005 Afghanistan 2007 Bangladesh 2002 Bangladesh 2007 India 2002 India 2005 Pakistan 2002 Pakistan 2007 Sri Lanka 2004 Total

% Electricity Transport Telecommunication

Kazakhstan

Reserves : Oil 30 billion bbl Natural Gas 85 TCF Coal 31.3 billion tons Hydro Power 20,000 M W

Uzbekist an

Reserves : Oil 594 m illion bbl Natural Gas 66 TCF Coal 3.3 billion tons Hydro Power 1 , 7 00 M W

Turkmeni stan

Reserves : Oil 600 m illion bbl Natural Gas 280 TCF Coal Modest Hydro Power Modest

Taji kist an

Reserves : Oil 0.01 billion bbl Natural Gas 0.2 TCF Coal 3.6 billion tons Hydro Power 40 , 00 M W

Kyrgyz st an

Reserves : Oil 0.04 billion bbl Natural Gas 0.2 TCF Coal .9 billion tons Hydro Power 26 , 00 M W

Kyrgyz Republic and Tajikistan are endowed with vast hydropower potential…

The proposed CASA-1000 transmission facilities would: maximize the use of 1,300 MW renewable summer electricity surplus from existing plants in Central Asia (Kyrgyz Republic & Tajikistan) and provide electricity to consumers in electricity deficient South Asia (Afghanistan & Pakistan)

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The CASA-1000 project includes:

• 500 kV line Datka-Khudjand (477 km),

with Tajik network transferring Kyrgyz exports to Sangtuda.

• Tajikistan Grid Strengthening.
• 1300 MW AC-DC Convertor Station at

Sangtuda.

• 750 km HVDC line Sangtuda-Kabul-

Peshawar.

• 300 MW Convertor Station at Kabul

(with both import & export capability).

• 1300 MW DC-AC Convertor Station at

Peshawar.

8 Final Report of Feasibility Study Update available at:

http://www.casa-1000.org/1)Techno- EconomicFeasbilityStudy_MainRep_English.pdf http://www.casa-1000.org/2)Techno- EconomicFeasbilityStudy_MainRep_Russian.pdf

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CASA1000: Some Project Characteristics

1. Enabling trade of surplus hydro power, initially, from Kyrgyz Republic and Tajikistan to Afghanistan and Pakistan.

– High Voltage Transmission Infrastructure and Systems linking Kyrgyz Republic, Tajikistan, Afghanistan and Pakistan – Brings 1000 MW of clean electricity to Pakistan (300 MW to Afghanistan)

2. Project cost $1.2 Billion; projected completion date 2017-18

– $200 Million contribution of Pakistan and $300 Million for Afghanistan

3. Benefits

– Significant revenues for exporting countries; help fund winter shortages in Central Asia – Meeting severe power shortages in Pakistan and replace polluting fuel oil based power with clean hydro power – Establishes Afghanistan as a viable transit country, enhancing growth prospects

4. Implementation Status

– 80% Financing approved ($550mn from the World Bank) – Commercial agreements signed and Tendering process in place

Possible increases in interconnection capacity

10,000 MW 600 MW 500 MW 1000 MW 500 MW

Source: Based on Govinda Timilisina/The World Bank & An Overview of Energy Cooperation in South Asia (2013)/ADB

10,000 MW

Emergence of a Regional Electricity Market

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• 1. CASA-1000 has opened doors for other countries to use open

access of the transmission line;

• 2. Pakistan and Afghanistan are looking at wider energy

cooperation;

• 3. Pakistan and Afghanistan looking at leveraging the regional

potential;

• 4. A classic example of South Asia – Central Asia Connectivity;
• 5. Narrative shifting from security to economic cooperation;
• 6. Huge demand to fill knowledge gaps and institutional capacity.

TAPI IPI TUTAP CASA 1000 4-Border Interconnection Myanmar- India Nepal - India Bangladesh

• India

Sri Lanka - India Power Transmission Existing Under Construction Projected Gas Pipeline Projected Installed Transmission Capacity: ~1,500 MW Projected Additional Trade Capacity: Power: ~ 4,300 MW Gas: over 180-210 million mscmd

SAARC RC Region

• nal

l Energy Trade e Maste terpla rplan

Iran - Pakistan Pakistan- India 12