International Conference

Renewable Energy Asia 2013-New Opportunities in the ASEAN

Community-Focus on Renewable Energy and Energy Efficiency
The Current Policy and
Investment Opportunities in Laos
Chantho Milattanapheng
Deputy Director General
Institute of Renewable Energy Promotion (IREP)
Ministry of Energy and Mines (MEM)
5
th
J une, 2013/ BITEC, Bangkok, Thailand
PRESENTATION CONTENT
CURRENT POLICY AND STRATEGY
STATUS OF RENEWABLE ENERGY
DEVELOPMENT
INVESTMENT OPPORTUNITIES AND
CHALLENGES
POLICY
The promotion and development of renewable energies is one of the
priority policies of the Government to stabilize energy supply and to
assist in the social and economic improvement of the country.
Promote sustainable renewable energy development as an important
part of ensuring energy supply for social and economic development
Provide financial incentives to investors who aim to produce clean
energies to meet domestic demand and, who take socially and
environmental corporate responsibility in order to increase investments
in renewable energy projects
Formulate and improve laws and regulations to facilitate renewable
energy development
POLICY
Prioritization of policies which facilitate private sector investments in rural
electrification such as provision of incentives and financing,
Development of small hydropower systems, biofuels, solar and biomass
energy at the village level to provide electricity and energy to rural and
remote communities.
Generation of electricity for productive uses at the village level using
waste materials from agriculture, biogas, hydropower or other local
resources. People in rural areas will be encouraged to use renewable
energy to enhance self-sufficiency and the GoL will seek cooperation with
private sector, NGO and development partners to encourage investment
support for processing equipment and necessary machinery adjustments.
Solar+ Wind 106
MW
Solar 33 MW
Wind 73 MW
SHP
400 MW
Bio-Energy
Biomass-electric Biogas Waste
58 MW 51 MW 36 MW
Biofuels (ML)
Ethanol 150
Biodiesel 300
Financial Incentive
for Investors
Renewable Energy Strategy
Development (2011-2025)
Develop and Modify Legal
documents (laws,
regulations and guidelines)
Target: increaseRE useto30%of national demandby2025(bio-fuel productiontoaccount 10%)
STRATEGICAL TARGET
Objective: Ensureenergysecurity, sustainsocio-economicdevelopment, andenhanceenvironmental and
social sustainability
Biomass
Establish Renewable Energy Fund
Financial Mechanism:
- Import dutyfreeonproductionmachinery, equipment andrawmaterials
- Import dutyfreeonchemical materialsnecessary for biofuelsproductionwithin7years
- Profit tax is dividedinto3categories: 20%, 15%and10%. Profit tax exemptionis possiblefor acertainperioddepending
onactivities, investment areasandsizeinvestment
Subsidiesonunit product pricedependingonenergy typeandtimesperiod
Support
Mechanism
Renewable Energy Development Plan 2010 - 2025
Develop legal documents (laws, regulations and guidelines),
Study development models,
Market assessment and energy source studies,
Rural energy planning,
Develop model projects, capacity building and raising
awareness on renewable energy technology,
Financing and marketing at both national and local levels
(promote the use of approved renewable energy
technologies)
SHORT TERM (2010-2015)
RE DEVELOPMENT PLAN (CONTD.): 2016-2020
Promote the renewable energy technology industry,
Formulate a clear framework for a midterm program
(through focus on increased competition)
Support the full development of renewable energy:
biodiesel and bio-ethanol production from crops,
production of biomass, biogas for household use and
industrial purposes at community level.
Increased competition and reduced dependency
RE DEV. PLAN (CONTD.): 2021-2025
Promote new, economically viable, renewable
energy technologies and encourage full
competition based on equality.
Promote Lao PDR to become a regional bio-
fuel exporter
INVESTMENT OPPORTUNITY
BIOFUEL
Kolao Farm and
Bioenergy Co., Ltd
Kenthao, district
SayaburyProvince
Facility Capacity:
10,000L/d
Feedstock: J atropha
Lao-Agrotech Co., Ltd
Naxaythong, district
Vientiane Capital
Facility Capacity: 10,000-
20,000L/d
Feedstock: Palm oil
Biodiesel-Makao Lao Co., Ltd
Luangprabang, district
LuangprabangProvince
Facility Capacity: 100-10,000 L/d
Feedstock: Vernicia Montana
Production B5
Demonstration B5 from
J atropha;
Demonstration B5 from Palm
Oil;
Demonstration B5 from
VERNICIA MONTANA.
IMPLEMENTATION
I. Biofuel production
2
,
0
0
0
,
0
0
0

5
0
,
0
0
0
,
0
0
0

7
9
,
0
0
0
,
0
0
0

2
,
0
0
0
,
0
0
0

4
1
,
0
0
0
,
0
0
0

7
9
,
0
0
0
,
0
0
0
.
0
0
-
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
80,000,000
90,000,000
2011-2015 2015-2020 2020-2025
Biodiesel (ML)
Target Biodiesel (ML)
Target Bio-ethanol (ML)
2
,
1
0
0
,
0
0
0
2
,
0
0
0
,
0
0
0
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2013
Biodiesel (ML)
Target Biodiesel (ML)
Bio-ethanol (ML)
Target Bio-ethanol
(ML)
Data: 11/2/2013
II. Small Hydropower Development
Potential: 2,000 MW (Less
than 15 MW)
Developed: 30 MW
Under Construction 85 MW
Under study: 500 MW
PICO Hydro: More than
1,000 units (in isolated
areas)
- Low efficiency;
- Not safety; and
- Not appropriate
management
Small Hydro
3
0
8
0
1
3
4
4
0
0
0
50
100
150
200
250
300
350
400
450
2013-2015 2020 2025
Existing (MW)
Target (MW)
III. Solar Energy
III. Solar Development
1.5
22
36
48
0
10
20
30
40
50
60
2013-2015 2020 2025
Existing (MW)
Target (MW)
Biomass for Power Generation
Mit Lao Sugar Mill
Xaibury, district
SavannakhetProvince
Install Capacity: 9.7 MW
Feedstock: Bagasse
Hoang Anh Sugar Mill
Phouvong, district
SavannakhetProvince
Install Capacity: 30 MW
Feedstock: Bagasse
IV. Biomass for Power Generation
39
13
24
58
0
10
20
30
40
50
60
70
2013-2015 2020 2025
Existing (MW)
Target (MW)
V. Biogas
SNV, 2,400 HHs (2011)
2
,
4
0
0
2
,
8
5
0
2
5
,
0
0
0

5
0
,
0
0
0
0
10,000
20,000
30,000
40,000
50,000
60,000
2013-2015 2020 2025
Existing of HH
Target of HH
10
19
51
0
10
20
30
40
50
60
2015 2020 2025
(MW)
Target (MW)
V. Biogas Plant
(Lao Indochina Group (LIG) Public Company)
Million m3
Waste water treatment from
Cassava and produce biogas 7
million m3/y
Production of biogas 90
Million (Nm3) or million
normal cubic meters (Nm3),
approximately at 175 million
liters, of heavyfuel oil (HFO)
reducing as much as 300,000
tones of greenhouse gas per
year and 60,000 tones of CO2
onanannual basis.
7
90
0
10
20
30
40
50
60
70
80
90
100
Production Plant (m3/y) Concession
2013
VI. Wind Development
6
1
2
7
3
0
10
20
30
40
50
60
70
80
2015 2020 2025
Existing (MW)
Target (MW)
INVESTMENT OPPORTUNITIES (3)
Energy crops
Fuel crops plantation for biofuelsproduction has also progressed,
especially J atropha, VerniciaMontana, Palm, Sugarcane, Cassava
plantation.
Organic wastes:
Agriculture-Forestry production, By-products of agro-forestry
industry (sawdust, wood chips, rice husk, corn cobs, livestock
manures...) and municipal wastes
Production of biomass, biogas for household use and
industrial purposes at community level.
INCNETIVES
The Government will provide financial incentives and financing
assistance to renewable energy projects and investors.
Financial Incentives
Import duty free on production machinery, equipment and raw
materials;
Import duty free on chemical materials necessary for biofuels
production within 7 years;
Profit tax is divided in to 3 categories: 20%, 15% and 10%. Profit tax
exemption is possible for a certain period depending on activities,
investment areas and size investment;
Subsidies on unit product price depending on energy type and times
period.
INCENTIVES
The government has policies to support renewable
energy, especially financial measures which include:
Subsidizing tariffs (FIT IS UNDER STUDY)
Project Condition basic, project by project
The government is responsible for basic
infrastructures to accommodate the expansion of
renewable energy such as: transmission line
systems
CHALLENGES
Lack of regulations and laws on renewable energies
Limited knowledge and understanding on various aspects of renewable
energies
Limited number of people with strong knowledge of renewable energy
technologies as well as limited access to equipment and supply of
materials for projects
Lack of public funding for the renewable energy sector. Limited budget
allocated for research and development.
Lack of information concerning off-take tariffs which represent
significant financial risk for investors.
Lack of information on renewable energy potential for each province
MANY THANKS FOR YOUR
KIND ATTENTION