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Energy Sector Capacity Building Activity

Energy Sector Capacity Building Activity. 12 February 2015. Contents. Jordan’s Energy Crisis Jordan’s Energy Policy Response ESCB’s Vision and Objectives Task-by-task Descriptions Transformative Effect of ESCB’s Activities Upcoming Milestones.

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Energy Sector Capacity Building Activity

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  1. Energy Sector Capacity Building Activity 12 February 2015

  2. Contents • Jordan’s Energy Crisis • Jordan’s Energy Policy Response • ESCB’s Vision and Objectives • Task-by-task Descriptions • Transformative Effect of ESCB’s Activities • Upcoming Milestones

  3. Jordan’s energy sector faces multiple challenges Rapidly growing energy demand • 7% annualgrowth in primary energy demand • 5.5% annual growth in electricity demand Near total dependency on imported fuels • 97% of energy needs met through imports • 17% of GDP annual spending on energy imports Large subsidy flows for household electricity consumption • $1.3 billion spent last year on electricity subsidies Mobilizing the investment to expand energy resources • New supplies (conventional and renewable) • Transmission additions

  4. Jordan’s energy policy promotes diversifying energy production while reducing consumer demand and subsidies Jordan’s 2007-2020 Energy Strategy calls for increasing the share of renewable energy to 10% by installing an additional 1,000 MW of wind and 800 MW of solar energy by 2020. Renewable Energy The 2012 National Energy Action Plan calls for a 30% increase in solar water heater uptake and 20% improvement in energy efficiency by 2020. Energy Efficiency Supply diversity MEMR and NEPCO are pursuing alternative supplies for power generation, including Eastern Mediterranean gas, as well as shale gas and nuclear. All figures from GOJ documents

  5. ESCB has an ambitious mission to transform Jordan’s energy sector VISION Jordan achieves energy security through effective sector planning and management that is based on strong analytical capabilities, effective implementation tools, and a vibrant private sector. MISSION Provide the technical assistance and capacity building needed to introduce diversified energy supplies and to better manage energy demand.

  6. ESCB takes a comprehensive approach to strengthening policies and institutions in the energy sector Build the institutional capacity to plan and oversee rational development of the energy sector Support the private sector to increase the supply of clean energy Promote a culture of sustainable energy consumption in households, businesses and government Advocate and facilitate cooperation between energy sector stakeholders Expand employment and leadership opportunities in the energy sector for women, youth and people with disabilities

  7. Task 1: Enable demand side management (DSM)

  8. Demand-Side Management encompasses electricity-saving measures delivered by electric utilities These measures can include: • Energy saving behavior by consumers • Energy-efficient appliances and equipment • Solar PV • Solar Water Heating Who benefits from DSM? • Electricity consumers • NEPCO and the Government of Jordan • Local communities and businesses

  9. DSM has proven effective in the U.S. and globally COST RECOVERY • DSM is a fast-growing industry that accounts for about 20% of total energy-savings in the US • Energy saving investments are funded through utility bills • Utilities receive an incentive for meeting their targets • A regulatory and legal framework is required for DSM to be successful • Mature DSM programs have been shown to deliver 3-5% annual savings on a long-term basis REVENUE RECOVERY PERFORMANCE INCENTIVES

  10. DSM for households addresses Jordan’s energy challenges and opportunities Household Energy challenges • 40% of total electricity • Fastest-growing sector • 75,000 new households annually • 7% annual growth • Main subsidy recipient • 400 million JD (2015)

  11. Electricity distributors are well positioned to deliver household energy programs in Jordan • Strong technical and administrative capacity • Billing data needed to segment markets and qualify customers • Access to financing • Familiarity and branding • Complete geographic coverage • Well-placed to overcome the low-awareness and risk-aversion of households regarding energy efficiency and renewable energy

  12. ESCB’s activities address the full spectrum of support required to advance DSM in Jordan Tools to design and evaluate DSM programs Establishing a regulatory and legal framework • DSM financial analysis model developed • In use by electric utilities and the regulator • DSM Recommendations adopted • DSM Guidance issued by EMRC Task 1 DSM capacity building Identifying energy-saving opportunities • DSM units at each distribution company • Establishing DSM oversight capacity for the regulator • Household load surveys completed and results in use • Billing data analysis DSM Funding • Jordan Renewable Energy and Energy Efficiency Fund (JREEEF) operational • Tariff revenues

  13. Task 2: Build the Capacity of the Energy Sector

  14. ESCB works with multiple counterparts in Jordan’s electricity sector Ministry of Energy and Mineral Resources Energy and Mineral Resources Commission Various energy suppliers (domestic and foreign) NEPCO EDCO JEPCO IDECO

  15. ESCB delivers a broad range of technical assistance and capacity building throughout the energy sector Establishing and Operating Revolving Funds Intermittent Renewable Resources Grid Codes • MEMR/JREEEF • NEPCO • Distribution Companies • EMRC Task 2 Assessing of Efficient Lighting Testing Lab Requirements Energy Saving Action Planning • JSMO • MEMR • Other Ministries Energy Audit Training • MEMR • Other Ministries

  16. Task 3: Establish a private sector led clean energy industry

  17. Establishing a thriving energy services industry in Jordan Build professional credentials of ESPs Improve access to finance • Assessment of resources • Market-reflective financial products • Performance risk guarantees • Standardized performance contracts • Coordinating with other USAID and donor projects • Needs assessment of companies • One-on-one support to ESPs • CEM and CMVP training Task 3 Create capacity for ESP self-regulation Establish an ESP association • Develop private sector led voluntary accreditation system • Support government to license energy auditors • Coalition of energy associations • Strengthening individual energy associations

  18. Task 4: Respond to emerging needs

  19. ESCB flexible response mechanism to meet demand-driven needs Waste-to-Energy tender for Greater Amman Municipality Solar PV demonstrations on government buildings Task 4 Support Eastern Mediterranean Gas Supply Negotiations

  20. Focus: Including Women, Youth and People with Disabilities

  21. ESCB’s Gender Goals Ensure that women play a key role in planning, developing and implementing EE/RE Actively promote and provide capacity building for women's participation and leadership in our counterpart organizations, public and private Support the development of women-owned energy companies

  22. Key Activities • Launched ESCB’s mentorship program for young women in the sector • Work with universities to encourage young women to pursue careers in energy (internship program and inclusion in ESCB activities) • Women-focused leadership activities • Continue to foster dialogue on participation and promote inclusive policies • Target capacity-building to women-owned businesses

  23. Achieving ESCB’s vision for energy sector transformation

  24. What does energy sector transformation look like? Reduce energy demand growth and subsidy outlays through energy-saving policies and programs Develop a legal/regulatory frameworks that supports clean energy and private investment Facilitate consumer and business access to energy efficiency knowledge, practices and technology Consumer demand Government spending Energy expenditures Electricity prices Private investment in clean energy Renewable energy production Government spending New business and jobs Consumer demand Energy expenditures New technologies

  25. Upcoming Project Milestones April Jordan Customs Solar PV Commissioning April-May March JREEEF Year 1 Programs Launch 19-20 May MoPIC Solar PV Commissioning Women’s Leadership Forum April DSM Program Launch

  26. Thank you!Mary Worzala, Chief of Partymworzala@deloitte.comGrayson Heffner, Resident Advisorgheffner@deloitte.com

  27. APPENDIX

  28. Household Load Surveys help identify DSM market opportunities

  29. DSM Financial Analysis Model

  30. Support to renewable power integration • Jordan’s renewable energy goals call for over 1800 MW of new power generation by 2020 • Renewable power sources must be interconnected in a standardized way to avoid impacts on grid reliability • A grid code standardizes interconnection requirements previously done on a project-by-project basis • ESCB supported NEPCO, EMRC, DISCOs and project developers to develop Renewable Resource Grid Codes

  31. Operationalizing JREEEF • Developed fund strategy and business plan • At MEMR request, coordinating the efforts of donors committed to supporting JREEEF • Organized a consultation process for JREEEF’s stakeholders • Developed the JREEEF by-law, now approved by the Council of Ministers • Designed JREEEF’s EE/RE programs for 2015 implementation, including support to DSM • Providing ongoing analytical and design support to JREEEF

  32. Accreditation is a key ingredient of energy service providers self-regulation

  33. Solar PV demonstrations • Jordan Customs and the MoPIC buildings • 150 kW grid-connected installations • Prominently displayed “dashboards” will explain the benefits of solar PV – increasing awareness and visibility of renewable power production • Standardized bid documents and procedures

  34. RecyclablesRefuse Derived Fuel (RDF)CompostBiogasElectricity/ SteamLiquid Fuels  Size: 700-1,000 TPD initial plant 2,500 TPD final after expansion Technologies: Mixed Waste Processing Facility Anaerobic Digestion/ Composting Gasification/ Pyrolysis/ Mass-Burn Waste-to-Energy Tender for Amman Municipality GAM MSW Tadweer Recycling Plant (legacy agreement) 1,000TPD Residue 1,200-1,500 TPD (with upward flexibility) Tipping Fee (JOD/tonne) MSW Contractor Bids: WTE Infrastructure Potential WTE Products Off-takers Recyclables marketsCement CompaniesAgricultureElectricity Grid Al Ghabawi Landfill Tipping Fee JOD/tonne Zarqa, Al Rsifieh, Industrial waste

  35. Eastern Mediterranean gas supply • Support MEMR/NEPCO on negotiations with gas suppliers • Advise MEMR/NEPCO on the parameters influencing the economics of purchasing gas • Assist MEMR/NEPCO in negotiation agreements • Develop tendering strategies • Analyze key transaction issues and considerations • Build capacity for transaction execution

  36. Institutional Arrangements for distributor-delivered household DSM programs

  37. TFC by consuming sector - Jordan

  38. Growth in retail tariffs 2012-2017

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