Ministry of Energy and Mines

Introduction of current situation and policy on energy and natural Introduction of Power of Laoin Lao PDR resources Sector PDR
Presented by: Bounsy DETHAVONG Soulivong DARAVONG Deputy Manila, 4th June,2012
Minister of Energy and Mines Lao PDR Director of DEM 2009 Vientiane, 6 May

___________________________________________________ _______

Title of Presentation
1. Introduction of Power sector 2. Power Sector policy 3. Power Sector management

Background of Lao PDR

Area of 236,800 km sq; 16 Provinces + Capital and 139 districts; Population of 5.8 million (2007); GDP of USD 4.1 billion (2007); GDP per Capita of USD 701 (2007); Mountainous area with major tributaries of the Mekong River covering 35% of total Mekong River basin. Relatively high annual rainfall.

Background of Lao PDR (cont)

Hydropower potential: 23,000 MW Existing installed capacity of 672 MW (3%) Produced energy of 3,500 GWh/Y Produced energy per capita of 700 kWh/Y Exported energy per capita of 320 kWh/Y

History of Power Sector Development

Memorandum of Understanding on the power exchange program was signed with the Royal Thai Government in 1993 and 1996 under which 3,000 MW is to be supplied to Thailand and subsequently increased 7,000 MW is agreed; In 1998 and 2006 MOUs were signed with the Government of Vietnam for 3000 MW and subsequently 5000 MW is agreed; In 1999 Agreement on Cooperation in Power Sector was signed with Cambodia; Power Sector Strategy developed and updated from time to time; Power sector opened to private foreign direct investment; Legal framework has been improved from time to time to meet international financing requirements.

2. Power Sector Policy

Maintain and expand affordable, reliable and sustainable electricity supply to promote economic and social development; Promote power exports as well as domestic power supply to earn revenues to meet Government development objectives with particular emphasis on poverty eradication; Develop and enhance the legal and regulatory framework to facilitate power sector development by either public, private or public private partnership; Gain capacity building through international technical knowhow and expertise; Ensure accountability and transparency of environmental and social impacts and thereby achieve sustainable development

Objective of the Power Sector Development

Propovide a source of foreign exchange to fund economic and social development and alleviate poverty; Meet the commitments under intergovernmental MOUs and Agreements with Thailand, Vietnam and others; Extend rural electrification to promote better socioeconomic development and reach the government target of 70% and 90% by year 2010 and 2020 respectively; Integrate power sector and maintain its economic development as a whole with international communities trough its power exchange programs and foreign direct investment.

Renewable energy Policy

Increase a share of bio-fuel consumption in Transport Sector up to 30% by 2020; Establish a National Policy of Renewable Strategic Policy; Establish a National Strategic Plan for Biofuel development.

Development Status
65 Projects with estimated installed capacity of 20,000 MW Projects at Feasibility Study stages/with Memorandum of Understanding (MOU): 35 Projects with estimated installed

capacity of 7.270 MW
Projects at Preparation stage/with Project Development

Agreement (PDA): 27 projects with estimated installed capacity of

7.618 MW Projects under Construction / with Concession Agreement (CA): 10 Projects with installed capacity of 4.360MW

Development Status (cont)

For electric generation and consumption, hydropower type comprises of 99.8% of total, the rest is diesel generation and solar photovoltaic sets. Electrification ratio is estimated at 60% in 2008.

Ownership of Generation
Installed Capacity: 2,534.2 MW: EdL 875 MW 2004 IPP: 1.639.2 MW, Provincial: 20 MW 2.9% 0.789 PROVINCES

IPP

EDL

44.6% 34.52

52.5% 64.68

EDL

IPP

PROVINCES

3.

Power Sector management

Power Sector monitoring, inspection and examination were followed by Legal system for example Electricity Law, Water and Water resources Law, Environmental Law, Land Law, Forestry Law,Lao Electric Power Technical Standards and so on and so fort.

Instructions: LEPTS Procedure of Electric Power Project in Lao P.D.R.

Government Activity (MEM Activity) Agreement between Government & Project Memorandum of Understanding (MOU) Project Activity
( planning stage )

Feasibility Study (FS)

Interim Letter of Approval to FS
(if any or as necessary)

Project Development Agreement (PDA) Feasibility Study (FS) Design Criteria with Basic Design
(Form2 and Drawings)

( detail design stage )

Tender Documents
(Detailed Technical Specifications)

Final Letter of Approval to FS Concession Agreement (CA)

( construction stage )

Construction

Completion Certificate
Commencement of Operation