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Demand Side Management Program

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.( وَكُلُوا وأشزبوا وال تسزفوا إنه ال يحب المسزفينَ‏ )األعزاف/‏‎31‎<strong>Demand</strong> <strong>Side</strong> <strong>Management</strong> <strong>Program</strong>


Significant Challenges• Rapid peak demand growth• Capital-intensive grid expansion• Low resource utilization• Mandatory load curtailment / blackouts in the summer• Lost revenue when oil is sold to electric utilities at asubstantial loss3


Reasons for the Rapid Growth of Electric Loads• Population and economic growth• Very hot climate• Low electricity rates• Low consumer awareness of energy efficiency• Ineffective enforcement of efficiency standards4


How to Face This Challengeمقدمة<strong>Demand</strong> sideSupply <strong>Side</strong>5


LoadLoad Shape <strong>Management</strong>LoadLoadمقدمةتقليل الحمل الذرويتقليل منحنى األحمالEnergy Efficiency <strong>Program</strong>sLoad management <strong>Program</strong>sHour of DayConservationHour of DayLoad ShiftingHour of DayPeak Clipping6


DSM <strong>Program</strong>sمقدمةLM & DRKSAAbuDhabiOman Bahrain Qatar KuwaitTOU rates √ √Interruptible tariffLoad curtailment √ Not Yet √Direct Load control √ √ Implemented √Thermal Storage√Renewable Sources√Energy EfficiencyBuilding Insulation / Regulation √ √√ √Efficiency Standards √ √ √Efficiency Labelling√Not YetImplementedDistrict cooling √ √Conservations Awareness √ √ √7


Saudi Experience


Study MethodologyAnalyze theConsumptionSurvey ofInternational <strong>Program</strong>sAssessment ofexisting DSMActiveparticipationof relevantstakeholdersEconomic Screeningand Market PotentialDetermineappropriate programsDevelopment ofimplementation plans10


ConsumptionOthers4%Industrial18%Government14%Commercial12%Residential52%11


Energy Consumption by End-UseAppliances1627914% GWhLighting6133 GWh5%WaterHeating4316GWh4%Electronics3384GWh3%Miscellaneous2833 GWh2%Cooling85578 GWh72%RefrigerationWater2,625 GWhHeating10%263 GWh1%Lighting6,825 GWh26%Miscellaneous1,575 GWh6%HVAC14,963 GWh57%ResidentialCommercialMiscellaneous1,508 GWhCompressed Air 3%10,052 GWh20%HVAC2,513 GWh5%Lighting754 GWh2%Miscellaneous5,19817%Refrigeration4,72615%HVAC15,75250%IndustrialElectric motors35,182 GWh70%WaterHeating3151%Lighting5,51317%Government12


Load (MW)Load Duration CurveA 5% reductionwould reduce thepeak by 2 GW38.1 GW36.2 GW2009 SEC Load Duration Curve (Top 500 Hours)39,00038,00037,00036,00035,00034,00033,00032,00031,00030,0000 47 100 200 300 400 50047 hours would need to beHour (sorted high to low)impacted by LM/DR toPeak hours :achieve the 5% reduction12:00 – 4:00 pmon 22 days13


Number of Critical DaysAnalyzing Peak Load CurveNumber of Critical Hours A ten percent system peak reduction would have been feasible in 2009 using LM & EENumber of Critical Days and Hours Neededto Meet Peak Reduction Targets9045080Critical DaysCritical Hours4007035060504030201000% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%Target Reduction in Peak <strong>Demand</strong>300250200150100500Achievable with LM/DR aloneRequires DR, EE, and PLS14


Economic Screening & Market Potential15


Benefit-Cost RatioThe LM/DR Economic Screening CurveLM/DR Economic Screening CurveCLM - IndInterruptible - IndDLC - GovtDLC - CommDyn. Pricing - IndDLC - ResInterruptible - GovtInterruptible - CommDSS - IndAdv. DLC - IndIHD - ResSocial Norm - ResDyn. Pricing - ResAdv. DLC - ResWeb - ResDSS - ResCLM - ResTOU - ResDyn. Pricing - GovtDyn. Pricing - CommAdv. DLC - GovtDSS - GovtCLM - GovtDSS - CommCLM - CommAdv. DLC - CommTOU - GovtTOU - CommTES - CommTES - Govt5.04.54.03.53.02.52.01.51.00.50.0Above lineindicates costeffectivemeasure16


Potential Size of Resource (MW)Interruptible - IndPotential Size of LM/DR MeasuresPotential Size of Individual LM/DR Measures (2012)CLM - IndDyn. Pricing - ResTES - GovtDyn. Pricing - IndTES - CommSocial Norm - ResDSS - ResCLM - ResTOU - ResDSS - IndDLC - CommIHD - ResDLC - GovtDyn. Pricing - GovtDyn. Pricing - CommAdv. DLC - IndDSS - GovtCLM - GovtDLC - ResTOU - GovtInterruptible - GovtDSS - CommCLM - CommTOU - CommInterruptible - CommAdv. DLC - ResWeb - ResAdv. DLC - GovtAdv. DLC - Comm1,2001,000800Blue indicatescost-effectivemeasure600400200017


Technical potential (MW)Potential Measure Impact vs. Benefit-Cost Ratio(<strong>Demand</strong> Response Measures)Potential Measure Impact and Benefit-Cost Ratio1,2001,000800600TES measureshave significantpotential but arenot currently costeffectiveCost-effective measureswith moderate potentialinclude most residentialinformation and pricingmeasuresLowest-risk measures includeinterruptible tariffs and DLCfor all segments as well ascurtailable load managementand pricing with enablingtechnology for industrialcustomers400200Lower-potential measures include pricing withtech for commercial and government, plusenabing tech and web portals for residential00.0 1.0 2.0 3.0 4.0 Greater 5.0than 4.0 6.0Benefit-cost ratio18


Recommended <strong>Program</strong>s EE <strong>Program</strong>s‣ Efficient cooling (retrofit in existing homes and buildings)‣ New construction efficiency (building insulation and a/c) LM/DR <strong>Program</strong>s‣ Direct load control‣ Interruptible tariffs‣ Curtailable load management19


Peak <strong>Demand</strong> (GW)Feasible Reduction in <strong>Demand</strong>807060504030Historical14%202005 2007 2009 2011 2013 2015 2017 2019 2021Year20


Electricity Consumption (GWh)Feasible Reduction in Consumption400,000350,000300,000250,000Historical200,0008%150,000100,0002005 2007 2009 2011 2013 2015 2017 2019 2021Year21


10-year Present Value (Billions of SR)Cost & BenefitsCosts and Benefits of Recommended DSM <strong>Program</strong>s9080706050403020100Net Benefit =SR 50 billion(incl. oil revenue)Net Benefit =SR 3 billion(avoided costs only)LM/DREnergy EfficiencyTotal Cost ofShort-Term DSM PlansAdditional OilRevenue from Salesat World Market PriceAvoided T&D CostAvoided Gen Capacity CostAvoided Energy CostGross Financial Benefit ofShort-Term DSM Plans22


Implementation & Monitoring Target customers categories could be: Residential Commercial Industrial GovernmentImplementation & Monitoring of the DSM <strong>Program</strong> could be through:Distribution Companies Regulator or government Aggregator23


Barriers to DSM Implementation‣ There are several barriers to DSM implementationBarrier1. Subsidized tariff / Low electricity prices KSA, Qatar, BHR, Oman2. Lack of new cost-effective technologies KSA, Qatar, Abu Dhabi3. Low compliance with new standards KSA4. Financial disincentives for utility to implement DSM KSA, Abu Dhabi5. Lack of in-country operational expertise/experience KSA6. Lack of primary market data KSA, Oman, Abu Dhabi7. Difficulty measuring and verifying impacts KSA, Abu Dhabi8. Low customer energy awareness KSA, Qatar, BHR, Oman9. Fear of customer backlash (e.g. “winners and losers”) KSA10. Lack of national framework/policy Oman


Successful FactorsFactor1. Goal setting KSA2. Select the suitable solutions to the different loadobjectivesKSA, Abu Dhabi3. Funding KSA, BHR4. <strong>Program</strong> execution KSA5. Specify the roles & responsibility KSA, BHR, Oman6. Measurements & verifications KSA, Abu Dhabi7. Financial incentives Oman, Qatar8. Consumer participation Qatar, Oman9. Run pilots assess the potential prior to rollout Abu Dhabi25


Critical Decisions are Needed…– DSM Leader?– Organization Structure?– Funding?Approve the DSM Plan– Targets?– Detailed <strong>Program</strong> Plans?


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