Energy Efficiency is Our Future

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Growth in the ASEAN region has naturally resulted in an increase in energy consumption. Assuming a GDP growth rate of 5.2% per year from 2007 to 2030, energy consumption is expected to increase to 427 Mtoe ("million tons of oil equivalent", or the equivalent of several million tons of oil) in 2010 to 1018 Mtoe in 2030 (ACE and IEEJ; the 3rd ASEAN Energy Outlook: BAU Scenario). However, in 2011, 160 million people in Southeast Asia still live without access to electricity. Nearly 80% of those living in remote and rural areas (The Energy Collective, 2011).

Electric deployment carries potential and a great challenge for the ASEAN region, which consists of 10 countries and largely consists of the islands. Indonesia consists of 18,000 islands by electrification rate of 73%, while Vietnam 76%. Thailand has a better rate by 99%, but the rate of electrification in Myanmar is only 49% (IEA, World Energy Outlook, 2013).

There are two models of power plants that might address this challenge; a draft national electricity generation, which is supported by the transmission network across the country, or distributed energy model, in which the power generation and power users are in the same area.



National power generation transmission and distribution networks require extensive, costly and often takes years just to build the infrastructure. Since many countries in the ASEAN region is still classified as a developing country economies and the "new" in terms of democracy, develop appropriate electrical infrastructure to meet the supply and demand is very challenging.

Energy efficiency in power generation is also greatly affected by the selection of fuel and efficiency of the power plant itself. This includes, but is not limited to, operational efficiency and equipment. One of the most important factors that affect the cost and performance in generating electricity is technology.

Currently, in the ASEAN region, the majority of power plants using steam or gas turbine. The most efficient gas turbines available in the world today is the turbine 9HA, which has an index of efficiency of 61% (Gas Turbine World publication, January 2014). In addition, the gas turbine requires carbon cycle costs and produce the lowest emissions. There is no system that offers higher capacity. This is the kind of economy that would make proud Disraeli.

In addition to the types of power plants, the selection of fuel will also contribute to the difference in electricity tariffs for consumers, households, and commercial purposes. Seeing that many governments of ASEAN countries, such as Malaysia, have begun to reduce dependence on fuel subsidies, the efficiency of the selection of technology and fuels become an increasingly important consideration.

Flexible power source and reliable

ASEAN countries such as Thailand, Indonesia, and Malaysia never able to drape a large amount of their revenues from gas exports, which helped offset the subsidy. Along with the decrease in the amount of revenue reserves of the sector, the fuel subsidy will be further down. The government was then trapped in a scenario, the continued fossil fuel subsidies, or remove subsidies gradually, which would certainly troublesome community, the end consumer.

Because of this, comes the awareness of increasingly limited stock of fuel gas in the country, which led to a debate about alternative energy options are available, such as coal and renewable energy. However, it will certainly take several years to equalize the capacity of coal and gas power plants. Therefore, the end consumer will be better off (pull for their electricity would be cheaper) if the issue of costs for the end user-driven Fuel Cost Pass Through (FCPT) dealt with implementing solutions and the most efficient and competitive technologies are available in market.

Although the regulators lately tend to prefer large-scale coal power plants, the environmental impact of coal combustion justify arguments against excessive reliance on this process. Based on the analysis of BCG, 50% of the electricity needs of Southeast Asia will now be met by coal, compared to 30% in 2010. Currently, 29.7% of coal supply energy use worldwide and is responsible for 44% of global CO2 emissions-a big question mark for success.

The challenge of the ever increasing demand for LNG and supply logistics problem remains a critical case. Japan, the largest LNG importer, seeks to reduce the sharp increase in the price of LNG by using the most efficient technology to generate electricity.

Because the cost of gas can reach 70% of operating expenses, it is important for developers to adopt the technology the most efficient power plants, including the turbine which has the best-in-class efficiency and provide opportunities for them to remain competitive. One example is the gas turbine 9HA which has been declared as the most efficient in the world, waste reduction of CO2, and, most importantly, a reduction in operating and maintenance costs for the long term. All of this, coupled with strategic combo power generation, will ensure affordable electricity costs for the end consumer.

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