Taking Off

Smart grid market in Southeast Asia

With a growing population and the associated increase in the rate of urbanisation and industrialisation as well as the growing role of renewable energy, Southeast Asian countries are facing grid challenges that can be best addressed through smart grid technologies. To meet the growing demand, it has become necessary to utilise the generated power efficiently by reducing transmission and distribution losses. Further, objectives like reliable power supply, energy security, seamless integration of intermittent renewable power, and an efficient ASEAN (Association of Southeast Asian Nations) power grid, which is under development, have led Southeast Asian countries to invest in smart grid projects that will be scaled up in the coming years.

Among the countries in this region, Singapore has the best infrastructure to support the implementation of smart grid technologies. On the smart grid front, distribution grid management, demand response and advanced metering infrastructure (AMI) are key initiatives. Another emerging area of smart technology implementation is electric vehicle (EV) charging infrastructure, wherein the charging systems can be made bidirectional with the ability to transfer charge from the vehicle to the grid.

Overall, the smart grid market in Southeast Asia is estimated to be $25 million in revenue terms. This would cross $300 million in the next five years, implying a compound annual growth rate (CAGR) of about 50 per cent. Currently, the market is dominated by five key players – the US’s General Electric, Singapore’s ST Electronics Pte Limited, Ireland-based Accenture, Swiss ABB and Malaysian PSI Incontrol. According to global growth consulting firm Frost & Sullivan, together these companies hold 65-70 per cent of the market share. Another 20-25 per cent is held by Malaysia’s Comintel, and US-based companies Mitsubishi Electric Automation, Echelon and Silver Spring Networks.

The following sections summarise the planned and completed smart grid initiatives in key Southeast Asian countries…

Singapore

According to Frost & Sullivan, Singapore’s smart grid market (in revenue terms) stood at $2.9 million in 2012. This market is likely to grow to $163.5 million by 2018, implying a CAGR of 95.8 per cent. The Singapore power grid, which is one of the most reliable networks in the world, has a supervisory control and data acquisition (SCADA)-based intelligent generation and transmission network in place, which facilitates two-way communication and detects power disruptions. The country is now looking at initiatives that will help consumers manage their energy consumption and costs, reduce wastage, and reduce peak loads to optimise system efficiency.

In this regard, an intelligent energy system (IES) pilot was launched by the Energy Market Authority (EMA), a statutory board under the Ministry of Trade and Industry, Singapore, in 2010. The IES pilot, which is being undertaken in two phases, seeks to test and evaluate new applications and technologies around a smart grid. The first phase, which has been completed, involved development of enabling infrastructure in the form of AMI and wireless communication networks. The second phase, which is in progress, involves testing of various applications for 4,500 commercial, industrial and household customers. The pilot programme entails an investment of $30 million and has been funded by the Singapore government and Singapore Power.

The EMA has also embarked on a microgrid test-bed project in the jetty area of Pulau Ubin, an island northeast of Singapore. The test-bed aims to assess the reliability of electricity supply within a microgrid infrastructure using intermittent renewable energy sources. A Singapore-based consortium comprising Daily Life Renewable Energy Pte Limited and OKH Holdings Pte Limited has been appointed to design, build, own and operate the microgrid infrastructure.

Another programme driving smart grid investments in Singapore is the EV test-bed, which was introduced in 2011 by the EMA along with the Land Transport Authority. The test-bed will help understand the optimal way to operate and deploy charging infrastructure; consumer behaviour in terms of charging; robustness of EV battery systems; and general performance of EVs in Singapore road conditions. Currently, there are 89 registered EVs under the test-bed, 58 normal charging stations and three quick charging stations. Robert Bosch (SEA) Pte Limited has been appointed for project implementation.

In July 2013, the EMA announced the award of research grants totalling $10 million to six research teams for projects on smart grid technologies for areas like energy analytics, storage, condition monitoring and control systems under the Energy Innovation Programme Office.

Thailand

As per Frost & Sullivan, the smart grid market in Thailand is expected to grow from $16.7 million in 2012 to $105.3 million in 2018, recording a CAGR of 35.9 per cent. In Thailand, the state-owned Metropolitan Electricity Authority (MEA), which supplies electricity in the Bangkok region, and the Electricity Generating Authority of Thailand (EGAT), which owns and manages the majority of the country’s electricity generation capacity as well as the transmission network, have implemented SCADA. The MEA has also been using an energy management system (EMS) to analyse power flow and contingency on the supply side. Further, the MEA is undertaking substation automation gradually. On the distribution side, a distribution management system (DMS) is also installed. About 8,000 units of automatic meter readers have already been procured for time-of-use (ToU) customers and another 23,000 such meters will be installed by the MEA next year.

With an aim to achieve 100 per cent smart grid penetration by 2026, the Energy Policy and Planning Office (EPPO) under the Ministry of Energy, Thailand, is preparing a plan for smart grid application. State-owned companies like EGAT, the Provincial Electricity Authority (PEA) and the MEA require the EPPO’s endorsement for their investments. Besides, the PEA, which is responsible for generation, procurement and distribution in 74 provinces, has come up with its smart grid road map till 2026 entailing an investment of $3.7 billion. In Phase I (till 2016), planned pilot projects include microgrids, smart meter infrastructure, smart offices, EMS and real-time power trading. These pilots will be undertaken in cities like Phuket and Pattaya. In Phase II (2017-21), these projects will be scaled up to include asset management, mobile workforce management systems, substation automation, automated networks covering major cities, development of renewable energy and energy storage, AMI deployment, and applications for electric transportation, community lighting, and bundled services such as common billing. In Phase III, steps will be taken to establish nationwide automated electricity networks, large renewable energy integration, EVs supporting intelligent two-way power supply, etc.

Further, EGAT has issued its plan for communication improvement. The utility has also set up a smart grid work group which has identified new technologies like digitalised substations, wide area monitoring systems (WAMS), the special protection scheme (SPS) and automatic fault analysis (AFA) for deployment. State-owned PTT Public Company Limited has expressed interest in developing EV charging stations.

Vietnam

In Vietnam, the smart grid market is very small with a few projects at the proposal stage. The Ministry of Industry and Trade (MOIT) has developed the Roadmap of Smart Grid Development in Vietnam, which was approved in October 2012. As per this, smart grid initiatives will be taken in three phases till 2022 and will cover the implementation of SCADA, DMS, AMI and ToU meters; technical standardisation for deployment of smart grids; and evaluation of other smart technologies like information and communication technology infrastructure for the distribution grid, the demand response programme, and geographic information system substations. Smart grid programmes at the initial stages of implementation in Vietnam include installation of ToU meters; and installation of 10,000 electronic meters by 2017, which is being implemented by EVN Central power Cooperation. These also include the deployment of SCADA/ EMS, and EV charging infrastructure in cities including Cua Lo, Sam Son, Haiphong, Hanoi and Ho Chi Minh. Under another programme, 1,100 smart meters have been installed by the Hanoi Power Corporation and the Ho Chi Minh Power Corporation for undertaking load research. The programme is being implemented by the Vietnam Electricity Corporation, the country’s largest power company, and the Electricity Regulatory Authority of Vietnam.

Indonesia

In Indonesia, the government-owned distribution company PT Perusahaan Listrik Negara (PT PLN) has initiated several projects. These include the installation of automatic meter readers for commercial and industrial consumers, which has been under way since 2007. A prepaid meter installation drive has been undertaken since 2009 and so far, about 500,000 such meters have been installed. The country is now embarking on an AMI pilot programme, under which 10,000 smart meters will be installed for identified customers. Further, a smart microgrid pilot project is being implemented in Sumba. Another smart city project is likely to be undertaken for Jakarta city. The government has also approved a scheme for smart grid development.

Malaysia

According to Frost & Sullivan, the Malaysian smart grid market is expected to grow from $2.4 million to $61.8 million. Tenaga Nasional Berhad (TNB), the country’s power utility, has introduced smart grid demonstration projects in three cities – Bayan Lepas representing industrial customers, Bukit Bintang representing commercial customers and Medini representing general customers. The projects aim to reduce the country’s dependence on coal and natural gas and increase renewable energy generation to 4,000 MW by 2020. By 2015, 5,000 smart meters are expected to be installed in the country. These projects are a part of TNB’s 25-Year Electricity Technology Roadmap, which was formulated in 2009. Further, steps will be taken to roll out smart meters, AMI, bidirectional communication, improved billing, remote connection management, dynamic voltage/VAR control, demand management, and consumer power management. In addition, the focus will be on reducing carbon emissions, increasing renewable energy generation, facilitating energy storage, operation of EVs, and energy efficient street lighting.

Meanwhile, Masers Energy Malaysia Sdn Bhd is set to develop its $72 billion first Smart Grid City and Green Special Economic Zone project in Melaka. An MoU has been signed with South Korea’s C&M Global Company for the project. Silver Spring Networks, Inc., a networking platform and solutions provider for smart energy networks, has also entered into an agreement with Masers Energy Malaysia, a fully owned subsidiary of Masers Energy, Inc., to provide smart infrastructure benefits to Malaysia. The first smart grid city, Melaka, will incorporate green and cleaner technologies for efficient energy storage, energy recovery, and EV infrastructure. The project will explore the capacity of smart grids to integrate renewable energy sources into the network. It will involve advanced metering, distribution automation, and smart grid consumer empowerment initiatives.

The Philippines

The National Grid Corporation of the Philippines (NGCP), the country’s transmission system operator, has deployed EMS, SCADA and AMR. Distribution utilities including MERALCO, BENECO, VECO and the Davao Light & Power Company have deployed SCADA and AMR at the pilot level, customer information systems, and automated mapping/facilities management at the pilot stage. The market operator, Philippine Electricity Market Corporation, has deployed a market management system. The government plans to invest in electrical chargers that can charge 100,000 electric tricycles by 2018. Distribution utility Meralco proposes to install 15,000 smart meters by 2015. Meralco and NGCP are deploying smart meters with two-way communication and demand response on a trial basis.  Further, in a bid to modernise the country’s power grid, the Department of Energy has set up a committee that will come up with a smart grid road map, which will propose a long-term strategy till 2030.

Key challenges

While smart grid initiatives are a necessity in today’s world, there are challenges in implementing these projects on a large scale. High investment costs; low electricity tariffs; and the lack of firm official policies on smart grids, communication and compatibility among different utilities, coordination among stakeholders, public awareness, and expertise are often cited as major hurdles to smart grid implementation. As the entire smart grid is based on IT and communication systems, ensuring security is a major concern given the increased risk of cyberattacks. Despite these challenges, smart grid implementation in Southeast Asian countries is expected to take place at a fast pace given the growing power demand and the increasing role of renewable energy.

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