Jan 15, 2015

Wrapping my head around this "buying electricity from Laos" thing

I did not see any indications of the potential size of electricity orders in future, but to put things in perspective, Singapore’s total licensed electricity generation capacity was 12,521 MW in 2014, while Laos’ hydropower plants have a capacity of about 3230 MW with the potential to increase to 28,000 MW.

In 2013, total electricity generation in Singapore was 4124 ktoe (48 TWh), while Singapore’s total electricity consumption was 45 TWh in 2013. Electricity tariff from Jan-Mar2015 is 23.29 cents/kWh.
I know some of the numbers are outdated but I think they shouldn’t be too far from +/- 2% in Singapore’s context.

I have a really weak understanding of all these energy stuff, not to mention power transformers or transmission. If anyone has a sense of all these, please share them with me!

What I am trying to wrap my head around is really this; are we really going to source for electricity from Laos? It is unlike commodities where you can just ship them over. I am really sceptical about how the power lines are going to be taken care of.

Also, using the 2013 figures, it does not seem like Singapore might face a power shortage. Laos is also charging a fair price so there should not be an argument for cost. My guess is Singapore will purchase only a small/bite-sized amount of electricity just for an "ASEAN display" to kick the ball rolling for the ASEAN power grid.

Here are the news articles:

Four Asean nations - Laos, Malaysia, Singapore and Thailand - held talks yesterday in Vientiane to consider a plan that would see Laos export electricity to Singapore via transmission lines in Malaysia and Thailand

Malaysia has pledged to take responsibility for technical affairs relating to the envisioned project.
Laos' electricity transmission line is connected with Thailand's, while the Thai network is connected with Malaysia's and the Malaysian transmission line is connected to Singapore.
Deputy Minister of Energy and Mines Mr Viraphonh Viravong said previously that Singapore agreed in principle to purchase 100MW of electricity from Laos as a pilot scheme, while Thailand and Malaysia offered their support for the envisioned project.
Laos sells electricity at a unit price of just over 7 US cents per kwh to Thailand and just over 6 US cents per kwh to Vietnam and Cambodia, while the unit price in Singapore is about 20 US cents per kwh, according to Mr Viraphonh.
In recent years, electricity has been the main revenue generator for Laos. Total income generated from electricity sales in fiscal year 2013-14 hit more than US$880.9 million (more than 7.100 trillion kip), a remarkable increase compared to the year before, according to a recent report.
Of the total, income generated from electricity exports amounting to more than 11,332 million kwh reached US$535.47 million (more than 4.316 trillion kip), an increase of 6.62 percent compared to the year before.
As of October last year, Laos had 25 operational hydropower plants with a total installed capacity of about 3,230MW, exceeding domestic consumption needs of about 1,000MW.
Laos has strong potential to build hydroelectric plants with a combined installed capacity of about 28,000MW, including the existing dams.

Nation, 25 Sep 2014

Building a transmission line to carry electricity from Lao hydropower plants to Singapore can save as much as US$26 billion over 10 years for the four countries involved, according to a new study.

Laos envisaged itself as "Battery of Asia", with plans to generate hydropower for sale to Asean countries aside from Thailand.

Through the transmission grid that will link the four countries, ERIA estimates that the four countries could save between US$23 billion and US$26 billion over 10 years of operation.

Dr Li said they had studied ten years of power trading among the four countries, especially Lao and Singapore.

"But Thailand and Malaysia would also benefit from this because the power goes through their territories and they can carry out some sort of relay power trade in between," he said.

Dr Li said, "Based on the current level of power demand in all four countries, we also projected the future power demand growth over the next ten years and this level of demand is already enough to justify power interconnection between Laos and Singapore."

He said Laos, Thailand, Malaysia and Singapore had determined that the transmission line was technically feasible but had yet to work out a business model for the cross-border trade. He estimated that construction could begin in one or two years’ time.


  1. Hello Clueless Punter,

    You may want to research the publicly listed utilities companies in Australia, US, Canada, etc. There you will see it's not uncommon to transmit electricity across distances greater than from Laos to Singapore.

    But these are within the SAME country.

    For transmission across countries, we may have to look at the natural gas pipeline from Russia across Ukraine and to rest of Western Europe, namely Germany.

    It's not the same as electricity, but we can get a sense of the business model plus technical and regulatory difficulties involved ;)

    Have fun researching!

    Into infrastructure play?

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