Annual Workplan 2011 UAE Electricity

8/14/2019 Annual Workplan 2011 UAE Electricity

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ANNUAL WORK PLAN

AND FIVE -YEAR SECTOR

TIMELINE 2011-2015


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Our Annual Work Plan for 2011 sets out our main objectives for the year and seeks to illustrate ourunique role in the water, wastewater and electricity Sector. As with previous years, we have included

a strategic element in our forward work plans which, in a number of cases, help support the Sectors

long term vision and more immediate ve-year timeline objectives.

Part 1 Strategy in mind Page 1

In this section, we list strategic projects sponsored directly by the Bureau which may have an impact on

the Sector in the future. In most cases, these will require the co-operation of various licence holders.

Costs, where incurred, will be allocated to the Sector, rather than individual licence holders.

Part 2 Five-year timelines Page 5

The electricity, water and wastewater timelines show how the Sector intends to meet demand

requirements in these areas over the next ve years.

Part 3 Key work streams Page 9

These form the bulk of our work for 2011 and are more concerned with operational/regulatorymatters than strategic ones.

Our work is driven by the needs of the Sector and Sector Customers who expect a reliable and

value-for-money service at all times, so what we do matters. As a result, our work, both in the

Sector and the greater community, takes on an increasingly important role in ensuring we provide

suitable regulations and guidance for the future.

Welcome to our 2011 Work Plan.

Nick CarterDirector General

Statement of intent


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PART 1 Strategy in mind

1ANNUAL WORK PLAN 2011


4/20ANNUAL WORK PLAN 20112

Strategy in mind

Water usage

Although consumption of water in the UAE is high, less than 20 percent of the total water delivered

to the transmission system is Returned to Sewer (RTS). This means that over 80 percent ends up

on the ground, mainly through irrigation. Our goal is to encourage a more efcient usage of water

and increase the amount recaptured after use.

Smart grids

Smart Grid relates to the concept of building more intelligence into our power networks to enable

the Sector to benet from the introduction of a range of embedded generation technologies,

monitoring, control and power storage. The purpose of smart grids is to manage more efciently

the generating capacity, particularly at peak demand time.

It is a complex system that works well when fully integrated and we intend to work with all licence

holders concerned to produce a range of operating and connection standards to be known as

Smart Grid Operating Codes and Standards.

A consultation document will be produced this year.

Demand Side Management (DSM)

DSM comprises a range of measures that aim to

modify or reduce customers energy demand.

DSM, smart grids and variable generation all

have an impact on grid stability and generation

expansion.

Given the importance of reducing peak-load

quickly, the Bureau will seek to identify suitable

DSM options and fast-track pilot studies to verify

their effectiveness. This may include direct or

indirect control of loads, such as air conditioning,

with the objective of moving the demand away

from the peak period. We will work closely with

other government entities and sector licence

holders to implement such DSM measures.

We are aiming at a reduction of 250 MW insystem peak by the end of 2012, approximately

3.5 percent of the 2010 peak demand.

GCC Grid

2011 will see the next phase of this

existing project that will link the Gulf

Cooperation Council (GCC) national

power grids with the UAE. Our role

entails facilitating the transmission

system interconnections with the other

transmission network operators. We

will review the Interconnection Codes

and the Power Exchange and Trading

Agreements to ensure compliance with

Abu Dhabi electricity sector legislation.

Additionally, we must ensure that the

expected benets of the interconnection

are achieved in terms of emergency

support, saving of generation installed

capacity and the development of a

regional electricity market, based oneconomic power transfer.


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Strategy in mind

Variable generation

As the Emirate adopts new generation strategies and seeks to diversify away from traditional only

generation, the need to integrate intermittent generation such as solar or wind power is important.

Intermittent resources are fundamentally different to fossil-fuel resources in that their primary fuel

(solar, wind, etc) is not storable (gas or oil are).

Therefore, TRANSCO and the distribution companies will be required to adopt a different approach

to the control and operation of large-scale intermittent generation over the coming years.

Our role in this area is to ensure that suitable probabilistic models and control systems are

established by TRANSCO, AADC and ADDC, and that grid distribution access codes are modied

to reect this new reality.


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PART 2 Five-year timelines



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Power

Sources: ADWEC 2010 Statement of Future Capacity Requirements 2010-2030 (draft)

TRANSCOs 2010 draft Seven-year Planning Statement (2011-2017)

2011

5,000 MW

10,000 MW

12,500 MW

7,500 MW

15,000 MW

17,500 MW

20,000 MW

2012

1,511 MW

400 MW 150 MW

1,950 MW

100 MW

100 MW

100 MW

Distributionworks

ADNOC at Bab F3, HPADS2, Qidfa and

Sweihan

To Saudi Arabia

ADNOC atRuwais

ICAD 400kV ICAD 220KV

Second circuit

380 MW

200 MW

500 MW 900 MW

2013 2014 2015

Generation

Conventional

- Completion of S2 at Shuweihat

- Fujairah F1 extension (2 Qidfa GTs)

- Al Zawra - relocation of 4 gas turbinesto Al Gharbia

- Construction of S3 at Shuweihat

- Evaluation and construction of anew power station

Other energy sources

- Shams 1- concentrated solar power

- Photovoltaic (PV)

- Hydrogen Plant Abu Dhabi (HPAD)

- Energy from waste (evaluation)

Available generation capacity (MW*)

Transmission and distribution

- Completion of three 400kV grid sub- stations for Mahawi, Shamkha and Bahia

- 400 kV connections to EMAL aluminiumsmelter at Taweelah

- Construction of GCC grid connections

- Provision of major electricity connections

- Provision and commissioning oftransmission grid to ICAD

All fgures approximate* MW = megawatt

6 ANNUAL WORK PLAN 2011


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Wastewater

78 MLD16.5 MLD

95 MLD

Source: ADSSCs AIS and Five-year Planning Statement 2009 and 2010

500

1,000

1,500

2011

40 MLD

300 MLD

-150 MLD -240 MLD

300 MLD

30 MLD -15 MLD

80 MLD

57 MLD

-99 MLD

2012 2013 2014 2015

130 MLD

-10 MLD -5 MLD


Abu Dhabi Region

- Operation at ICAD plant

- Etihad Biwater - phase 1 at Al Wathba(nal commissioning and commenceoperation)

- Veolia Besix - phase 2 at Al Wathba(under construction)

- Proposed decommissioning of Mafraq

- Membrane bio-reactors treatment plants

Al Ain Region

- Etihad Biwater - Phase 1 at Al Saad (nalcommissioning and commence operation)

- Veolia Besix treatment plant at BidaHamama (under construction)

- Decommissioning of old Zakher plant

- Decommissioning of temporary packageplants

Island developments

- Reem (new plants and long termevaluation of ow diversion to STEP)

- Saadiyat (2 new plants and evaluation ofow diversion to STEP)

- Yas (new plant and long term evaluationof ow diversion to STEP)

Strategic Tunnel EnhancementProgramme (STEP)

Wastewater treatment capacity (MLD*)

All fgures approximate

*MLD = megalitre per day


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PART 3 Key work streams



12/2010 ANNUAL WORK PLAN 2011

Protecting customers interests

Gated communities

The Bureau will carry out an in-depth study on the way owners and operators of private networks

provide utilities and operate within private residential compounds, tower buildings and commercial

units, commonly known as gated communities. The objectives are to ensure a safe and economic

provision of services to customers and to provide, if needed, regulatory guidance for developers

and property owners.

Strengthen guaranteed customer service standards

An independent audit of the two distribution companies compliance with the guaranteed customer

service standards showed that improvements must be made for individual standards to be met.

Furthermore, end-to-end integration is insufcient and reporting of performance is incomplete and

unreliable.

We will work with both distribution companies to review and possibly revise the Code of Practice

on Guaranteed and Overall Service Standards as well as the internal processes required to meet

these standards. A guide for all stakeholders will also be produced.

Additionally, we will work with the distribution companies so that they improve data collection and

reliability of reporting on performance against the standards.

Water quality inspections

The Water Supply Regulations we issued in 2009

address the safety of potable water supplies in

storage facilities, tanks and road tanker vehicles.

This year, we will put in place an inspection and

sampling scheme in a number of both small andlarge installations to monitor the effectiveness

of the Regulations. The ndings will help us

determine whether a mechanism to improve

compliance needs to be implemented.

Methodology for thecharging of connections

As part of the overall focus on connections,

this year we will work with the distribution

companies to ensure that a connection

charging methodology, issued by the

Bureau in 2010, is implemented. This is alicence requirement and it will set out the

basis upon which charges for connection

to their distribution systems are made.

The aim is to improve transparency

and enable persons applying for a new

connection to estimate the charges they

can expect to pay.


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Improving performance

Implementation of plant audit regime

Effective plant maintenance is key to achieving power plant reliability and overall system resilience.

This year, we will continue to examine the maintenance regimes and associated planned maintenance

procedures of power plants to test the robustness and effectiveness of these in preventing plant

breakdowns. We will also explore potential improvements and best practice that could maximise

reliability and availability across the sector.

Load forecasting

Strategic system planning is crucial to ensure that efcient networks are developed to meet the

needs of Abu Dhabi over the next few decades and beyond. For the moment the sector lacks

a source of real historic data on actual demand for all categories of premises in Abu Dhabi. By

working with the distribution companies, we will carry out load studies utilising data extracted

from the new automated meter reading infrastructure, to help build a knowledge base of expected

demand in the future.

Water supplies by tankers

Following an in-depth study of the practices in supplying water by tankers we carried out in 2010,

the situation is found to be complex and, in many areas, unregulated. In 2011, we will follow-up on

the recommendations we made in our study to ensure compliance of drinking water regulations at

the point of end-use as well as the improvement in management, reporting and control processes

for all categories of tankers and lling stations. A regulatory impact assessment may be included.

Wastewater security standards

Last year saw the approval of the rst wastewater security standards following extensive consultation

with ADSSC, the major sewerage services company in the Emirate.

In 2011, we will work with ADSSC to rene these standards and develop a reporting mechanism

based on key performance indicators. We will also begin to work with other sewerage service

licensees in this important area.

Additional work streams

Assess achievement of economic despatch Contractor health & safety performance

Connections process performance




Investing wisely

Asset risk management review

The Emirate of Abu Dhabi invests heavily in its

utility infrastructure. To avoid acute operation

and maintenance shortcomings, it is essential

that these assets are managed effectively from

day one.

This year, we will conduct an asset stewardship

review to assess the way network assets are

being managed. We will be considering how

best practice is being embraced to minimise

cost whilst maintaining performance and identify

improvements for the network companies to

adopt.

The capital efciency of network companies

In making price control proposals for network companies (transmission, distribution and wastewater

licensees) for the period 2006 to 2009, the Bureau made provisional allowances for network capital

expenditure with a view to determining the efcient level of spending, once audited information

was available on actual spending. The audited accounts and price control returns are now available

for 2009 and we are recruiting exper t technical consultants to assist with the assessment of efcient

spending. The consultants are expected to start work in early 2011.

As well as advising on the efcient level of spending to be allowed in the price controls, they will

advise the licensees on how to improve their processes and procedures in future, to encourage

efciency and encourage good practices such as life-time costing.

Additional work streams

Approval of 2010 BST Exceptional Charges and 2012 BST Leaet

Approval of 2012 TUoS Charges Statement

Approval of ADWECs 2011 Seven-Year Statement

Cost benchmarking dataset review and annual report

Review of 2011 AIS and TA Reports

Reviewing the approachto setting price controls

In addition to reviewing capital

expenditure for the period 2006 to

2009, we will look more broadly at our

approach to setting price controls and

regulating capital expenditure in the

future. Our objectives will be to increase

the incentives on licensees for efciency,

make sure that price controls properly

reect the importance of quality of

service, take appropriate account of the

Bureaus supervisory functions (such

as those relating to safety), while not

imposing undue burdens on licensees.


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Fullling a regulatory role

Enforcing regulatory compliance

Ensuring compliance with the licences and Regulations we issue is essential. It is also crucial that

enforcement procedures are transparent, fair and consistently applied.

In 2011, we will develop a compliance framework that sets out the various stakeholders roles and

responsibilities in cases of a breach of licence conditions.

Furthermore, in recent years, we have issued an increasing number of Regulations. This has heightened

the need to develop procedures for enforcing compliance with such Regulations, including channels

of consultation with other Abu Dhabi regulatory bodies and Government departments.

We will also be looking at creating and maintaining a register of enforcement actions taken by

the Bureau.

High voltage operations appraisal

The safe operation of High Voltage (HV) networks requires a high degree of competency. Currently,

there is insufcient control over the competence level of individuals and companies responsible

for operating these assets in customers premises (e.g. factories and district cooling plants). We

will therefore engage with licensees to ensure that operators of such networks are identied and

their activities reviewed, to ensure compliance with the established requirements for operating

and maintaining HV assets. A suitable training programme to raise competence levels and improve

standards, where required, will also be identied.

Wastewater regulatory compliance

The Trade Efuent Control and Recycled Water

and Biosolids Regulations were issued in June

2010. They set a legal framework for the safe,

economic and sustainable collection, treatment

and disposal of industrial wastewater produced

in the Emirate, and provide a set of quality

standards and management procedures for

recycled water and biosolids reuse. This year, the

Bureau will work with sector companies and

stakeholders to ensure compliance programmes

are in place, with key areas focused on review

panel initiation, low-risk trade efuent, codes ofpractice and process mapping.

Promoting health and safety

The health and safety performance

of the sector continues to fall short ofbest practice with signicant numbers

of accidents occurring. Since 2009, we

have been assessing the four network

companies health and safety procedures

and this year we will work to build on

the results, to ensure licence holders

improve in this critical area. We will focus

on consistent, sustainable and effective

measures being introduced to deliver

improved safety performance amongst

licensees and their contractors.



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Planning for the future

Renewable energy assessment

The plan to have seven percent renewable

energy sources by 2020 in Abu Dhabi will require

the Bureau to assess a range of renewable

generation technologies. As part of our licensing

activity, we will evaluate the implications of

connecting such sources to the power network

as they have different characteristics from those

of conventional power plants.

Additionally, we will work to develop

amendments to current regulatory policies, as

required, to accommodate the envisaged mix of

generation types.

Roadmap for the introduction of nuclear stations

In its 2030 Vision, Abu Dhabi is committed to securing sufcient power for the Emirate as well

as diversifying generation away from hydrocarbons to low-carbon technologies. The nuclearprogramme, led by Emirates Nuclear Energy Corporation (ENEC), is key, with 5.6 GW of nuclear

power committed; the rst phase of which is scheduled to become available in 2017.

The Bureau will be responsible for assessing the impact of this signicant additional power and its

integration in the Abu Dhabi power network. This work will be aligned with the nuclear programme

to establish a roadmap and key milestones to ensure its connection is consistent with maintaining

overall system reliability. This work will also develop the necessary licence conditions for the

connection of nuclear generation.

We will also work closely with the Federal Authority for Nuclear Regulation (FANR) who have

additional, specic, regulation duties in respect of the nuclear facility and technology employed

within the power plant. FANRs key responsibilities are to provide the regulation, licensing and

appropriate oversight of the obligations under the international treaties, conventions and

agreements in the nuclear sector entered into by the UAE.

Integrated planning framework

This years planning cycle has revealed shortcomings in sector companies abilities to plan adequately

to accommodate anticipated load growth and subsequent generation and network development,

in line with the objectives of the 2030 Vision. The Bureau will help the sector companies developan improved planning strategy to incorporate and articulate a long-term vision. The planning

framework would then be used and applied to all work streams involving the sector companies.


Review costs of renewableenergy projects

In 2011, we will continue to work on the

economic level of tariffs for Masdars 10

MW photovoltaic plant and its proposed

wind farm on Sir Bani Yas Island. This

work enables the Bureau to provide a

view to various Government agencies

and the Sector as to the suitability, or

otherwise, of the costs of these renewable

energy technologies.



Objectives

The primary duty of the Bureau, as set out in Law No (2) of 1998, is:-

To ensure, so far as it is practicable for it to do so, the continued availability of potable water for

human consumption and electricity for use in hospitals and centres for the disabled, aged and

sick.

Overall objectives are: -

To apply sound economic and technical regulation and supervision to all licence holders

throughout the Emirate of Abu Dhabis water, wastewater and electricity sector.

Ensuring full licensee compliance with all licence conditions, regulations, codes and other

documents in force.

Establishing sound documented management procedures for all Bureau functions.

Ensuring the welfare and development of all Bureau staff in order to enable them to meet the

objectives given in this work plan.

Representing the interests of all stakeholders in the water, wastewater and electricity sector

especially customers.

The Bureau will seek to achieve these objectives in accordance with the roles and responsibilitiesit has under the following laws:

Law No (2) of 1998 concerning the Regulation of the Water and Electricity Sector in the

Emirate of Abu Dhabi, as amended.

Law No (17) of 2005 concerning the establishment of the Abu Dhabi Sewerage Services

Company, as amended.



Sector structure

The structure of the Sector is illustrated in terms of its supply chain components. All companies

undertaking the regulated activities shown below must be in possession of a licence issued by the

Bureau.

Production of power and water is mainly in private hands and connects directly to the strategic

transmission company (TRANSCO) to enable the efcient movement of bulk supplies of water and

electricity to major demand and load centres throughout the Emirate. All water and power output

is purchased by a single buyer, the Abu Dhabi Water and Electricity Company (ADWEC).

The distribution and supply (sale) of water and electricity to customers is under taken by distribution

companies who are in possession of a distribution and supply licence. Currently, there are two

distribution companies in the sector: Al Ain Distribution Company (AADC) which covers the old

municipality region of Al Ain and Abu Dhabi Distribution Company (ADDC) which covers the old

municipality region of Abu Dhabi including Al Gharbia (the Western Region).

The wastewater collection network and treatment plants are predominantly owned and operated

by the Abu Dhabi Sewerage Services Company (ADSSC), with disposal of recycled water to

irrigation companies.

PWPA admin

Production

* PWPA = Power and Water Purchase Agreement

Transmission DistributionSupplysales

Customer

connections

Collection

Treatment

Disposal

Transmission DistributionWastewater

Irrigation

ADWEC Sells output to supply business


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umentreference:E

R/P01/016

P.O.Box 32800 Abu Dhabi,

United Arab Emirates

Email rsb@rsb o ae

Annual Workplan 2011 UAE Electricity

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