Profitably powering the building sector - AHK...

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Profitably powering the building sector

Renewable energy business cases

Facilitator

Simon Bittner | Profitably powering the building sector | 27.11.2015 |

PDP: Modules and Services

• Information dissemination and contact establishmentMODULE 1

• Reference ProjectsMODULE 2

• Framework conditions and legal environmentMODULE 3

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New publication:

Available at our booth

“Renewables Made in Germany”

F15

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The Hospitality Sector

Market overview


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• 30 % average annual growth in tourist and business visa arrivals

since 2012

Tourism Growth in Myanmar

-

100,000

200,000

300,000

400,000

500,000

600,000

2010 2011 2012 2013 2014

Tourist & Business Visa Arrivals to Myanmar

Total Tourist VisaArrivals

Total BusinessVisa Arrivals

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The Hotel and Condominium Industry

• 1,186 hotels and guesthouses in Myanmar with 46,690 rooms and

growing fast

• 48 major new projects of 200 rooms plus in Yangon alone since

2012, booming construction countrywide

• Over 100 condominium projects in

Yangon, 4,150 units added in 2014

• Average sale price of US$2,300 m2

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Tourism sector Myanmar

• International tourism centers: Yangon,

Nwe Saung & Ngapali Beach, Inle

Lake, Bagan

• Eco-Tourism

733

289

84

Grid-connection of Hotels in Myanmar

Good GridConnection

Fair GridConnection

No GridConnection

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Electricity supply situation

• Grid supply insufficient to provide 24

hours of electricity in most of the country:

most properties requiring diesel

generator back-up

• High electricity prices with Diesel

• 23-40 US-Cent per kWh

• Poor insulation of buildings leading to high energy costs

Commercial Consumption

(kw/month)

Grid Cost MMK/kWh

($cent/kWh)

Off-grid kWh Tariffs (est. ranges)

MMK/kWh ($cent/kWh)

up to 500

501 and above

75 (5,7)

Up to 150 (11.5)

mini-hydro/solar: 100-200 (7,7 – 15,4)

diesel generator: 300+ (23+)

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Typical Business cases

Nay Pyi Taw & Kyaing Tong hotels

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Business Case 1: Hotel Nay Pyi Taw

• Current electricity supply: Grid-

connection & Diesel gensets

• Solar PV as „fuel saving application“

parallel to the grid and diesel genset

without batteries

• Solar PV production never exceeds

internal power demand of hotel ( no

grid feed-in)

Source: Moerk GmbH & Co. KG

Business Case

Nay Pyi Taw

Proposed capacity PV 503.88 kWp

Required area on

rooftop3,172 m²

Spec. annual yield 1,493 kWh/kWp

Annual energy yield 752,308 kWh/year

Current electricity

costs0.20 $/kWh

Annual savings 149,000 $/year

Investment (just

components; no

import & installation)

654,271 $

Payback period 4.4 years


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• 19-room, family-owned hotel in

Kyaing Tong, the largest city in

eastern Shan State.

• Operates 7 days/week, full year

• Seasonality

High: November-February, Low-season: May-September

• Avg. utility cost: 160 kyats/ kWh ($0.133/kWh)

• Avg. diesel consumption: 150 litres/month

• Avg. diesel and utility cost: $333/month

Business Case 2: Princess Hotel

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Absender | Titel | TT.MM.JJJJ | Page 11

Monthly Grid Electricity Consumption


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Key Assumptions:

• 6 kWp solar PV system + battery

• 20 hours autonomy

• Business case: reduce grid-based

kWh and diesel consumption

Key Conclusions:

• Annual savings of $2,967

• Payback of 20 years

Business Case 2: Princess Hotel

Absender | Titel | TT.MM.JJJJ | Page 12

Technical and Financial Overview

PV system size: 6 kWp, roof-mounted

Battery storage:2000Ah, 48V (20 hours autonomy;

50% discharge depth)

Avg. annual PV

production:9,498 kWh

Avg. annual PV utilized: 9,498 kWh

System capital cost:

50,000 USD (24,500 USD for the

battery system)

Annual O&M cost: 5% of annual PV production value

Avg. annual savings: 2,967 USD

Simple payback period: 20.0 years

25-year savings: 74,175 USD

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Conclusions


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Good-Fair-No Connection?

733

289

84

Grid-connected Hotels in Myanmar

Good Grid Connection

Fair Grid Connection

No Grid Connection


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Top 3 determinants

• Electricity price

• High diesel consumption

• Constant electricity need

(no big seasonality,

300+ operating days)

becomes obsolete

once net-metering / Feed-

in-Tariff is introduced

Main determinants for an attractive business case

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Conclusions and Recommendations

• Electricity supply is one of the biggest challenges for the highly dynamic construction sector in Myanmar

• Solar PV is a technically and economically viable option• Business case for solar PV in the grid-connected hospitality sector is viable

• In fair-grid or off-grid situations, the business case depends on Diesel hours

• Key Barriers include• Limited financing options for solar projects

• Nascent regulatory framework, lack of standards and regulations (e.g. excess feed-in to the national grid) - but expected improved clarity in regulatory framework soon

• Recommended Actions• Collect and share data to make the business case for solar projects

• Develop pilot projects to showcase the viability

• Identify funding for these pilot projects

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Thank you for your attention!

Simon Bittner

[email protected]

www.giz.de/projektentwicklungprogramm

www.renewables-made-in-germany.com

Profitably powering the building sector - AHK...

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