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I. INTRODUCTION
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Efficiency gains in transmission for on-site applications Under deregulation, the delivery network is the vehicle
which minimizes line losses and voltage sag. through which competition occurs. The stronger the network,
Alleviation of congestion on the distribution network the less incidents of line congestion, the easier it will be to
through peak load shaving. site generating plants across the system. The dispersal of
generation across the network will facilitate competition in
IV. DG SERVICES AND STANDARDIZATION the generation sector.
Distribution generation in Nigeria is generally a point-to- In liberalized electricity markets, four key strategic issues
point radial connection from the generating machine straight relating to distributed generation (DG) are high on the agenda
on to the load centre. Examples are major cities such as of any distribution company [8], namely:
Calabar, Kaduna, Makurdi, Maiduguri, Minna and Suleja.
NEPA’s electricity distribution service to consumers cover a
How much distributed generation will appear in the
wider geographical area involving both radial and mesh
distribution networks?
networks used to supply electricity to several customers on
What effect will the DG have on the technical
the low voltage end of a bulk electricity delivery industry
performance of the network?
value chain.
What effect will the DG have on the financial
Figure 3 shows an application of embedded generation
performance of the utility?
interconnected with the grid to serve large customers and
What changes in technical design or commercial practice
provide grid support.
will be effective within a distribution utility DG strategy?
Transmission Network For Nigeria, the on-going ESI restructuring process needs
to address pertinent issues regarding DG and their impact on
the operations of local Distribution Network Operators
Distribution Network (DNO):
CHP Gen
Will the DNO created from NEPA to serve franchise
areas have the monopoly status as the sole provider of
Distributed Generation
(e.g. wind turbine) electricity in their region, especially in rural areas, and are
they required to oversee the operations of DG connected
Industries with CHP to their networks, as they affect their wider network
generate electricity which
flows back to the network system integrity? The main concern here will be how to
Flow from the network Domestic customers and small businesses with stop DNO abusing their monopoly power.
Domestic Generator can also generate electricity
Flow from, and to the network which flows back onto the Distribution network DG owners are also concerned about reliability of DNO
networks after deregulation and privatization, taking cue
from the current performance of NEPA’s distribution
Fig.3. DG Operating Environment
sector [9].
What impact will DG connected to the local distribution
Such innovative deployment of typical DG technologies network have on network reliability?
can serve the coastal regions like Lagos, Warri and Port Lastly, the issue of remuneration for services provided by
Harcourt where wind energy can be harnessed. Major DG to support local DNO.
manufacturing and mining cities such as Kaduna and Jos in
the interior as well as Lagos can benefit from CHP To encourage investment and promote competition, the
technologies as well as surrounding settlements. In Nigeria, following is proposed: introducing DG into the power
small-scale on-site distribution or embedded generators have planning mix and load forecasting, the standardization of
been established along side NEPA’s 11 to 33kV distribution network requirements (DG) and open access to the network.
networks. These small generators (mainly diesel or furnace Both the DNO and DG operating and maintaining electricity
oil-fired) supply power to industries and in some cases distribution service in their franchise area must be
communities/estates attached to them, through indigenous accountable to the customers and the industry regulator.
private distribution networks. NEPA has not taken advantage These should be clearly spelt out in the policy, which should
of the opportunities provided by DG to alleviate the problem undergo development as the new era unfolds.
of power shortage especially in rural electrification program
in the country. Over emphasis on costly conventional large It should be noted that there will be financial, geographical
centralized electricity supply facilities has deprived many and environmental constraints on quick capacity expansion of
customers the benefits that DG located in their area could generation, transmission and distribution facilities which
provide.
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NEPA’s successor companies will face during post can be used in a combined mode cycle to fire a small steam
deregulation and privatization. turbine thereby improving efficiency. Their maintenance
costs per unit of power output are among the lowest of all
V. DG TECHNOLOGY OPTIONS FOR NIGERIA generating technologies. They are most suitable for light
industrial and commercial establishments, plus rural domestic
In the short to medium term demand for electricity will use.
continue to out strip supply, because of constraints of time
lag of building conventional large generating, transmission C. Solar Power
and distribution infrastructure. The huge demand for
electricity calls for investments in more DG across the Solar power systems use sun tracking mirrors to reflect and
country. Private investors and DNO should be encouraged to concentrate sunlight unto a receiver where it is converted to
set up DG closer to consumers. DG should be considered as high temperature thermal energy. The heat is then used to
an option to other co-operative solutions as: network drive an engine or electric generator. At a cost of US$650 for
upgrades, up-rating and integration of protection, metering, a 55W solar power system [10], such power source is
control, and voltage support. DG should be used as an
unaffordable to most rural households in Nigeria. However,
additional measure to bring electricity to the masses, and
this type of DG is suitable for remote rural energy supply
industrial concerns especially in rural areas. Figure 4 shows
applications for powering telecommunication base stations
typical cost trends for the electricity supply. In the context of
Nigeria with abundant fossil resources and year round and outpost rural emergency services locations like police,
sunshine, the following DG options are credible: health centres etc.
It should be mentioned that the use of micro-fabrics for DG
A. Combined Heat and Power (CHP) has been canvassed as a means of eliminating the problem of
gas-flaring in on-shore and near shore oil rigs in the Niger-
It involves capturing waste heat from power production Delta region of Nigeria. This will minimize the impact of
and putting it to some useful purpose at the customer site. these gas-fired DGs on the environment.
They are mostly gas-fired plants. It offers fuel operational
efficiency of 70% in pulp, paper, chemical/petrochemical and VI. TECHNICAL AND ECONOMIC EVALUATION
refining industries. OF DG OPTIONS
These are a class of modular gas-fired generators that Quantify the costs/values that energy produced by DG
produce high-temperature high-pressure gas to induce shaft contributes to the cost of good/services or the quality of
life in the DNO area. Cost and benefits would include
rotation by impingement of the gas on specially designed
ecology, opportunity, risk, depletion and the traditional
blades. Typical efficiencies (without use of external exhaust
direct cost/value set.
heat) range from 21 to 40%. Their high quality exhaust heat
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Identify a method for quantifying cost and benefits that is challenges confronting government officials and their
more appropriate than the current distribution tariff advisers fall into these broad categories:
methodology.
Identify method(s) for resource planning and modeling A. Legal and Regulatory Framework
that is responsive to real-time cost and new technology,
and compatible with distributed, disparate resources. The The structure of the legal and regulatory framework must
method should be able to evolve, adapt, and learn as part offer incentives for current and future DG to participate in
of its architecture. electricity trading after deregulation, whilst accommodating
Define an operational methodology that supports and the wider responsibility and interest of local DNO. In this
encourages participation (e.g. easy entry and exist) in a regard the issue and modality of open access regime and
deregulated energy market. The method must be cost connection agreement by which the DG has access to the
effective and developers must define the information DNO’s network must be well defined.
required to enable the method.
Developers must define the characteristics of the
B. Network Access Regulation
information (such as resolution, latency, size, speed and
volume), identify ways to collect, interpret, store, share
DG modes of operation should be identified alongside the
and value the information.
Developers must define the information management appropriate engineering and commercial boundaries. This
regime (data access, reduction, storage, response, will require supporting infrastructure such as protective
interpretation, aggregation, ownership, archiving). relays (e.g. voltage/frequency relays), metering, and data
collection. Payment for services provided by DG operators to
Regulatory Economic
DNOs to support the system must be provided, as well as
Legal / Operational
framework
Start Up &Running
Costs
services provided by DNOs.
Technical
Environmental Avoidable cost Manufacture Data
Planning permit Payback period Security / Safetyof Equipment
Reliability / Power Quality C. ESI Operation and Financial Management
Qualify Operator
Sell Power
Yes
Any Excess
Yes DG meets No To overcome the above challenges and provide an
total Power
to DNO Power ? requirement appropriate environment to enable effective technical and
viable commercial operation of DG after deregulation, the
No following recommendations are proposed:
Yes Buy Short Fall
fromDNO?
1) DG Definition: A definition is required of what
constitutes distributed generation. Such definition should
Fig.5. Assessing Viability of DG Investment provide a clear explanation of DG operators’ technical
and commercial boundaries within the geographical area
VII. CHALLENGES OF DG UNDER ESI of the DNO. This must be included in the electricity
DEREGULATION reform bill that will give legal authority to the
restructuring and unbundling of electricity industry. For
As countries all over the world deregulate and restructure example a DG owner may be restricted to a point-to-
their electricity industry; they are confronted with the point radial connection to serve demand requirement of a
challenges of setting up appropriate regulatory and properly recognized load (e.g. an industrial plant). In
contractual arrangement that accommodate and promote the consented cases, allowing for any excess energy
interest of DG embedded within the wider geographical produced and not required by the demand to be split or
boundary of a franchised local DNO [11]. In the process of passed on to the DNO network at a mutually agreed
deregulation of the electricity industry, the probable quality and time, and meet statutory requirements.
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ACKNOWLEDGMENT
2) Legal and regulatory codes: Appropriate legal and
regulatory codes must be set up: These codes will be the The author wishes to thank Abimbola Odubiyi for
bases for legal contractual arrangements that govern the providing useful information and comments which have
interactions between a DG and a DNO. The codes that added value to this work.
govern:
Technical and commercial design codes such as
connection standard, metering and payment. REFERENCES
Provision of ancillary services such as voltage
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substation), the charging principles and mechanism Consortium for Electric Reliability Technology Solutions, (Lawrence
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IX. CONCLUSION
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