Saudi Electricity Company (SEC) Restructuring Project

Transcription

1 Saudi Electricity Company (SEC) Restructuring Project الشرآة الوطنية لنقل الكهرباء National Grid SA 1 Contents Restructuring Targets SEC & The Subsidiaries Organization Structures National Grid SA Organization Structures Restructuring Impact on SEC External Stakeholders 5 Future Steps 2 1

2 Restructuring Targets 3 Restructuring Targets unbundling a monopoly is a pre-requisite for market liberalization, which in turn provides long-term benefits such as: Competitive market which improve productivity, operation efficiency and quality of service. Attract investment, that will contribute to satisfy the requirements of the large growth rates in electricity demand It is very important to keep and maintain power system stability, so restructuring will be implemented gradually, such that there would be no impact on services provided by SEC 4 2

3 Preparation for Electricity market In year 2000, SEC consolidated all electricity companies (10 Companies and 11 Electricity Projects) in one company named the Saudi Electricity Company (SEC). A new organization structure was developed based on business functions (Generation, Transmission and Distribution). All employees of the merged enteritis were placed in the new organization structure. Financial separation of the business of generation, transmission and distribution Procedures unification, best practice implementation and improvements programs. Integration of automated systems and move to the comprehensive Enterprise Resource Planning (ERP) system Strengthening the capacity of generation, transmission and distribution networks 5 SEC Board Decision Restructuring of SEC Generation, Transmission & Distributions Businesses to the following subsidiaries: DISTCO National Grid SA 4 GENCOs All subsidiaries are limited liability Companies and fully owned by SEC No impact or change on shares or shareholders due to restructuring. A consolidated financial statement will be published by SEC incorporating Subsidiary Companies financial results. 6 3

4 SEC initiated the unbundling process by establishing 6 subsidiaries within a Single Buyer market structure Expected Unbundling Stages of SEC Before 1/1/2012 Transition Stage Medium-Term Stage Long-term Stage SEC (vertically integrated) 4 Gencos SEC Holding 100% 100% 100% National Grid SA Distrco Ownership Separation of Transmission or Generation Companies from Holdco Further Unbundling & Restructuring Single Buyer Market Focus Principal Buyer Market with Wholesale Market Competition Open market with retail competition and market exchange 7 Accordingly, new contractual interfaces and financial flows will need to be put in place Contractual Interfaces and Key Financial Flows Contractual Agreement Financial Flow Customers Sales Agreement End-user Tariffs Distribution Company Transmission Company Genco Generation Genco A Genco A ACompany 4 Service Lease Lease Collected Service Lease Lease Service Level Agreement Revenue Revenue Level Agreement Revenue Level Agreement Agreement Agreement Power Purchase Agreements Energy & Capacity Revenue SEC (Holding) Company Note: Service charges related to SLAs are not shown to simplify figure 8 4

5 In summary, the new organization model is based on the following allocation of responsibilities Holding Company Prepares and approves system planning (including generation expansion plan) and budgets Performs long-term fuel planning and administers fuel supply agreements Provides financing Develops new power plants, tenders IPPs and administers their contracts Develops EHV transmission system and interconnections Acts as the single buyer of electricity and leases transmission and distribution capacity Provides shared services to subsidiaries Monitors the performance of subsidiaries Liaises with ECRA for all regulatory matters 9 Distribution Company Owns, operates and maintains the distribution network Issues substation demand forecast (sales and consumption) Performs distribution network planning and executes projects Manages customer services, billing and collection Manages small isolated generators Transmission Company 1. Ownership, operation and maintenance of transmission networks. 2. Operation and control of the electrical system. 3. Monitor network performance, and economical operation of power plants. 4. Preparation requirements of transmission networks. 5. Design and implementation of transmission projects (high voltage). 6. Submit periodic reports on the performance of the transmission company to the Holding Company. 7. Issuing budgets quarterly, and annual. Generation Company A Owns, operates and maintains power plants Plans and executes enhancements, rehabilitations, replacements and extension projects SEC & The Subsidiaries Organization Structures 10 5

6 SEC Organization Structure

7 The Optimized Grouping is a major shift from the current geographic distribution Gencos Power Plants Location (During Period ) Al-Qurayyat Arar Tabarjal Al-Jouf Rafha Tabouk Hail Qaisuma Ras Al Khair Duba GT Safaniyah Berri Ghazlan Juaymah Dammam Al-Wajh Al-Qasim Shadgum Qurayyah Qurayyah CC Madinah PP12 Faras Ras Abu Qamees Al Rais PP13 PP9 Uthmaniyah Rabigh New PP5 Rabigh PP8 PP14 Jeddah Makkah PP7 Jeddah South PP10 Taif Shoaiba Bisha Layla Shoaiba CC Baha Tihama Juba Asir Shoqaiq Najran A B Jizan GT Sharourah C D

8 Organization Structure for National Grid SA Regulatory Affairs Board of Directors CEO Transmission Finance Business Coordination Technical Services Engineering Planning Projects Grid Maintenance Operation &Control Division Department BU 15 National Grid SA Organization Structures 16 8

9 As of 1/1/2012 National Grid SA Is Alive 17 National Grid SA Go Live Steps Finalization of National Grid SA Company establishment procedures. Appointment of Board of Directors members. Appointment of CEO. Finalization of Organization Structure approved by Board of Directors. Appointment of Executive Management. Automated systems update. Transfer of Employees and other resources from SEC to National Grid SA. 18 9

10 Organizational Structure of the National Grid SA Regulatory Affairs approved Level I and II approved Board of Directors CEO Transmission Finance Business Coordination Technical Services Engineering Planning HV Projects Grid Maintenance Operations and Control Commissioning Services Asset Quality Performance Tele Communications Services Research & Development Planning & Coordination Engineering & Design Engineering Protection Telecom Engineering and SAS Standard & Specifications Planning & Coordination Network Planning Planning Support Engineering Services Planning & Coordination Projects Central Projects West Projects East Projects South Projects Support Planning & Coordination Grid Maintenance Sector -COA Grid Maintenance Sector -WOA Grid Maintenance Sector -EOA SOA Grid Maintenance Planning & Coordination Operation & Control COA Operation & Control - WOA Operation & Control - EOA Operation & Control - SOA National Control System Operation Planning System Control Section 19 Dept. Sector BU Planning & Coordination Duties & Responsibilities of Operation & Control Business Unit To operate & control power transmission system kingdom Wide in economical & secured operation and safe condition

11 Duties & Responsibilities of Operation & Control Business Unit Al Jouf T T Tabook Hail T Qassim T Qaysumah Dammam T C Yanbu Jeddah T Madinah Riyadh T NCC Jubbah T W NC C S E Abha T Najran T 21 Duties & Responsibilities of Grid Maintenance Regional (COA, WOA, EOA & SOA) To operate and maintain the Transmission Network in the Region adopting cost effective maintenance practices, optimum maintenance scheduling per established maintenance policies and procedures, enhancing safety and life of the equipment

12 Duties & Responsibilities of Grid Maintenance Regional (COA, WOA, EOA & SOA) 23 شبكة الا لياف البصرية Fiber Optic Network 24 12

13 Duties & Responsibilities of Projects Business Unit To manage the projects execution from awarding up to close out stages for the HV ( 110 up to 132 ) system in all regions (COA, WOA, EOA, SOA). To Implement and approve project programs. To Review, monitor and accept contractor construction procedures. To Manage relationships with contractors to maintain an ongoing dialogue with regular feedback. 25 Duties & Responsibilities of Planning Business Unit Do the Network Planning and studies for the HV system in all regions (COA, WOA, EOA, SOA), Follow up, Monitor and document the Load Forecast, secure Capital & Operating Budget, Right of Ways for transmission facilities, keep and update the documentation and Geographical Information Systems

14 Duties & Responsibilities of Engineering Business Unit To prepare e and Provide the SOW, engineering & designs packages and engineering support during the various stages of projects of the HV Transmission Network Systems including Substations, Transmission Lines, Protection and Telecommunications in all regions (COA, WOA, EOA, SOA). 27 Duties & Responsibilities of Technical Services Business Unit To undertake commissioning of the newly installed transmission assets and ensure that they meet the Company Standards & Specifications and are operating as designed, Act as interface between System Operation and Project management in the energization of Transmission projects, Monitor the Asset Performance and Service Quality To conduct frequent audit on project design packages and factory test reports to ensure that all Transmission Projects are properly Design from all aspects and to conform that operation and maintenance and others positions & requirements are incorporated To assure that all activities from project start-up until completion are bound within the framework of the Quality system 28 14

15 Growth Indicators Years Future Growth Current Situation Voltage Level Main Indicators Growth 2017 Growth % % EHV HV Total Length of O/H & U/G Circuit KM EHV HV Substation Numbers EHV HV Transformer Numbers 29 Restructuring Impact on SEC External Stakeholders 30 15

16 Restructuring impact on External Stakeholders In the next stage, work will remain according to existing policies and procedures and No changes will happen in dealing with all categories of consumers, contractors, suppliers and Banks. 31 Future Steps 32 16

17 Future Steps SEC is now performing the activities required for the unbundling of the four GENCOS and DISTCO during This situation will continue until the realization of the prerequisites for the transition to open market and competitive market liberalization. 33 Market Liberalization Requirements Through a study undertaken by SEC with a Consultant, it has became clear that: All countries who have liberalized their electricity market, have had the basic requirements (which are currently not available). The most important of which are: 1.The availability of balanced tariff that reflects the cost for every category of consumers to ensure adequate revenue for the Sector or a clear Governmental commitments to cover the deficit. 2.Availability of an acceptable reserve margin (from 10% to 15%) of generation capacity during peak time. 3.Availability of reliable and inter-connected transmission system in Kingdom 4. A flexible and quick mechanism to modify tariff according to the variables to encourage investment

18 Thank You 35 18