Detalles del proyecto

Visión general

Título del Proyecto

Strengthening Knowledge Sharing in Indonesia - International Electricity Sector Restructuring Specialist

Programa País / Plan de Acción
Tender / Procurement notice
11 ene 2019

Publicado

11 enero 2019

Fecha limite

17 enero 2019

Presupuesto

45 000 USD


Tipo de aprovisionamiento


Consultores individuales

Referencia

48172-001 Package International Electricity Sector Restructuring Specialist

Agencia de Financiación

ADB - Banco Asiático de Desarrollo


Duración estimada

5 meses


Países

Indonesia

Date Published: 11-Jan-2019 Deadline of Submitting EOI: 17-Jan-2019 11:59 PM Manila local time

Consultant Type Individual
Selection Method Individual Consultants Selection (ICS)
Source International
Technical Proposal Not Applicable

Selection Title Strengthening Knowledge Sharing in Indonesia

Package Name International Electricity Sector Restructuring Specialist

Advance Action No

Engagement Period 5 MONTH

Consulting Services Budget USD 40,000

Budget Type Estimated

Approval Number 8858
Approval Date 19-Dec-2014
Estimated Short-listing Date 18-Jan-2019
Estimated Commencement Date 11-Feb-2019

Open to non-Member Countries No

Additional Information
Country of assignment Indonesia


Contact Information
Project Officer Emma Allen
Designation Country Economist
Asian Development Bank
Email eallen@adb.org
Contact Person for Inquiries Florian Kitt
Designation Energy Specialist
Asian Development Bank
Email fkitt@adb.org

Agencies

Primary Agency Country Agency Role Contact Person
National Development Planning Agency (BAPPENAS) Indonesia Executing Agency Rachmat Mardiana

Cost Estimate


Cost Items Amount in USD

Remuneration and Other Expenses
All activities and inputs in the TOR but not limited to remuneration, per diem, air travel, miscellaneous travel expenses, report preparation, production, and transmission, land transportation, communications, etc. 43,833
Contingency 1,167
TOTAL

45,000

Terms of Reference


Expertise Electricity Sector Restructuring

Expertise Group Organization Management & Strategy Development
TOR Keywords

Source International

Objective and Purpose of the Assignment The Government of Indonesia is currently planning to develop its next 5-year medium term development
plan setting the targets for a sustainable, affordable, and secure energy sector. The ADB’s Country
Partnership Strategy outlines the ADB’s support to Indonesia in planning for a more sustainable energy
sector. One question is how Indonesia could best organize its electricity sector to achieve (i) nation-
wide electrification, (ii) increasing sustainability of electricity generation with a view to reach the
25% share of renewable energy in the electricity sector, and (iii) continue to provide affordable
electricity to end-consumers. TA 9511-INO: Energy Sector Assessment and Priorities for the RPJMN in
Indonesia provides analytical support for strengthening the government’s policy agenda, including policy
advisory services for strengthening the energy sector. To support this work, it is necessary to review
the organization of the electricity market and the role and structure of the dominant state-owned and
vertically integrated utility PLN. The work aims to develop recommendations on how restructure the
electricity sector to support electrification, the development of indigenous and renewable energy
sources, and sustain affordable energy prices while decreasing the differential between production cost
and end-consumer prices. The assignment will outline alternative models for the electricity sector and
discuss how to restructure PLN, the State-Owned Electricity Company.

Indonesia opened the generation market for independent power producers (IPPs). This gave utilities the
power to buy electricity from so-called “qualified facilities”, which were mainly co-generators and
small power producers. This model is known as the single-buyer model. The single-buyer model introduces
a limited form of competition in power sectors by allowing IPPs to compete to build and operate power
plants. However, a defining feature is that IPPs may only sell to existing utilities, which usually
remain vertically integrated. It was expected that IPPs would not only relieve governments’ budgets of
the financial burden of power sector investment, but also promote competition, resulting in higher power
sector efficiencies and lower rates for consumers. However, these gains can only be achieved if the
appropriate regulatory environment is in place. The IPP experience has been mixed and certainly not the
most cost-effective, the costs of unserved electricity due to under-investment in power generation are
much higher.

The TA aims to look into alternative models for market organization analyzing among others the following
concepts for the Indonesian market:

• Electricity legislation, commercialization and corporatization: As a first step, countries must
provide sound legal fundamentals. This should involve the corporatization and commercialization of
utilities. Commercialization transforms state-owned utilities into separate (from the
ministry/government) legal entities with all associated rights and duties such as management structures,
hard budget constraints, borrowing, procurement, staffing, payment of taxes and dividends.
Corporatization should accompany commercialization, which involves cost recovery in pricing and
financial transparency through the adoption of (internationally) recognized accounting standards,
including explicit accounting of potential subsidies.

• Vertical unbundling: This includes functional decomposition of the electricity supply chain into
competitive segments (wholesale generation and retail supply) and natural monopoly segments
(transmission and distribution). Natural monopoly segments must still be regulated as these constitute
monopolistic bottlenecks or essential facilities which are absolutely necessary to provide electricity
to final customers. The four most common forms of unbundling are (i) account unbundling with separate
accounts for network and generation activities; (ii) management unbundling, which requires, in addition
to separated accounts, separate management for generation and network activities; (iii) legal unbundling
which requires separate legal entities for generation and networks; and (iv) ownership unbundling where
generation and network activities have to be owned by separate entities with no shares in either
activity. Among these four forms, account unbundling is the least drastic form of unbundling, whereas
ownership separation is the strictest form.

• The establishment of an independent regulator: The duty of the regulator is to bring economic
efficiency, transparency and a level playing field to the electricity sector by ensuring non-
discriminatory access to essential facilities–transmission and distribution networks–for generators and
suppliers in order to ensure fair competition, and through it, fair and efficient rate regulation.

• Establishing wholesale and retail markets: Regulated prices are replaced with market prices in the
respective competitive industry segments. Market designs need to take into account the specific nature
and condition of the electricity system which include various issues, among them technical (non-
storability, continuous physical balance, etc.), economic (e.g. capital intensity, long lead times), and
institutional which are associated with pricing, contracts, scheduling, balancing and network
constraints (Hogan, 1998). The marketplace ranges from near-instantaneous markets, to day-ahead hourly
spot markets to future and forward markets trading electricity several years ahead.


Scope of Work The consultant will outline alternatives to the organization of the electricity sector, restructuring
options for PLN, taking into account the changing business environment, best practice by other
countries, earlier proposals and studies conducted by the government and provide suggestions how to best
start building a sustainable and modern electricity market for the future that can ensure security of
supply, help in identifying possible incentives to develop renewable energy sources and implement energy
efficiency measures affordability of electricity prices, and sustainability of generation while
continuing to fulfil its public service obligation in a geographically difficult island-nation.


Detailed Tasks and/or Expected Output Key tasks and outputs will be targeted lectures and written report/study on a changing business
environment in the electricity sector–recommendations for a vertically integrated utility in a
traditional market.

(i) Review and assessment of the key changes and responses to a changing electricity market environment
and outline the options for electricity sector reorganization.

(ii) Case studies how utilities can be restructured to successfully respond to a changing business
environment.

(iii) Recommendations for Indonesia how to restructure the electricity sector and ensure a business
model that can deliver electrification, affordability, and sustainable energy.

(iv) Conduct three expert seminars with relevant stakeholders to give lectures on electricity sector
reform and regulation.

These outputs will be prepared through intensive consultation and discussion with PLN, universities,
business organizations, development partners and private sector companies to ensure that their knowledge
is taken into account.


Minimum Qualification Requirements The candidate should have a minimum 10 years experience in the deregulation of the electricity sector,
the regulation of formerly vertically integrated companies, and knowledge of electricity markets around
the world.


Minimum General Experience 10
Years

Minimum Specific Experience (relevant to assignment) 10
Years

Regional/Country Experience Desired

Schedule and Places of Assignment (chronological and inclusive of travel)


Schedule Type Continuous

Max. Working Days/Week Home Office 5
Field 6

City and Country Working Days Estimated Start Date Estimated End Date Other Details (use if place selected is Others)
Home Office, Other 2 18-Feb-2019 28-Feb-2019
Jakarta, Indonesia 5 04-Mar-2019 08-Mar-2019
Home Office, Other 5 11-Mar-2019 23-Apr-2019
Jakarta, Indonesia 5 24-Apr-2019 30-Apr-2019
Home Office, Other 5 01-May-2019 09-Jun-2019
Jakarta, Indonesia 5 10-Jun-2019 14-Jun-2019
Home Office, Other 3 15-Jun-2019 30-Jun-2019

Total
30