Electricity market restructuring, energy tariff policies, generation capacity expansion plans, opportunities for international trade, and the role of IPPs are among some of the major policy issues concerning energy planners in the South Asian nations of Bangladesh, Bhutan, India, Pakistan, and Sri Lanka. Still, in many parts of South Asia, there is very limited electricity market modeling analysis capability. This proposal documents how a standardized and transparent electricity marketing policy analysis capability can be established in the region which can be a strategic benefit immediately to these nations. The proposal also outlines how the process would continue to build substantial improvement in that capability. It can be achieved through transfer of proven large-scale energy network planning technology from Purdue University to regional researchers, utility planners and government regulators, and through the regional institutions becoming collaborative partners in a proposed collective planning forum, the South Asia Electricity Modeling Consortium (SAEMC). The technology and essential foundational knowledge transfer would be conducted through a series of three training sessions; planned for February 2004 (Dhaka, Bangladesh), June 2004 (Purdue, USA) and March 2005 (New Delhi, India). The construction and use of national electricity market models, of the type proposed, will provide instant quantitative help to each of the participating countries as a decision support tool during each country’s electricity planning deliberations. A further benefit is that these country models will be constructed using a common set of definitions and a common structure for all countries. This will facilitate the process of cross national comparison of projects as well as future collaboration across the South Asia region for the planners of the 21st century. The real growth in India’s gross domestic product (GDP) was 4.8% for 2002, and was also projected to rise to 5.7% in 2003. To meet growing demand in electricity the government has targeted capacity increases of 100,000MW over the next ten years. As of January 2001, total installed Indian power generating capacity was 112,000 MW [1]. The proven reserves of natural gas in Bangladesh and Pakistan [2], coal in India and future hydropower capabilities of Bhutan and Nepal represent enormous potential export earnings for each of these countries as well as supplying the high electricity demand growth rates for each country (around 10% compared with 2% in the USA). In each of these countries
there are major electricity restructuring initiatives now being considered. Developing therefore the national electricity market models, to support the high level energy decision making process, by government energy advisors, is most timely.
The Purdue Energy Modeling Research Groups, PEMRG, of Purdue University (West Lafayette, Indiana, USA) have over 20 years of experience in constructing models which have been used as decision support tools both in the Mid-West USA (Indiana and the ECAR-MAINregion of NERC) and internationally with the Southern African Power Pool (SAPP) and the West African Power Pool (WAPP) [3-8]. The academic link that was established in 2003, during the Phase 1 of SARI/Energy, between Purdue and the Bangladesh University of Engineering and Technology (BUET, Dhaka, Bangladesh), is an ideal foundation for expanding the training and promoting electricity policy analysis skills that are required for providing the substantial and in-depth quantitative policy analysis to national government energy planners and utilities across the South Asia region. It is planned for BUET to be the coordinating regional institution of the proposed SAEMC.