00060776 Wind Hybrid Power Generation (WHYPGEN) Market Development Terminal Evaluation Report

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Evaluation Plan:
2016-2020, Indonesia
Evaluation Type:
Final Project
Planned End Date:
06/2017
Completion Date:
07/2017
Status:
Completed
Management Response:
Yes
Evaluation Budget(US $):
15,000

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Title 00060776 Wind Hybrid Power Generation (WHYPGEN) Market Development Terminal Evaluation Report
Atlas Project Number: 00060776
Evaluation Plan: 2016-2020, Indonesia
Evaluation Type: Final Project
Status: Completed
Completion Date: 07/2017
Planned End Date: 06/2017
Management Response: Yes
UNDP Signature Solution:
  • 1. Energy
Corporate Outcome and Output (UNDP Strategic Plan 2018-2021)
  • 1. Output 1.5.1 Solutions adopted to achieve universal access to clean, affordable and sustainable energy
SDG Goal
  • Goal 7. Ensure access to affordable, reliable, sustainable and modern energy for all
SDG Target
  • 7.1 By 2030, ensure universal access to affordable, reliable and modern energy services
Evaluation Budget(US $): 15,000
Source of Funding: WHYPGen Project
Evaluation Expenditure(US $): 12,500
Joint Programme: No
Joint Evaluation: Yes
  • Joint with Donors
  • Joint with BPPT
Evaluation Team members:
Name Title Email Nationality
M. Lulu Gozali Technical Analyst lulu.gozali@undp.org
Dinesh Aggarwal
GEF Evaluation: Yes
GEF Project Title: Wind Hybrid Power Generation (WHyPGen) Marketing Development Initiatives
Evaluation Type: Terminal Evaluation
Focal Area: Climate Change
Project Type: FSP
GEF Phase: GEF-4
GEF Project ID: 3953
PIMS Number: 4223
Key Stakeholders:
Countries: INDONESIA
Lessons
Findings
Recommendations
1

Recommendation 1:

The corrective action for the design on the project is that in all the cases where there is a significant change in the focus of the project from the PIF stage to the project design stage, corresponding changes in all the components and the activities should be made. If required the components, indicators, activities and the corresponding outcomes may be re-written.

 

2

Recommendation 2: The corrective action for the monitoring and evaluation is that the members of the project board should have an agreement about the objectives and activities to be carried out under the project. The PIF of the project was conceived, considering that the wind component of the WHyPGen would be able to part replace the diesel based power generation capacity. This assumes that wind energy will be available throughout the year. The idea of part replacement of diesel-based power generation capacity with wind (in a hybrid mode) is not a realistic situation. The fact that implementation of diesel-hybrid system would require additional capital expenditure (not just incremental, as wind is not a continuous source and the seasonal variations are from 0 to 100%) got missed out. The reason for this seems to be the lack of inputs from the wind energy experts at the time of project design.

3

Recommendation 3:

It is recommended that at the time of project design, inputs from the technical experts for the technology being promoted must be taken. As was pointed out in the MTR as well, when it comes to the project goals, the targets were a bit ambitious. This is considering that the timeframe assumed for implementation of the pilot / demonstration projects is very optimistic, as the time required for collection of wind data and doing a realistic wind resource assessment itself takes more than one year.

4

Recommendation 4:

The corrective action for project design is that while putting up a time frame for the demonstration projects a realistic time frame needs to be provided, considering the technology specific project implementation issues and required timelines.

The assumption that it would be possible to create capacities / capabilities to produce wind turbines locally within the implementation period of the project was slightly unrealistic. The important point which got missed out while making this assumption is that the softer part of the technology (design and detailed engineering) of the wind turbines and wind power technology is important and having good engineering facilities within the country alone is not sufficient to enable production of components and parts of wind turbines. The lesson learnt is that while making efforts towards producing high-tech capital equipment in a country, it is necessary to lay equal emphasis on the software (designs, technical know-how and detailed engineering) as well as hardware part (precision manufacturing technology).

 

5

Recommendation 5:

It is recommended that for the project which has a component of developing local technical capacity for production of sophisticated equipment, at the time of project design there should be emphasis on the software part of the technology (know-how, detailed engineering, designs etc.) as well and identification of technology source should be included as one of the activities.

6

Recommendation 6:

It is recommended that while designing the projects having a demonstration component, some fiscal incentives should be provided to such demonstration projects.

The project design has rightly recognized technology gaps and skills as one of the barriers. To address this barrier, the provisions made in the project design were not adequate. The critical part that was missed is the identification of the right and most appropriate technology, its source and the ways to infuse it in the country. Thus, an important technology consideration of the design of rotor blades and the connected generator was not addressed in the project design.

7

Recommendation7:

For addressing the barriers of technology (particularly in cases where the technology is not locally available), apart from capacity building and training, equal emphasis should be given to technology sourcing and the ways to infuse the technology in the local conditions.

One of the significant achievement of the project has been uptake of ‘large scale grid connected’ wind power projects in Indonesia. This happened due to the support and help provided under the WHyPGen projects in terms of wind resource assessment, identification of potential sites for wind power projects, etc. The technical information created under the project was widely disseminated through the dedicated web site.

8

Recommendation 8:

In order to continue to get the benefits from the database and useful technical information, it is recommended to continue the availability of information at the website.

From the view point of policy and regulations, one of the issues is that the WHyPGen project has not been able to get approved a feed in tariff policy for wind power projects. Absence of such a policy regarding feed in tariff is one issue which may impact the benefits of the WHyPGen project.

9

Recommendation 9:

It is recommended that the efforts be continued to get the approval for the feed in tariff for wind power projects. This may be perused by the newly created, Wind Association or any other suitable organisation

1. Recommendation:

Recommendation 1:

The corrective action for the design on the project is that in all the cases where there is a significant change in the focus of the project from the PIF stage to the project design stage, corresponding changes in all the components and the activities should be made. If required the components, indicators, activities and the corresponding outcomes may be re-written.

 

Management Response: [Added: 2017/12/20] [Last Updated: 2017/12/20]

Recommendation 1's Management Response:

Noted. The project has made adjustment to the component’s success indicator as recommended in the Mid-Term Review, and has used it in the reporting and planning activities. The adjustment had also been updated to the project board, and the project activities had been adjusted to the agreed indicators. To re-write the components, indicators, activities and outcomes seems to be challenging as this already at the end of the project implementation phase.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
The final report of the project will still refer to the previous components, indicators, activities and outcomes that has been updated based on the Mid-Term Review and has been agreed by the Project Board.
[Added: 2017/12/20]
Herry Desha 2017/12 Completed History
2. Recommendation:

Recommendation 2: The corrective action for the monitoring and evaluation is that the members of the project board should have an agreement about the objectives and activities to be carried out under the project. The PIF of the project was conceived, considering that the wind component of the WHyPGen would be able to part replace the diesel based power generation capacity. This assumes that wind energy will be available throughout the year. The idea of part replacement of diesel-based power generation capacity with wind (in a hybrid mode) is not a realistic situation. The fact that implementation of diesel-hybrid system would require additional capital expenditure (not just incremental, as wind is not a continuous source and the seasonal variations are from 0 to 100%) got missed out. The reason for this seems to be the lack of inputs from the wind energy experts at the time of project design.

Management Response: [Added: 2017/12/20]

Noted. The project board which serves as the highest forum and having a strategic role in the project implementations, has always been updated and reported on the project activities and achievement. The project board meeting was conducted at least once a year, for them to endorse the project annual work plan and annual report. When the project started, the project board was also attending the kick-off meeting where the project presented the objectives, outcomes, outputs activities, targets, and success indicators. All the inputs from the board members had been documented in the project board minutes of meetings where it becomes the reference for the project in conducting the activities.

 

The decision to replace the diesel-based power generation in Nusa Penida was based on the recommendation from the coordination meeting between stakeholders, the mid-term review,  and was endorsed by the project board through the project annual work plan. As the power plant is an existing one, the project was only supporting the hybrid power plant to back in operation. There is no additional feasibility study but the investigation report on the component problems. To have a complete assessment on the financial aspect of a hybrid system will require a longer time and more budget, not to mention if the project has to invest in the additional battery system to cover the intermittent issues of the wind power plant. Experts have been involved in the revitalization process of the existing power plant to formulate the most efficient and effective way to do the revitalization activities. 

Key Actions:

Key Action Responsible DueDate Status Comments Documents
The recommendation will be taken as inputs in designing new projects related to wind-hybrid systems.
[Added: 2017/12/20]
Budhi Sayoko 2017/12 Completed
3. Recommendation:

Recommendation 3:

It is recommended that at the time of project design, inputs from the technical experts for the technology being promoted must be taken. As was pointed out in the MTR as well, when it comes to the project goals, the targets were a bit ambitious. This is considering that the timeframe assumed for implementation of the pilot / demonstration projects is very optimistic, as the time required for collection of wind data and doing a realistic wind resource assessment itself takes more than one year.

Management Response: [Added: 2017/12/20]

Agreed. When the project was designed, wind power generation is relatively new in the country. At that time, the country was still lack of experience in wind power plant. Number of investors who interested in developing wind projects was very low. However, in the process of the project implementation, the project was then succeeded in getting attention from potential developers and investors from aboard. The knowledge in developing wind power generation was then improved. The ambitious target was set based on the assumption that the country has a very big potential of wind energy.

Although that the target is not yet achieved by the project, but the pipe line of wind power development is more than the target number. It means that, with a supportive policy and improvement in the grid capacity, the number of wind power generation in the country will meet the target.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
Recommendation will be taken as inputs for designing new projects related to wind power generation.
[Added: 2017/12/20]
Budhi Sayoko 2017/12 Completed
4. Recommendation:

Recommendation 4:

The corrective action for project design is that while putting up a time frame for the demonstration projects a realistic time frame needs to be provided, considering the technology specific project implementation issues and required timelines.

The assumption that it would be possible to create capacities / capabilities to produce wind turbines locally within the implementation period of the project was slightly unrealistic. The important point which got missed out while making this assumption is that the softer part of the technology (design and detailed engineering) of the wind turbines and wind power technology is important and having good engineering facilities within the country alone is not sufficient to enable production of components and parts of wind turbines. The lesson learnt is that while making efforts towards producing high-tech capital equipment in a country, it is necessary to lay equal emphasis on the software (designs, technical know-how and detailed engineering) as well as hardware part (precision manufacturing technology).

 

Management Response: [Added: 2017/12/20]

Noted. The demonstration project was actually not being provided by the project itself, but in collaboration with related stakeholders. In this regard, the time-frame and implementation of the demonstration project is not only depending to the project but also to the project’s partner. The recommendation will be taken as lesson-learnt in designing new project.

Key Actions:

5. Recommendation:

Recommendation 5:

It is recommended that for the project which has a component of developing local technical capacity for production of sophisticated equipment, at the time of project design there should be emphasis on the software part of the technology (know-how, detailed engineering, designs etc.) as well and identification of technology source should be included as one of the activities.

Management Response: [Added: 2017/12/20]

Noted. The recommendation will be taken as lesson-learnt in designing new project.

Key Actions:

6. Recommendation:

Recommendation 6:

It is recommended that while designing the projects having a demonstration component, some fiscal incentives should be provided to such demonstration projects.

The project design has rightly recognized technology gaps and skills as one of the barriers. To address this barrier, the provisions made in the project design were not adequate. The critical part that was missed is the identification of the right and most appropriate technology, its source and the ways to infuse it in the country. Thus, an important technology consideration of the design of rotor blades and the connected generator was not addressed in the project design.

Management Response: [Added: 2017/12/20]

Agreed. To address the financial aspects of wind power projects, the project has involved the fiscal agency from the ministry of finance. However, some of the demonstration projects are existing facilities, and some of them were small scale as local manufactured prototype.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
Any information on fiscal incentives related to wind power generation will be gathered and disseminated to developers and investors.
[Added: 2017/12/20]
Budhi Sayoko 2017/12 Completed
7. Recommendation:

Recommendation7:

For addressing the barriers of technology (particularly in cases where the technology is not locally available), apart from capacity building and training, equal emphasis should be given to technology sourcing and the ways to infuse the technology in the local conditions.

One of the significant achievement of the project has been uptake of ‘large scale grid connected’ wind power projects in Indonesia. This happened due to the support and help provided under the WHyPGen projects in terms of wind resource assessment, identification of potential sites for wind power projects, etc. The technical information created under the project was widely disseminated through the dedicated web site.

Management Response: [Added: 2017/12/20]

Agreed. The WHyPGen website was designed as a one-stop information for all aspect that has relation to wind energy in the country. It was also being used as promotional media for the wind potential to attract more investors.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
The website will be updated based on new information and trend on the wind power sectors, including the recommendation from the final review.
[Added: 2017/12/20]
Herry Desha 2017/12 Completed
8. Recommendation:

Recommendation 8:

In order to continue to get the benefits from the database and useful technical information, it is recommended to continue the availability of information at the website.

From the view point of policy and regulations, one of the issues is that the WHyPGen project has not been able to get approved a feed in tariff policy for wind power projects. Absence of such a policy regarding feed in tariff is one issue which may impact the benefits of the WHyPGen project.

Management Response: [Added: 2017/12/20]

Agreed. The website will be linked to the website of BPPT so when the project is closed, the web can still be available for access.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
BPPT will take over the operation and maintenance of WHyPGen website by moving it to BPPT’s server.
[Added: 2017/12/20]
BPPT 2017/12 Completed
9. Recommendation:

Recommendation 9:

It is recommended that the efforts be continued to get the approval for the feed in tariff for wind power projects. This may be perused by the newly created, Wind Association or any other suitable organisation

Management Response: [Added: 2017/12/20]

Agreed. Supportive policies to the development of wind power generation is required. The association needs to continue the initiation as they are also key-stakeholders in the business.

Key Actions:

Key Action Responsible DueDate Status Comments Documents
Coordination with the association will be conducted for them to continue commercial activities which has been initiated by WHyPGen Project.
[Added: 2017/12/20] [Last Updated: 2019/01/14]
Herry Desha 2018/12 Completed Coordination with relevant association has been conducted to support project achieving targets. History

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