Abstract
The new Iran Power Report from BMI forecasts that the country will account for
17.60% of Middle East
and Africa (MEA) regional power generation by 2013.
BMI’s MEA power generation estimate for 2008
is 1,174 terawatt hours
(TWh), representing an increase of 5.1% over the previous year. We are
forecasting an increase in regional generation to 1,609TWh by 2013,
representing a rise of 44% between
2007 and the end of the period.
Thermal power generation in 2008 is estimated by BMI at 1,096TWh, accounting
for 93.4% of the total
electricity supplied in the region. Our forecast
for 2013 is 1,486TWh, implying 43% growth that reduces
slightly the market
share of thermal generation to 92.4% – thanks in part to environmental
concerns that
should be promoting renewables, hydro-electricity and
nuclear generation. Iran’s thermal generation in
2007 was 173TWh, or
16.64% of the regional total. By 2013, the country is expected to account for
a
virtually unchanged 16.62% of regional thermal generation.
For Iran,
gas was the dominant fuel in 2007, accounting for 55% of primary energy demand
(PED),
followed by oil at 42% and hydro with a 2% share of PED. Regional
energy demand is forecast to reach
902mn tonnes of oil equivalent (toe) by
2013, representing 31.76% growth over the period since 2007.
Iran’s
2007 market share of 26.70% is set to rise to 27.56% by 2013. Iran’s
nuclear demand is forecast to
reach 10TWh by 2013, with its share of the
MEA nuclear market rising to 37.04%.
Iran is still ranked fourth in
BMI’s updated Power Business Environment rating. This reflects largely
its
market size and high proportion of renewables (hydro-power) use. The
power sector isn’t competitive,
with no appreciable progress towards
privatisation. The regulatory environment is unattractive. If South
Africa
can sort out its current power supply problems and make some progress towards
privatisation, then
it may be able to catch Iran during the next few
quarters.
BMI is forecasting real GDP growth averaging 4.74% per annum
between 2007-2013, with the 2008
estimate being 4.90%. The population is
expected to expand from 71.2mn to 77.3mn over the period, with
GDP per
capita and electricity consumption per capita forecast to increase
significantly (by 102% and
25%, respectively). The country’s power
consumption is expected to increase from an estimated 178TWh
in 2007 to
242TWh by the end of the forecast period, providing export potential rising
from an estimated
15TWh in 2007 to 42TWh in 2013, assuming 6.4% annual
growth in electricity generation. Losses during
power transmission and
distribution mean that the actual level of Iranian power exports is well below
the
theoretical surplus, but is set to rise.
Between 2007 and 2018, we
are forecasting an increase in Iranian electricity generation of 82.9%,
which
is towards the lower end of the range for the MEA region. This
equates to 24.9% in the 2013-2018 period,
down from 46.4% in 2007-2013.
PED growth is set to decrease from 35.9% in 2007-2013 to 21.7%,
representing 65.3% for the entire forecast period. An increase of 76.3% in
hydro-power use during 2007-
2018 is one key element of generation growth.
Thermal power generation is forecast to rise by 75.0%
between 2007 and
2018, with nuclear demand increasing from an estimated 2TWh in 2010 to 15TWh
by
2018. More details of the longer-term BMI power forecasts can be found
in the Appendix of this report.
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