Abstract
The new Iran Power Report from BMI forecasts that the country will account for
16.3% of Middle East
and Africa (MEA) regional power generation by 2013.
BMI’s MEA power generation estimate for 2008
is 1,178 terawatt hours
(twh), representing an increase of 5.5% over the previous year. We are
forecasting
an increase in regional generation to 1,523twh by 2013,
representing a rise of 29.3% between 2008 and
the end of the period.
Thermal power generation in 2008 is estimated by BMI at 1,100twh, accounting
for 93.4% of the total
electricity supplied in the region. Our forecast
for 2013 is 1,414twh, implying 35.7% growth that reduces
slightly the
market share of thermal generation to 92.8% – thanks in part to
environmental concerns
promoting renewables, hydro-electricity and nuclear
generation. Iran’s thermal generation in 2008 was an
estimated
183twh, or 16.6% of the regional total. By 2013, the country is expected to
account for 15.6%
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
853mn tonnes of oil equivalent (toe) by
2013, representing 19.6% growth over the period since 2008.
Iran’s
estimated 2008 market share of 26.9% is set to ease to 26.2% by 2013.
Iran’s nuclear demand is
forecast to reach 8twh by 2013, with its
share of the MEA nuclear market rising to 32.0%.
Iran is now ranked sixth
in BMI’s updated Power Business Environment rating. This reflects its
market
size and high proportion of renewables (hydropower) 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 pull further away from Iran during
the next few quarters.
BMI is forecasting real GDP growth averaging 3.8%
per annum between 2008-2013, with the 2009
estimate being 2.4%. The
population is expected to expand from 72.2mn to 77.2mn over the period,
with
GDP per capita and electricity consumption per capita forecast to
increase by 38% and 9%, respectively.
The country’s power
consumption is expected to increase from an estimated 182twh in 2008 to
212twh
by the end of the forecast period, providing export potential
rising from an estimated 21twh in 2008 to
36twh in 2013, assuming 4.2%
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
54.1%, which
is near the middle of the range for the MEA region. This
equates to 20.2% in the 2013-2018 period, down
from 22.1% in 2008-2013.
PED growth is set to increase from 16.4% in 2008-2013 to 17.9%,
representing 44.1% for the entire forecast period. The availability of nuclear
power from 2009 is one key
element of generation growth. Thermal power
generation is forecast to rise by 53.3% between 2007 and
2018. More
details of the longer-term BMI power forecasts can be found in the Appendix of
this report.
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