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Maldives

An Overview

The Republic of Maldives is a small island nation located in the Indian Ocean southwest of Sri Lanka. It consists of some 26 major atolls and 1,190 tiny islands lying at the equator (see map below). Of these islands, only 33 have an area greater than one square kilometer. The total land area is less than 300 square kilometer. Maldives is a country with more territorial sea than land. The population is about 300,000 and is highly concentrated on relatively few islands. The atolls are ringed by coral reefs that are the seventh largest in the world and among the richest in terms of species diversity and aesthetic appeal. The reefs host over 1,900 species of fish, 187 coral species, and 350 crustaceans.

There are some 200 inhabited islands scattered across the archipelago, and some 90 additional islands given over to resorts. The populations of inhabited islands vary from a few hundred inhabitants to several thousand. Distances between atolls and inhabited islands are great and transport costs are high, depending on sea and air transport. Male is the location of the country’s major port and international airport (located on an adjacent island: the Hulhule Island).

The Maldives is largely a service-oriented economy. Due to its small population and limited endowments of land, the scope for agriculture and manufacturing is limited. Nature-based tourism is the primary industry, accounting for about 70 percent of GDP (in terms of direct and indirect contributions), followed by fishing and fish processing (about 10 percent of GDP). Revenues from these activities have been channeled largely into public investments in education, health and infrastructure, creating an economy that is graduating to middle-income status. Economic performance has been robust over the past two decades with growth averaging about 7 percent per year reverting to its historical growth path after the post-tsunami contraction in 2005 and the rebound in 2006. Figure below outlines the contribution to growth (Supply).

Nature-based tourism has recently served as the engine of growth and prosperity for the economy. The country has a tourism capacity of about 16,000 beds with an 82 percent occupancy rate. The sector is poised for rapid expansion, with plans for 10 new domestic airports to be managed by the private sector, improvements to existing transport facilities and leases to 51 additional resorts by 2009, which would amount to a 50 percent increase in bed capacity.

Energy Sector Scenario

Maldives has no conventional energy resources (e.g., oil and gas) that it can utilize to meet its energy needs. Basically, the country utilizes imported petroleum fuels to meet all of its energy needs. Bulk of these fuel imports is diesel fuel oil (DFO), which is mainly used for power generation both by the state power utility (STELCO) and close to 1,000 other electricity generators in the outer islands. DFO is also used in seawater desalination (for potable water production) and in steam generation. Petroleum products are also used in land transport (e.g., gasoline, high-speed diesel), including aviation (jet fuel), industries, and households (e.g., kerosene, LPG). Firewood (e.g., dried branches) is also a main cooking fuel in most of the outer islands. Most urban households use LPG and kerosene for cooking. In the outer islands, the main source of energy for domestic purposes has been biomass. Nowadays, more outer island households are now using kerosene and LPG for cooking instead of biomass materials (shrubs and coconut husks). The energy supply mix in the country (excluding biomass, which is not quantified) in 2000 is as follows:

The total commercial energy supply in 2000 was 138,030 million tons of oil equivalents (Mtoe). Diesel fuel oil accounts for bulk of the energy supply in the country (about 85.5%). Gasoline accounts for 6.5%; aviation fuel, 3.9%; kerosene, 3.7%; and LPG, 0.5%.

Maldives Energy Supply Mix (MToe)

Since Maldives is a small nation consisting of 1,190 tiny islands lying at the equator. The number of islands inhabited remains at 200, while another 87 islands are specially developed as tourist resorts. Hence, each island has to have its own electric power generation system and other basic infrastructure. However, regular and continuous electric power supply is available in only 24 of the 200 inhabited islands. These 24 islands have power generation provided by the Government-owned company, The State Electric Company Ltd (STELCO).

Generators operated by Island Development Committees (IDCs), with the financial assistance of the Ministry of Atolls Administration (MAA), serve an additional 50 islands and private providers serve 6 islands with 24 hours of electricity a day. The remaining islands have at least 5 to 12 hours electricity service. The Asian Development Bank (ADB) presently supports an Outer Islands Electrification (OIE) project, which focuses on electrification with 24-hours service community  generators (facilitated by an US$ 8 million loan to the Government of Maldives), on 40 islands. Electricity is typically generated using DFO or Fuel No. 2. STELCO, a wholly state owned company, is regarded as the national power utility. The Maldives Electricity Bureau (MEB), chaired by the Ministry of Trade and Industries (MTI), regulates STELCO and the private power providers.

Data on electricity generation and consumption in the Maldives are limited to that of STELCO power plants, which collectively account for about a little more than a third (34.9%) of the total installed power generation capacity of the country. The total installed power generation capacity in the country is 106.2 MW, bulk of which, are in the resort islands (48.3%). Those in the outer islands operated by the IDCs and some private generators account for 13.2% of the total power generation capacity. The rest are those installed in airports (3.5%).

Maldives imports all its fuels in refined form and in very small quantities, which makes this form of fuel even more expensive. The yearly consumption of fuel is growing rapidly, thus the proportion of hard earned foreign exchange spent on fossil fuels is increasing. Renewable energy is used to power navigational lights (marking the reefs), communication transceivers on fishing boats and for power supply at the remote installations on the national telecommunication network. These installations are not connected to the grid and are privately owned and operated. Solar energy is also used on a small scale for producing hot water for homes and in the tourism industry.

The telecommunication company of Maldives is the single biggest user of renewable electrical energy, which is produced using solar energy. There are 177 sites, mainly using solar power or solar-diesel hybrid systems, in operation. The largest site has a capacity of 3.5 kW while the total capacity approximates 130 kW.

The Government of Maldives is very much aware and concerned about environmental degradation and global warming. These are real threats to small island nations, especially for low-lying islands like those of the Maldives. The Government is very actively taking steps to reduce the emission of greenhouse gases and other environmental pollutants in the Maldives, while concurrent efforts are made to make Maldives greener. Towards this end, the Ministry of Communication, Science and Technology is mandated to explore the feasibility of using renewable energy capable of providing reliable electricity supply to the islands.

The State Electric Company Ltd (STELCO)

The State Electric Company Ltd (STELCO) is, entirely, a state-owned organization responsible for the generation, distribution and supply of electricity to customers throughout the Maldives. Around the nation, it operates in 27 islands, employing approximately 650 employees. Operating from a Head Office in Male', the Company provides electricity and other related services to its customers for the safe and efficient use of electrical energy and to support the economic development of the Republic. STELCO has a proud history of over 50 years of delivering exceptional service to the general public.

Founded in 1949 as the Electricity Department and later known as the Maldives Electricity Board, STELCO has expanded the public electricity supply from modest beginnings to today when it serves a total of around 40,000 customers on Male' and the Outer Islands. However, the company's balance sheet and profits have been adversely affected by rising fuel costs, since 2003.

I. Organizational: Overview

In its organizational structure, STELCO has given special emphasis to customer service through the establishment of a Customer Service Department and also a separate unit responsible for Outer Island regional operations. Its sixteen main business departments are:

1. Power Generation
2. Electrical
3. Customer Services
4. Regional
5. Projects and Planning
6. Information Technology
7. Procurement
8. Finance and Accounts
9. Administration and Human Resources
10. Auditing and Internal Control
11. Villingili
12. Thilafushi
13. Hulhumalé
14. Bill Services
15. Sales Centre
16. Transport and Maintenance
17. Management

STELCO presently employs a total staff of 650 although this has been declining in recent years as the Company improves the efficiency of its operations, replaces older plant and equipment with more modern facilities, thus reducing maintenance, and automates routine processes. Recently, STELCO established a permanent IT Department to further modernize its systems. It also established a Human Resources Department in recognition of the importance of training and retaining competent staff capable of maintaining supply to customers to high standards in the future. The loyalty and commitment of STELCO’s staff is an important ingredient in the Company’s success. Chart below explains the organizational structure of the STELCO.

Organizational structure of the STELCO

II. Generation

STELCO has a modern and efficient diesel power generating plant in Male. In 1949, STELCO started providing electricity with just one generator set with a capacity of 14 kW. Since then the generation capacity has been increased according to the demands of consumers, through various expansion projects. In the outer islands, the company provides electricity using small diesel generating sets and low and medium voltage distribution networks. The total generating capacity both in Male’ and outer islands is approximately 59,134.8kW.

A. Male Powerhouse

The Male powerhouse is the largest generation facility in Maldives. It generates and provides reliable and efficient electric energy to meet the growing demand of Male. The 4.5 MW facility commissioned in 1991 has transformed itself, in the past sixteen years, into a state-of-the-art generation facility with a total capacity of 35,490 KW which now require over 115,000 liters of diesel daily for operation. A 56 member staff team, with engineers, supervisors, and technicians keep the power facility in operating condition at all times. The current generating capacity in Male’ is 35,490kW and at present peak demand in Male’ is 29,328 kW.

B. Other Powerhouse

III. Network Facilities

STELCO has operates high voltage and low voltage underground networks on the island to supply its customers. It also operates a desalination plant for supplying purified water for use in the power station. In the Outer Islands, the Company operates small diesel-electric generating plants and networks of various types for public supply.

IV. STELCO Sale Centre

The STELCO Sales Centre deals in the supply of electrical items to the local market. Namely the items used to install electricity. It is run as a subsidiary to STELCO, the only energy provider to Male and major islands. It sells electrical products from well known brands. This Centre first opened in 2000 under Sales and Marketing Department as STELCO Showroom and in 2006 it has been restructured to run as a separate trading centre with the name “STELCO Sales Centre”. It is located inside the Head Office Building of STELCO.

Renewable Energy Resources

The three potential RE resources in the Maldives are: (1) Solar; (2) Wind; and (3) Biomass. Currently, RET applications are limited to some applications of solar photovoltaic cells in navigation lights and outer island telecommunication systems.

I. Solar and Wind Energy

At present, wind and solar data for resource assessment are only partly available. On solar energy, the only available data from the country’s Department of Meteorology (DMet) are the number of hours of sunshine per day. There are no data available on solar energy radiation. DMet also measures wind speeds at various airports in the country. These wind measurements are at 10 meters above the ground, and because of the low altitude, these are not representative of wind speeds at the higher levels at which turbines are usually positioned. These measurements were taken at 3-hour intervals, and they show average wind speeds varying between 7.2 knots – 11.3 knots. Recent measurements made by the US based National Renewable Energy Laboratories (NREL) have indicated that the largest wind potential in the country is in the islands located between 4.5o and 6o N latitudes.

II. Biomass Resource

The main source of energy for domestic purposes in most of the outer islands has been biomass. Fuel wood is used for cooking and smoking of fish. Biomass includes dry branches from trees and shrubs, coconut husks, dry coconut leaves, coconut shells. However, with the depletion of wood resources and subsequent restrictions on tree cutting, households have switched to kerosene and LPG for cooking instead of biomass materials.

Another source of biomass material is municipal solid waste. According to the Municipality Waste Management Section in Male’, the typical composition of municipal solid waste is: paper and cardboard (33%); kitchen waste (15%), and construction waste (industrial/scraps) (52%). About 15% of the construction waste is wood. Daily solid waste generation in Male’s is on the average 140 tons. Biodegradable waste (mainly food waste) is about 25 tons/day. The solid waste is sorted prior to transporting to the island of Thilafushi. Only the biodegradable and combustible materials (i.e., organic) are dumped in the pits. The combustible materials are burned first before the ashes (plus unburned matter) are dumped into the pit. The landfill area is already 10 years old. Previously it was just a reef and now it has now a reclaimed area of 100,000 m2. Some industries now exist in the area such as a cement packing plant and a LPG refilling plant. Landfill gas from the area can be recovered and utilized for power and heat generation for use by the industries located in the area.