Sitesearch

Stakeholders

Navigation

 
 
flag

Democratic Republic of Timor-Leste (2012)

Source: REEEP Policy Database (contributed by SERN for REEEP)

This policy & regulatory overview is not updated anymore since 2015. We decided to keep it online due to high demand but would like to make you aware of the fact that it might be outdated.

Energy sources

Total installed electricity capacity (2008): 50 MW

Total primary energy supply (2007); 126.0 ktoe
Total primary energy production (2008) 0.195 Quadrillion Btu
Total primary energy consumption (2008) 0.005 Quadrillion Btu

The main fuel sources for power generation in East Timor are fossil fuels. The majority of power supply is based on diesel generation. Nevertheless, extensive wood fuel used for cooking is raising deforestation concerns.  It is believed that more than 90% of the energy requirements of East Timor are met by biomass fuels (primarily fuel wood) for cooking and heating applications.

Close Energy sources
 

Reliance

Even though East Timor is an oil exporting country (in 2005 it produced 94,420 bbl/day), the country is heavily dependent on diesel imports for power generation. More than 75% of oil imports are used for electricity production across the country (diesel-generator sets).

There is no oil refinery, and as a result, all refined products including gasoline, jet fuel, diesel and kerosene have to be imported. Most of the oil and petroleum products that are used domestically are imported from Indonesia.

In 2009, Timor-Leste had a total oil production of 96.27 thousand barrel per day, all of which was crude oil, and consumed 1.80 thousand barrel per day. The Net Export/Import of oil was 94.47.

Close Reliance
 

Extend network

The power system in Timor-Leste is small and fragmented, and is mainly based on small and medium diesel power plants. The installed capacity in Dili, the capital, is 19 MW, whilst in the rest of the country; the capacity is roughly 16 MW. Another 10 MW is installed by large consumers as their sole supply or as backup. Diesel is the primary fuel source for power generation. The electrification is overwhelmingly concentrated in urban areas, with the electrification rate being 88% in urban areas and 19% in rural areas.

In 2008, 85% of all power generated was supplied to Dili, and a 24-hour electricity supply only exists in Dili and Baucau, although there is a high rate of outages, particularly in the evening. Installed meters in both cities have in most cases been bypassed, leading to a substantial rate of electricity theft, and a low coverage of cost repayment. Based on figures from the Population Census of 2004, and of connectivity to grid-based electricity supply, it is estimated that in 2008, at least 185,000 households had no access to electricity, except through the use of batteries. The electricity supply of rural Timor-Leste now consists of 58 isolated grids (11 on a district level and 47 on the sub-district or village level), all equipped with diesel generators, but with some being inoperative, due to the lack of maintenance or fuel, or due to vandalism. For lighting, the rural population relies mainly on kerosene, plant oils and batteries.

Close Extend network
 

Capacity concerns

Timor-Leste has been rehabilitating its infrastructure, including its power systems, through financial and technical assistance from donors like the Asian Development Bank (ADB). Plans are also under-way for the expansion of power generation infrastructure, with the proposed installation of an additional 210 MW of new generating capacities, 10 substations, and 600 km of high-voltage transmission lines.

There is a severe power shortage and as a result, blackouts are common in the capital.

The use of fuel wood has increased substantially due to non-availability of cheap kerosene for household use (0.05 cents/litre during the Indonesian occupation versus 0.50 cents/litre afterwards).

Close Capacity concerns
 

Renewable energy

Solar energy
With an average solar insolation throughout the year of 6 kWh/m2/day, East Timor is ideally suited to solar PV applications. Installation of between 10,000 and 50,000 PV systems is likely to be required for households that will not be connected to the national distribution network or microgrids within the next 15 years.  A significant number of small solar power systems were distributed as part of an Indonesian programme during the 1990s, and since 2002, with financial and technical support from various Ministries of Timor Leste, and from numerous NGOs and charities, the number of power systems has increased. Many of those systems show functional failures, with no schemes in place that provide financial and technical capacities for long-term maintenance and spare parts. The possibility of 50W solar home system dissemination has also been proposed, via the UNDP, although no progress has been made in this area currently.

Wind energy
Wind power is a viable option for East Timor, with high coastal wind speeds indicating a good potential for power generation from wind energy. In 2007, a volunteer group from the Australian NGO ATA (Alternative Energy Association) installed two wind power generation systems in the country, for rural electrification purposes. A wind resource map was also produced for the country in 2008 by Portuguese firm MEGAJOULE.

Hydropower
A recent estimate indicates that there is a significant potential for the installation of medium-sized hydropower in the capacity range of 75 to 95 MW (based on feasibility study carried out in six sites by the Norwegian Agency for Development Cooperation). Tmor-Leste started a programme to install hydro power plants with the construction of the Loihuno Power Plant, which was inaugurated in June 2009. This power plant produces 12 kilowatts per day, supplying 140 families. Another hydro power plant is under construction in Ainaro with a capacity of 28 kilowatts per day, sufficient to supply 230 families.

The UNDP (United Nations Development Programme) lacks the further analysis in terms of the suitability and feasibility of small, mini, and micro-hydro power to produce electricity, given the topographic features of the country, to invest in any new hydropower infrastructure.

Biomass energy
The majority of rural energy consumption in East Timor is still provided by traditional biomass fuels, leading to considerable deforestation. However, plans are in place to utilise biomass, along with other renewable energy sources, in the development of renewable power generation capacity in the country. 78 MW of biomass, biogas and waste-to-energy projects are being planned under the government's new energy strategy.

Biogas energy
A feasibility study by the Netherlands Development Organisation (SNV) and Hivos concludes that biogas would be one of the best solutions for cooking and lighting to those households who have sufficient cattle dung available in the yard. While about 12,000 biogas plants are technically feasible based on the sufficiency of manure and availability of water, collection of dung from these animals are rather difficult due to the free grazing practices and the difficulty of accessing water in many places. In addition, as rural households are not in a position to invest on biogas, there is a need to establish micro credit system in place. 

Geothermal energy
Significant geothermal potential has been identified in East Timor, comparable to that of Australia or the United States at the same depth, 10km. The possibility of centralised geothermal power generation has been investigated, although no progress has currently been made in the field.
 

Close Renewable energy
 

Energy efficiency

The per capita electricity consumption (66 kWh) is one of the lowest, not only among its neighbours, but also among the least-developed countries. Energy consumption per capita stands at 56 kgoe, also an exceptionally low figure.

Some energy efficiency projects are currently under-way in the country, including a household energy efficiency demonstration project in Mós Bele, and an incandescent-to-CFL replacement program for the town of Same, capital of Manufahi district. The potential to expand this project was explored, but never realised due to a lack of governmental will.

Close Energy efficiency
 

Ownership

Electricity market
The power systems in Timor-Leste were owned and operated by Indonesia’s national power corporation (PLN) up until 1999. Following the violence and destruction that preceded the departure of the Indonesians, much of the power system, especially outside of Dili, was badly damaged. Most of the PLN technical staff and management departed at this time. All data and consumer records were lost. Following the departure of the Indonesians, the United Nations Transitional Administration for East Timor (UNTAET) set up Electricidade de Timor-Leste (EDTL) from the remnants of the old power system with the assistance of various donors, such as Australia, Japan, Portugal and Norway. However, it was not until June, 2001 that EDTL’s relationship to the East Timor Public Administration was legally defined, and not until August 2001, immediately prior to the end of the UN administration, that EDTL gained the right to charge Dili consumers for electricity. Until then, no customers paid for electricity.

Oil and gas sector
PT Pertamina, the Indonesian state-owned oil and gas company, operates fuel storage and distribution facilities in Timor- Leste, and is the primary supplier of oil, gasoline and petroleum products to the UN mission, the state electricity company, EDTL, and the general public.

Close Ownership
 

Competition

There is no competition in either power generation or energy retail. EDTL is the monopoly supplier and distributor, and is responsible for the supply of electricity to Dili and 11 district capitals, of which only Liquiçá is connected to Dili. EDTL is a state-owned, vertically-integrated organisation.

Electricity tariffs are heavily subsidised. Since the civil unrest in 2006, revenue collection by EDTL has also been low and in 2008 commercial losses measured 50% of all power generated. The normalisation of revenue collection is a high priority for government and EDTL has begun a programme of installing prepayment meters in Dili. The number of metered connections now stands at over 20,000.
 
PT Pertamina has the monopoly on the storage and distribution of petroleum products in the country. Plans are in place to establish an integrated national oil company for Timor-Leste, and are currently in the preliminary stages, with assistance from the Norwegian Agency for Development Co-operation (NORAD), as well as the World Bank.

Close Competition
 

Energy framework

There is no comprehensive national energy policy to guide the development of the overall energy sector, although the current power sector development plan is a move towards this direction.  The government has established four key principles to guide the development of the power sector. The first is that a sound administrative, legal, and regulatory framework for the power industry should be established. The second is that the vast majority of the population should have access to electricity. The third is that imported diesel fuel, currently the main fuel for power generation, should be replaced with domestic sources of energy. The fourth is that consumers should pay for the electricity services that they receive, and that certain groups of consumers may require targeted subsidies.

Renewable energy is a priority in the 2008–2012 Development Plan. A renewable energy assessment for preparation and formulation of energy policy was undertaken by the State Secretariat for Energy Policy (SSEP) in January 2008, and a proposal for renewable energy development in rural areas is being formulated. The SSEP has been undertaking an integrated rural energy development program in various locations since 2005, covering projects of solar power, biogas, mini-hydropower, and efficient cooking stoves. The 2008 SSEP Development Program covers research, maps, and databases on reserves and on potential and renewable energy sources; the establishment of pilot biogas project plants; the reform of EDTL and the reduction of imported fuel dependency; construction and monitoring of the hydro-power plants in Iralalaro and Ainaro; and the promotion of renewable and alternative energy.

The comprehensive study of the country’s renewable power potential identified more than 50 grid-connected renewable energy projects capable of producing 450 MW of capacity. This includes 351 MW of hydropower and 81 MW of potential wind projects. Government is also implementing small-scale initiatives in remote locations including (i) community biogas schemes; (ii) biofuel trials using Jatropha Curcas; (iii) 10-20 kW scale hydropower plants; and (iv) solar home systems.

A special plan for energy development in rural areas has recently been formulated by the UNDP and the government of Timor-Leste.  It features an ambitious program for energy efficiency and renewable energy development.

A Rural Electrification Masterplan is under development with support from the Energy Sector Management Assistance and the Asia Alternative Program respectively, as well as the Trust Fund for Timor-Leste.

The biofuel production was introduced in 2008, with the creation of more than 150 hectares of plantations spread throughout the national territory. The secretariat of State for Energy Policy intends to improve the quality and to expand the production in 2011. As part of the renewable and alternative energies dynamization project, the Government has an agro-energetic plan, which includes two components, the cultivation of oilseed plants and the installation of distilleries, and the pilot projects have started.

Timor-Leste ratified the UN Framework Convention on Climate Change (UNFCCC) on 10 October 2006 and the Kyoto Protocol on 14 October 2008.

Close Energy framework
 

Energy debates

There is a Draft Base Law for Renewable Energies, last reviewed in July 2010, being prepared for presentation to the Council of Ministers, which proposes the creation of a fund for renewable energy development and the mechanisms of its exploitation, and reinforces the importance of human resource training in this area. The law also intends to establish a production limit of 2 kilowatts so that the energy produced by community electrical power plants will only be for the community’s consumption and the excess will be sold to the national network.

Close Energy debates
 

Energy studies

Timor-Leste is not a member of any major regional energy organisations, nor is it a signatory of the UNFCCC. However, some studies have been conducted into the state of energy in the country. YBUL (Yayasan Bina Usaha Lingkungan), an organisation involved in rural energy promotion, as well as renewable energy and CDM activities, conducted a feasibility study into community empowerment through clean energy resources in 2004. Studies have also been conducted by the SSEP to analyse the renewable energy potential of the country.

Close Energy studies
 

Role of government

The Ministry of Natural Resources, Mineral & Energy Policy is responsible for all activities in the energy sector of the country. The SSEP is a subsidiary of the Ministry, as is the National Petroleum Authority (NRA), and the National Council for Energy. The SSEP is responsible for implementing the 2008 development program that promotes the use of renewable and alternative energy sources throughout the country. It undertakes the 2008 development program, which includes databases and studies on renewable energy sources; biogas pilot power plants; thermoelectric plants; hydropower plants, including Iralalaro and Ainaro; and communication (e.g., seminars to promote renewable energy). The NRA was created by a Decree-Law no. 2/2008 in order to establish and supervise compliance with the enacted rules and regulations, covering the exploitation, development, production, transportation and distribution of petroleum and natural gas resources so that the petroleum and gas security of the country is ensured.

The National Regulatory Authority for Petroleum, Natural Gas and Biofuels is designed and expected to take over all duties and responsibilities of the Timor Sea Designated Authority (TSDA) without discontinuity. It will also embrace all regulatory activities currently held by the Ministry of Natural Resources, Minerals & Energy Policy for onshore and offshore exclusive areas.

The Timor Leste Content (TLC) is a mechanism introduced to stimulate the development of local suppliers of goods and services, and the Timorean economy. The Timor-Leste Content Committee (TLCC) is responsible for making recommendations on the use of the resources intended for the development of the Timor-Leste Content, in accordance with the principles of transparency and good governance. The Minister for Natural Resources, Minerals and Energy Policy is responsible for the establishment of the TLCC.

Close Role of government
 

Government agencies

The National Council for Energy is a governmental organisation, consisting of a number of members from the East Timor government, and from civil society. It will have an important role in developing and ensuring the sustainability of energy resources in East Timor. It will also oversee the National Regulatory Authority for Petroleum (NPRA) in much the same way the Joint Commission does with respect to the Joint Petroleum Development Area (JPDA).

HydroTimor is the division responsible for the co-ordination of activities related to the development of hydropower in Timor-Leste. The division is located within the Ministry of Infrastructure, and is responsible for hydrological assessments of the country, as well as the development of the country's hydropower resources.

Close Government agencies
 

Energy procedure

The World Bank has concentrated funds in two projects to improve the supply of electricity, mainly in Dili. The Energy Service Delivery Project (funded by an International Development Association grant of US$2.5 million) will finance the repair of the Comoro power station and the rehabilitation of the power distribution system in Dili. It includes technical assistance for the policy strengthening of the power sector. The second project, the Power Sector Priority Investments Project, seeks to improve the capacity and efficiency of the generation, and distribution of EDTL.

Several pilot programs for solar PV lighting have been initiated. These have involved the installation of solar home systems (SHS) and solar lanterns. The United Nations Development Program and the government of East Timor have both installed SHS. Another UN program, run by the United Nations Department of Economic and Social Affairs (UNDESA) has provided solar lanterns to isolated communities living on the island of Atauro.

In 2008, the first hydroelectric facility was commissioned with an installed capacity of 0.3 MW. The plant is projected to produce 1.5 GWh of electricity annually, and could generate annual savings on diesel demand amounting to US$300,000. A larger hydro project, the Iralalaru Project, with a potential installed capacity of 28 MW, is being promoted. This project has a potential annual electricity generation of 189 GWh, equal to roughly 60% of the total electricity generation of Timor-Leste in 2005.

The Power Sector Development Plan for Timor-Leste aims are that at least 80% of households have access to electricity by 2025.  According to the ADB’s Asian Development Outlook 2009, this target was included in the electrification program announced in mid-2008.

More than half of the US$616 million capital expenditure budgeted for 2009–2012 is to be spent on building power stations fuelled by imported oil, to electrify urban (and later rural) areas. The government has contracted to install 180 MW in generating capacity by the end of 2010, with supporting transmission and distribution lines - a very large increase on the current capacity of 45 MW. The contracts were signed in 2008. A key issue is whether the supply expansion will outstrip demand. A 2004 study found the country needed 50–100 MW of additional capacity by 2025 to lift the electrification rate to 80% from 20%.Another issue is whether electrification should be such a high budget priority. Electricity is a service that can be at least partly self-funded from user charges.

The Strategic Plan (SDP) 2011-2030 was released in July 2011. Energy sector development is prominent in the plan. The SDP envisages that a national power grid will be completed by 2015, linking all district capitals and rural areas. Alternative energy sources including solar, wind, geothermal, and hydro will be constructed in on- and off-grid areas. Key targets include: ensuring that all citizens have access to reliable electricity 24 hours a day by 2015; ensuring a new management mode for the electricity sector will be in place by 2015 based on international best practice; and that at least half of all energy needs will be met by renewable energy source by 2010.

Close Energy procedure
 

Energy regulator

There is no dedicated regulator for the electricity sector in the country. Regulatory functions in the electricity sector are the responsibility of the Ministry of Natural Resources, Minerals and Energy Policy, and in particular the SSEP. Regulatory activities for the petroleum sector are managed by the NPRA, and NRA after 2008.

Close Energy regulator
 

Degree of independence

Both the Ministry and the NPRA are governmental organisations. The Secretary of State for Energy Policy is appointed by the Prime Minister, whilst the President and both Directors of the NPRA are in turn appointed by the Minister for Natural Resources. The Ministerial budget, and therefore the budget of the SSEP, is allocated via the national budget, whilst the NPRA is funded via charges for contracted services, penalties for improper conduct, and the state budget.

Close Degree of independence
 

Regulatory framework

There is currently no regulatory framework for sustainable energy in the country. The Petroleum Act of 2005, which established the NPRA and its functions in the petroleum sector, includes a framework for energy. The country has also enacted the Petroleum Activities Law for the area under Timor-Leste exclusive jurisdiction, and the Petroleum Mining Code in the Joint Petroleum Development Area. There are also the Petroleum Taxation Law (Law N.o 8/2005) and the Petroleum Fund Law (Law N.o 9/2005).

Close Regulatory framework
 

Regulatory roles

The NPRA is responsible for the granting of licenses for exploration and production in Timor-Leste's exclusive jurisdictional zone, as well as overseeing the activities of operators in all divisions of the petroleum sector, ensuring fairness and compliance with government-set standards.

Close Regulatory roles
 

Energy regulation role

The SSEP is responsible for regulation pertaining to the power generation sector in the country, as well as resource assessment studies for alternative energy sources, managing the upgrade of the power sector's infrastructure, and ensuring the competitiveness of government actors in the energy sector.

Close Energy regulation role
 

Regulatory barriers

There is no specific environmental legal framework for electricity projects. At the regulatory level, the government has successfully promulgated the basis for the national electricity system. The emphasis is on the creation of an electricity system that is efficient, integrated, flexible, and economically sustainable. In terms of implementation, important measures did not get beyond the initial recommendations, e.g. the creation of Water and Electricity Regulatory Authority and the drafting of regulations associated with the new policy related with fees and tariffs, as defined in the decree-law 13/2003.

Close Regulatory barriers
 

References

Asian Development Bank (2010) Country Partnership Strategy: Timor-Leste, 2011-2015, Sector Assessment (Summary): Energy. Available at: http://www.adb.org/countries/timor-leste/strategy [Accessed 11th September 2013]

U.S. Energy Information Administration (EIA) (2011) Country Statistics. Available at: http://www.eia.gov/countries/country-data.cfm?fips=TT [Accessed 11th September 2013]

Government of Timor-Leste (2010) Renewable Energies: Timor-Leste invests on Micro Hydropower, News, 24 September 2010. Available at: http://timor-leste.gov.tl/?p=3939&lang=en&lang=en [Accessed 11th September 2013]

SNV (2010) Feasibility of a Domestic Biogas Programme in Timor Leste. Available from: http://www.snvworld.org/en/Documents/Feasibility_of_a_domestic_biogas_programme_in_Timor_Leste_2010.pdf [Accessed 22 November 2011].

World Bank (n.d.) Timor-Leste and Energy, Development Topics. Available at: http://www.worldbank.org/en/country/timor-leste [Accessed 11th September 2013]

Government of Timor-Leste (2010) Renewable Energies: Timor-Leste invests in the ‘Jatropha’ plant cultivation, News, 22 September 2010. Available at: http://timor-leste.gov.tl/?p=3895&lang=en&lang=en [Accessed 11th September 2013]

UNFCCC (2011) Timor-Leste. Available at: http://maindb.unfccc.int/public/country.pl?country=TP [Accessed 11th Septemebr 2013]

Government of Timor-Leste (2008) Decree-Law no 2/2008, National Petroleum Authority. Available at: http://timor-leste.gov.tl/wp-content/uploads/2010/03/DL_2008_2_NATIONAL_PETROLEUM_AUTHORITY_.pdf [Accessed 11th September 2013]

Government of Timor-Leste (n.d.) Oil and Gas. Available from: http://timor-leste.gov.tl/?cat=35&lang=en [Accessed 11th September 2013] Close References