Support for Asia EDGE

The Asia Enhancing Development and Growth through Energy (Asia EDGE) initiative is a U.S. whole-of-government effort to grow sustainable and secure energy markets throughout the Indo-Pacific. As a United States Agency for International Development (USAID) implementing partner, NARUC supported the following Asia EDGE goals:

• Utility modernization – promoting access to affordable and reliable energy through advancing the financial viability and efficiency of electric and gas utilities
• Increased deployment of energy technologies – adopting least-cost, long-term planning, and efficient integration of transformative technologies
• Transparent, best value procurement – setting transparent and competitive procurement practices to enable private sector participation
• Regional energy trade and integration – developing a domestic energy market and cross-border trade regulatory framework

 

Our Work

Under the auspices of USAID/RDMA and in support of Asia EDGE, NARUC, together with the U.S. Energy Association (USEA), was engaged in the Asia Gas Partnership (AGP) Program, which is a public-private partnership involving government and industry representatives from the U.S. and Indo-Pacific countries. Through the AGP, NARUC partnered with energy regulators and ministries in Bangladesh, Indonesia, the Philippines, Sri Lanka, Thailand, Vietnam, and Papua New Guinea (as an observer) to 1) establish and enhance midstream and downstream natural gas markets, and 2) meet respective national energy policy goals by helping to create stable regulatory environments that attract increased private investment and economic engagement in the energy sector.

Developing downstream natural gas markets and ensuring efficient, timely build-out of required infrastructure requires effective legal and regulatory frameworks to be established. With this in mind, NARUC’s support was intended to help provide regulatory structure and clarity to support the Indo-Pacific region’s growing commercial growth in the natural gas sector.

 

Focus Areas and Selected Engagements

The Roadmap to Downstream Natural Gas Markets

In 2020, NARUC published The Roadmap to Downstream Natural Gas Markets and a corresponding infographic tool, both of which serve as resources outlining essential foundational regulatory steps for regional regulators and relevant ministries to establish robust downstream gas markets. The Roadmap is not meant to be a one-size-fits-all approach, but rather a resource that provides steps for consideration in establishing robust downstream natural gas markets based on historical progress and current practices in the United States. Its contents outline the following:

• The key foundational tenets governing the structure of well-functioning, competitive downstream natural gas sectors as exhibited through best practices gleaned from the establishment of liberalized natural gas sector and market reforms in the United States
• Recommended key regulatory steps, provisions, and considerations necessary to establish diversified and competitive downstream gas sectors in countries integrating imported liquefied natural gas (LNG) resources

NARUC presented the Roadmap to partners, utilizing NARUC experts to detail the responsibilities of the regulator to work with utilities to oversee system planning and the ways in which natural gas networks can help facilitate renewable energy integration.

Natural Gas Regulation in Thailand

As the fastest growing global energy resource for decades, natural gas has become a commodity of great interest to Thailand due to its high conversion efficiency for power generation, as well as its cleaner greenhouse gas emissions profile relative to other fuel sources (such as coal and oil). LNG has become a principal method by which natural gas is brought to Thailand to satisfy market demand for use as an efficient generation fuel and as a bridge fuel to complement renewable power generation.

In 2020, natural gas regulatory experts from NARUC conducted a peer review of a selection of Thailand’s regulatory documents related to natural gas, including those on the subject of Third Party Access (TPA) and Transmission System Operators (TSO). TPA rules govern increased access to natural gas transmission networks in a fair and transparent way that fosters competition, while TSO rules promote and ensure security of supply, efficiency, consumer protection, safety and reliability of the system, and reasonable consumer prices. They also allow various gas suppliers to reserve gas pipeline capacities and enter the gas market. This support via the AGP helped to provide an informative reference and constructive suggestions for Thai energy regulators to consider in hopes of ongoing improvements in its domestic regulation of natural gas markets.

Natural Gas Regulation in Vietnam

Vietnam has established and operated a natural gas sector for decades. Currently, continuous power demand growth requires increased domestic power production. As such, Vietnam is in the process of developing multifaceted natural gas strategies that are driven by increasing reliance on natural gas to power generation to accommodate demand growth. Vietnam has outlined these strategies in its Gas Master Plan (GMP), which identifies anticipated power demand and its national gas strategy.

In 2020, natural gas regulatory experts from NARUC conducted a peer review of the GMP to examine technical, policy, or economic components. The peer review served to identify technical and policy areas that require further elaboration on specific gas sector planning projections to allow interested commercial gas sector participants to operate with full awareness regarding Vietnam’s policy objectives and regulatory landscape. These recommendations will help inform Vietnam’s gas regulators as the country updates its General Energy Master Plan, thereby providing a more comprehensive natural gas development strategy as well as an improved environment for markets and international investors.

Understanding Small-scale LNG Shipping

As global energy resources trend toward new fuels and generation technologies, Asia’s interest in the use of natural gas has been growing rapidly, with the region leading the global growth in demand for the commodity. Using natural gas for industrial production and power generation needs is helping many Asian countries achieve ambitious policy goals such as lower emissions, improved air pollution levels, bridge fuel requirements, greater power reliability, and cheaper electricity prices for millions of consumers.

In 2020, NARUC conducted a webinar titled Small-Scale LNG Shipping as a means of offering cutting-edge insights on the latest developments on the subject, which is an attractive option for numerous countries in the region that are interested in increasing the use of natural gas in their energy mix. The webinar focused primarily on technologically innovative LNG shipping, receiving, processing, and storage infrastructure options currently available among global engineering and construction firms serving the LNG industry.

A Q&A portion gave participants opportunities to raise questions related to LNG infrastructure regulations, LNG transport safety standards, prospects of small-scale LNG production, price competitiveness of LNG to other fuels, and local natural gas market structures. Participants from around the region gained a better understanding of the role of regulators in LNG and natural gas markets, the role of LNG in island states, and shipping technologies for LNG transport.

 

Related Publications and News

• The Roadmap to Downstream Natural Gas Markets

• Developing Natural Gas Infrastructure and Markets

• NARUC's Asia Gas Partnership from 9,000 Miles Away

 

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