Regional Electricity Trade: Some Modeling Results and Reflectons

Power systems continue to get more integrated for over a century as mini grids for small towns and cities eventually covered the entire country, and countries, in turn, got interconnected to start “regional trade”. In this paper, I have assimilated results from a series of studies that I have been part of over the last decade as part of my involvement in Asian Development Bank (ADB) and World Bank projects covering many developing countries. Results from planning analyses at a regional level, i.e., covering interconnected power systems of several countries, typically show annual benefits that are in the order of billions of dollars from cross-border trades. It is however important to analyze benefits at an individual project level including the distribution of such benefits across different scenarios to be able to prioritize projects. It is also important to note that notwithstanding the promise of phenomenally high benefits, regional trade in the developing world is thin with many of those beneficial projects not transpiring in reality, or even if they did, the volume of trade remains low. I have concluded the discussion by recounting some of the key lessons that I learned from my engagements in various projects.