Economic growth in Cambodia is constrained by a lack of appropriate policy for electricity access and energy security. Only 50 per cent of Cambodia’s population had electricity access in 2016. Remarkably, by 2019, the number of households connected to grid electricity grew to almost 80 per cent. The challenge, however, remains for rural areas where certain remote areas have almost no electricity.
Cambodia’s Power Sector Strategy 1999–2016 focuses on household energy security. Its objectives are to provide an adequate supply of energy throughout Cambodia at reasonable prices and to ensure a reliable and secure electricity supply for the expansion of Cambodia’s economy. But this Strategy has had limited success. From March to June 2019, there was a huge shortage of 400 megawatts of electricity during the dry season. This was due to weather conditions, which produced a low water level in a hydropower reservoir. Such a large shortage demonstrates the weak capacity of Electricity of Cambodia (EDC) to manage a vulnerable power supply mix.
Cambodia’s Electricity Law in 2011 has a clear aim of ensuring the protection of the rights of consumers to receive a reliable and adequate supply of electric power at reasonable costs. The Cambodian electricity tariff, however, is the highest among ASEAN members.
Cambodia should have a lower tariff as most of the investment costs in power generation such as coal-fired power plants and hydropower are based on conventional technologies. Countries in the region that have invested in more complex technologies have lower electricity tariffs than Cambodia. It is likely that high prices are a governance issue. Currently, there is public discomfort about the way that EDC manages the supply and price of electricity, especially given frequent blackouts.
Additionally, the security of Cambodia’s oil supply faces risks. Piracy and armed robbery of oil being shipped from the Middle East has played a role in disrupting the free movement of vessels — causing delays, financial losses and loss of life. Cambodia is also affected by tropical weather, with plentiful rainfall which results in floods almost every year. The significant probability of flooding combined with relatively underdeveloped road systems increases the risk of oil supply disruption, especially when oil is transported by truck.
Oil supply in Cambodia is provided by multinational private companies such as Chevron, Total and PTT and Cambodian suppliers like SOKIMEX and Tela. Government regulation stipulates that these companies are to hold 30 days of operational oil stock at terminals. But these companies only hold operational oil stock of about 15–20 days as the country does not have mechanisms in place to monitor these holdings.
The Cambodian government is attempting to reinforce the oil supply resilience of the country. It has been working on improving transport and road infrastructure to diversify modes of oil transportation. It is also improving disaster forecasting systems and emergency schemes for distributing fuel by various transport modes. The development of an oil refinery by Cambodian Petrochemical Company will be completed by 2019 and a domestic oil production project developed by KrisEnergy Ltd will be completed by 2020. Both will likely increase Cambodian energy security in the near future.
So what measures can the government take to address Cambodia’s lack of fuel diversification and a low electrification rate?
The government should first consider households with energy supply that is insufficient to meet their basic needs. Technologies such as rooftop solar photovoltaics, solar farms and standalone small generators can provide fast access to electricity for remote areas in the short term. The government should support investment to connect these areas to the electricity grid in the long term.
Second, the stability and pricing of electricity should be considered. Cambodia may need to establish an institution, such as a national emergency strategy organisation, to deal with energy supply disruption in the future. The Cambodian government may also consider oil stockpiling by the state on top of what oil importing companies hold in their inventory oil stock. This will help protect vulnerable industries such as health, food and electronics during emergencies. It would also be a good signal to investors and it could attract more important investment to Cambodia in sectors that require a stable energy supply such as electronics.
Third, the government should consider the gains that could be made from the efficient generation and usage of electricity. Cambodia could see huge energy savings if new power generators are high efficiency and low emissions models. Besides hard infrastructure, energy efficiency and conservation policies are low-hanging fruit that can save significant amounts of energy at the final stage of consumption, be it in the industry, transportation, commercial or residential sectors.
It is possible to rapidly develop and deploy energy efficiency and saving strategies in all sectors by increasing the share of renewable energy such as solar, wind and biomass power generation in the energy mix. Doing so is essential for the inclusive and sustainable development of Cambodia’s economy.
Hanoi (VNA) – The Ministry of Industry and Trade (MoIT)’s Electricity and Renewable Energy Authority and the Belgian Embassy held a seminar in Hanoi on October 24 discussing renewable energy development.
The event aimed to look into the production and storage of renewable energy, national and internal grids, and the European Union (EU)’s support for sustainable energy development in Vietnam.
Belgian Ambassador to Vietnam Paul Jansen said the event will open up cooperation opportunities for the two countries’ firms in renewable energy field in the near future, adding that the EU and Belgium are ready to share experience with Vietnam and connect businesses together.
Vice Director General of the authority Do Duc Quan said the MoIT has proposed the Prime Minister issue mechanisms to facilitate the development of wind, biogas, solar, and solid waste-fueled power.
Sales and Marketing Director of John Cockerill Group Eric Franssen said Vietnam holds potential for renewable energy development such as waste in industrial parks and biogas heat.
He said the group could assist Vietnam in biogas power production, adding that it is also able to separate hydrogen from water via electrolysis to provide energy for vehicles.
According to him, both sides could also partner in wind power production.
A representative from DEEP C Green Energy Company said there are enough radiation in the north to build solar power plants../.
KUALA LUMPUR, Oct 24 Petronas has been a strong advocate on the use of natural gas in addressing emerging megatrends such as rapid urbanisation, diminishing resources and the rising need for energy.
President and chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin said in its scenario planning for the years up to 2040, the national oil company projected fossil fuel to remain as the main contributor to the energy mix for the next 20 to 30 years.
“We are a strong advocate for natural gas for the very simple reason that it is the cleanest fossil fuel, ” he told Bernama in an interview recently.
He said Petronas’ strong advocacy for natural gas also boosted its role as the world´s third-biggest liquefied natural gas (LNG) supplier and the company is expected to remain among the top five in the future.
Wan Zulkiflee said the company´s LNG supply points are strategically located in Malaysia, Australia and Egypt, and the list will include Canada in 2024.
He said that natural gas is also one of the answers to the sustainability issue — a big agenda in the industry — as it complements new energy sources such as solar power.
“The problem with solar energy is intermittency. Unless you have a very big storage, you cannot ensure a steady supply.
“So, we always believe in this complementary arrangement. If you have solar, you would also need gas. For instance, during the night or on rainy days, there will be more natural gas power generation, ” he said
Going forward, he said Petronas has ventured into the renewable energy space, especially solar and wind power.
“For solar power, we have acquired Singapore-based Amplus Energy Solutions Pte Ltd (M+), with assets in India in April this year, ” he said.
M+ specialises in rooftop and ground-based solar power projects, with a cumulative capacity of over 500 megawatts (MW) — some currently in operation, while others in the midst of development.
It has projects across India, the Middle East and Southeast Asia.
“This is our first venture in solar energy outside of Malaysia. We believe in the long run, this business will grow in terms of renewable energy, ” he said.
As for the wind power business, he said Malaysia lacks the wind speed needed to generate energy, thus the area of business focus would have to be overseas.
“We have just created the business in April this year and are still exploring the opportunities, ” he said.
Additionally, he said Petronas spearheaded the development of the Malaysian Future Energy Landscape 2050 white paper for the government.
Wan Zulkiflee added that Petronas´ involvement in new energy gives it the platform to help shape Malaysia´s energy landscape in line with the government´s target of 20 per cent electricity generation from renewable energy sources by 2025.
Last Saturday, 50 young entrepreneurs and students took part in a global competition to address the urgent issue of climate change.
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Phnom Penh’s Impact Hub played host to the contestants, along with the Delegation of the European Union for a one-day hackathon designed to stimulate the brains of the best and brightest to find innovative solutions to everyday ecological problems.
Last week’s hackathon was part of ‘Climathon’ – a year-round programme that takes place worldwide, initiated by EIT Climate-KIC in a bid to push Europe’s climate diplomacy further, as well as engaging the next generations of entrepreneurs.
The 50 students and entrepreneurs were divided into eight teams – each of which was assigned a mentor from a range of organisations familiar with the issues. Representatives from the EU Delegation, Global Green Growth Institute, EnergyLab and GoGreen Cambodia assisted the Cambodian entrepreneurs who were given 10 hours to tackle one of four issues.
The challenges included very real issues that Cambodia must face, from the reduction of single-use plastics to the need for clean energy, cleaner air and the potential for environmental change via technology.
Over 10 million plastic bags are used in Phnom Penh alone every single day, according to the UN Development Programme.
As Cambodia’s hunt for oil continues, last year renewable energy made up 62 percent of the Kingdom’s installed electricity capacity, although the majority of this came from hydroelectric dams, which many now fear are decimating the ecosystem along the Mekong.
Tackling these timely issues, the winning group included three students from Liger Leadership Academy.
“Liger is all about contextualised learning and the students understanding how they can develop their country, but also where it fits in a global context because climate change is not only significant in Cambodia, it’s significant around the world,” explains Dom Sharpe, country director at Liger Leadership Academy.
“For us we don’t have experts on everything at Liger, so we use the world as our classroom and we need to engage in these opportunities outside of Liger for our students to really compete in an authentic competition to see where their ideas can take them.”
Beating out the other seven groups, the students put forth a plan to create a consulting agency that’s geared towards energy efficiency and data analysis. Their aim to help smaller organisations and businesses find means of saving costs in an environmentally sustainable way impressed the judges, given the context of Cambodia where 97 percent of businesses are small to medium enterprises.
For their efforts, the team was rewarded $500 from the Delegation of the EU and Impact Hub will grant the students a six-month support programme that consists of twice-monthly masterclasses, mentoring sessions and access to Impact Hub’s network of entrepreneurs and investors.
“Where these ideas will lead, in the next six months, that’s a question that no-one can answer, but I think the only thing you can be sure of is that it goes nowhere if nobody tries to do something now. For these students to be involved and have this mentorship, the very least it does is really push them into understanding the real world problem – it’s not a competition they going to try and win it’s a global solution they’re trying to solve,” says Sharpe.
Votey is 24. She has been born into a world, at the beginning of a mass extinction. Three years ago, she trekked through forests to promote eco-tourism communities in Cambodia as a Young Eco-Ambassador, and a member of the UN Youth Advisory Panel. In 2017, she launched Green Lady Cambodia-Vietnam with two friends to introduce washable pads and menstrual cups to reduce plastic sanitary waste in landfills. She says Cambodia “needs more change-makers and risk-takers to boldly kick start their innovative ideas.” We need to listen to people our youth. My generation has failed in its responsibility to protect the planet. It is time we listen to the new generation.
Young people in Cambodia make up 60 per cent of the country’s population. Approximately half of the global population is under 30 years old today. It only makes sense that young people are an integral part of the climate change solution in Cambodia.
The science is crystal clear. Cambodia is one of the most vulnerable countries in the world to climate change. Rising temperature, extreme weather, and unpredictable seasons, is taking its toll on Cambodia’s economy and agriculture. In 2050, Cambodia’s GDP will be almost ten per cent less than planned. Agriculture which comprises one-third of gross domestic product (GDP), is vulnerable as it is mostly rain-fed. For Cambodian workers, rising temperatures is impacting their health and productivity. For young people, school hours in Cambodia have been reduced twice in recent years due to record heatwaves, affecting tens of thousands of students nationwide.
Step 1: Act Now
Young people are telling us that we need to change. Your action matters. The recently launched UN Global Sustainable Development Report 2019 emphasized that personal actions such as making daily lifestyle changes, such as reducing and reusing plastic bags, and consuming less meat, can reduce one’s carbon footprint significantly. Votey told us that for the last two years, she has lived a minimalist lifestyle, shopping mostly second-hand clothes and is challenging herself to let go of unnecessary things. By practicing awareness of her impact on the environment, she “creates space for what really matters in her life.” When young people choose to live sustainably, their families and communities listen.
Step 2: Innovate, Innovate, Innovate
We can no longer continue with business as usual. We need to innovate in Cambodia. Youth solutions, such as Solar for Life and Liter of Light, follow entrepreneurial models that blend goals for economic growth and climate change by creating financial opportunities for communities, while educating – and addressing – larger environmental issues.
Step 3: Step back and let them lead!
Education on climate change is important. Eco-Schools promoted by the Ministry of Environment and Ministry of Education, Youth and Sports is a good start. When climate change is integrated in the curriculum of six Cambodian universities, it creates momentum. But more investments are needed to build capabilities of young Cambodians to respond to the climate crisis. Sharing knowledge and networking will generate leadership and new ideas!
The UN Secretary-General Antonio Guterres during the 2019 Climate Summit said that “And young people – above all, young people – are here providing solutions, insisting on accountability, demanding urgent action. They are right.” To safeguard the future of the planet and of the generations to come, youth themselves need to be part of the solution. The future is now. To fulfil our promise for a peaceful, prosperous, sustainable and inclusive Cambodia, we need to listen to our youth. And they are telling us to act together now. Will you join us?
Cambodia’s economy is growing fast, and so is its demand for energy. Decisions made today regarding sources of fuel and power generation will determine whether or not this ASEAN (Association of Southeast Asian Nations) member country will set itself on a path of sustainable energy and development, or increase its greenhouse gas (GHG) emissions and exacerbate climate change.
Twenty-six bidders submitted proposals to develop a 60 megawatt (MW) solar power project to state-owned Electricite du Cambodge (EDC) in September. The average bid price set a record low for Southeast Asia, which should persuade neighboring governments to embrace auctions, according to the Asian Development Bank (ADB). Thailand private equity company Prime Road Alternative Co. Ltd. reportedly submitted the lowest bid.
“The record low prices show the power of competition,” said ADB office of public-private partnerships director Siddharta Shah in a press release.
This is a new era for renewable energy development in Cambodia and the region, and particularly for solar power generation. This is good news for EDC and the people of Cambodia. We believe more governments in the region will adopt auctions as a strategy to procure renewable energy generation capacity and this structure and tariff will serve as a benchmark for future projects.
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Cambodia: an power sector overview
That said, Cambodia has been slow to embrace solar and renewable energy, as has been the case for ASEAN members generally. In addition to hydroelectric power generation, which accounts for well above half of national power capacity, Cambodia relies heavily on coal and other fossil fuels, increasingly liquid natural gas, for electricity generation and continues to subsidize exploration, production and consumption. Just two solar power plants are up and running in Cambodia at present, one a 10-MW plant developed by Singapore’s Sunseap and another, 60-MW facility in Kampong Speu.
Cambodia consumed a total of 2,650 megawatts of electricity in 2018, an increase of about 15% compared to 2017, according to the Ministry of Mines and Energy. Eighty-three percent of rural areas had access to grid power as of the most recent, publicly disclosed figures, leaving nearly 5 million Cambodians without access to electricity.
Daily blackouts became an increasingly common occurrence in Cambodia and across the Mekong region early this year as the region was affected by the El Niňo weather pattern. The national grid operator by and large has been struggling to keep up with power shortages, fast-growing demand for electricity and the government’s industrialization and economic development agenda, posing a chronic challenge for national development plans.
Industrial Electricity Tariff Cambodia
Province
Electricity Cost
Unit
Phnom Penh
0.21
USD per kWh
Kampong Spue
0.20
USD per kWh
Kandal
0.22
USD per kWh
Kampong Cham
0.26
USD per kWh
Other
0.22
USD per kWh
Data: Emerging Markets Consulting
Searching for alternative options, Cambodia joins a growing list of national governments who have come around to seeing solar and other distributed, emissions-free renewable energy resources as a cost-effective means of achieving national electrification, as well as national and international climate change and renewable energy, goals.
The government should take this lesson learned into consideration and should find other alternative options that will generate less impacts on social and environmental in order to reduce dependency on hydropower.
—Tek Vannara, executive director of the NGO Forum on Cambodia, was quoted in a statement.
Cambodia relies on three main sources for electricity: hydroelectric power plants for more than half, a total maximum capacity of 1,329 MW as of last year, coal power stations of 538 MW, and solar energy of 64.77 MW, according to the ministry.
The government and fledgling, strictly regulated private sector continue to increase their investments in hydroelectric power generation despite warnings from scientists and environmental groups of over-exploitation of these natural resources, particularly in the Mekong River region, due to changing seasonal weather patterns that have increased the variability and lead to drops in output due to drought and other extreme weather. The government also continues to increase its reliance on coal power generation.
Longstanding Premier Samdech Techo Hun Sen in June said the Royal Government has been taking action to address the energy shortage problem. The premier highlighted that the government negotiated the purchase of 1,700 MW of electricity generated by hydroelectric and coal-fired power plants in Laos. He also noted that he requested Japan’s assistance during a recent visit, more specifically by building high-voltage transmission lines that would transport electricity from neighboring Laos to Cambodia.
“Next year, Phnom Penh capital will not face the electricity shortage problem anymore. Phnom Penh needs some 400 megawatts. We will increase the energy generation capacity by coal-fired power plants,” the Premier was quoted in news reports.
Government gradually turns to solar, renewable energy to resolve power shortages, achieve climate change, renewable energy and Sustainable Development Goals
EDC director-general Keo Rattanak said that Cambodia’s energy mix will change dramatically in coming years. “It has been brought up to our attention that power consumption in Cambodia has dramatically increased, mostly driven by construction projects. Therefore, investment in solar parks should go before hydropower, which now dominates domestic power consumption in the country,” he said.
Developments in solar energy are critical in dealing with the power shortage in the country…We will be able to produce at least 20% of our energy from solar systems in the next few years.
—Rattanak said during a forum on energy in Phnom Penh in July organized by the American Chamber of Commerce.
Solar and Cambodia’s National Strategic Development Plan
The Cambodian Cabinet approved four energy projects this past April, a US$231 million hydroelectric power and three solar power projects with a combined, rated, maximum power capacity of 140 MW. The latter are expected to come online and dispatch power to the national grid by 2020 and 2021 in four different provinces.
Some 347 households and farmland will be displaced and 5,355 hectares of farmland owned by 296 families will be taken over by the government as a result of building the Pursat hydroelectric power plant. In addition, 600,724 hectares of forest will be submerged or otherwise affected, according to Mines and Energy Minister Suy Sem.
The Pursat dam and hydroelectric power will be able to produce up to 70% of its total capacity during the dry season, however, Suy Sem highlighted. “It’s different from other projects because other projects can only produce 30 percent during the dry season, or even less, such as this year, for example,” Senate secretary-general Oum Sarith added.
Cambodia energy services provider SPHP is to develop the US$58 million, 80-MW Stung Pursat I solar power project in Pramoy commune under a 39-year, build-operate-transfer model. Two other 60-MW solar power plants are to be built in Pursat Province’s Krakor district and in Kampong Chhnang province’s Tek Phos district by jointly owned Canadian-Cambodian project developer Schnei Tec Renewable Co. Ltd. as per a 20-year build-own-model. In addition, cabinet ministers approved Schnei Tec’s proposal to increase the 60-MW solar power plant the company is building in Kampong Speu’s Oudong District by 20 MW.
Cambodia’s recent solar power tender is the first of a two-phase auction process that falls under development of a plan to build a 100-MW National Solar Park in Kampong Chhnang province. ADB’s Office of Public-Private Partnership is serving as a transaction adviser and assisting EDC to design and conduct an open and competitive bidding process, according to the multilateral development bank.
ADB’s financing package includes a US$11-million loan and a US $3-million grant from the World Bank administered Strategic Climate Fund, more specifically via its Scaling Up Renewable Energy Program.
ADB is supporting Cambodia’s efforts to expand, strengthen and modernize the state utility grid in additional ways. These include helping craft the development plan, as well as assisting with implementation of innovative clean energy technology, such as energy storage systems. The ADB acted as transaction adviser on the tender. The governments of Canada and Singapore helped with project preparation work.
China’s JinkoSolar, the world’s leading solar module manufacturer, is supplying the photovoltaic (PV) panels and other equipment for the Schnei Tec solar project. “The 60-MW solar installation is just the first step towards an abundant and vibrant renewable energy future in Cambodia. We have great expectations for the entire region,” global sales and marketing vice-president Gener Miao was quoted as saying. “The region’s booming populations, strong economic growth engines and abundant sunlight represent an exciting opportunity for solar power and for JinkoSolar.”
Taking a public-private partnership, with heavy emphasis on private sector capital
Cambodia is taking a public-private partnership approach to raising the capital needed to carry out its latest strategic development plan. The private sector will need to contribute no less than 75%, some US$43.4 billion. The government will contribute US$14.3 billion in order to fully fund the National Strategic Development plan.
Senator Sarith said that the 2019–2023 National Strategic Development Plan focuses on fostering inclusive growth and achieving UN Sustainable Development Goals—doing so would also help Cambodia make the transition from a lower-middle-income country to an upper-middle-income country come 2030.
Solar roof in Siem Reap Province, Cambodia. Photo: Flickr @Kalleboo
“This strategic development plan plays an important role in implementing the government’s priority policy, which is stated in the Rectangular Strategy-Phase IV and the Sustainable Development Goals of 2016–2030,” he was quoted as saying.
“In the accumulation with the existing 10-MW project in Svay Rieng province and 80-MW of solar plant in Kampong Speu and a plan to construct a 120-MW in Kampong Chhnang and Pursat which have been approved, I think it is possible,” Vannara said.
Expanding solar generation is aligned with the country’s goal of increasing access to affordable and reliable sources of electricity.
—ADB principal climate change specialist Pradeep Tharakan said.
Solar at Cambodia’s water-food-energy nexus
Rice cultivation and exports are the principal crop and source of agricultural sector revenues and employment in Cambodia, accounting for more than 20% of employment among the working-age population, according to the International Finance Corp. (IFC), which is also working to foster deployment of solar and renewable energy in Cambodia.
Aligned with achieving sustainable agriculture, energy and general improvement in livelihoods and living conditions, Cambodian Rice Federation (CRF) secretary-general Moul Sarith reportedly said that increasing solar power generation would help reduce electricity costs and boost the Kingdom’s exports. “I think it is good for the rice industry as production costs will be lower and this will provide us with greater potential to compete with other countries,” he was quoted in a July news report.
Private sector agricultural interests are calling electricity prices to be dialed down to between 400 and 500 riel per kWh (US$0.097–0.12). CRF member rice millers on average reportedly pay on average between riel 50,000 (US$12.18) and 150,000 (US$36.54) per month for electricity.
“We want to set up solar power plants in many locations. We believe solar power will provide lower prices. As EDC’s director, I do not want to see the Mekong River as part of the hydropower generation,” Rattanak said.
“Having reliable, sustainable, and affordable energy sources is crucial for the economic development of a rapidly expanding country such as Cambodia,” ADB’s Tharakan concluded. “ADB’s assistance will not only help diversify Cambodia’s energy mix through solar power development, but also help the country meet its greenhouse gas emissions reductions target, as per the Paris climate agreement.”
Katie Patterson of Myanmar Energy Monitor talks to The Myanmar Times about the impact of Myanmar’s electricity tariff hikes, next year’s blackout risks, the potential of renewables and the sector’s investment prospects
The Myanmar government has put in place the National Electrification Plan to achieve 100 percent electrification by 2030, but implementation is behind schedule, putting the country at risk of a potential energy crisis.
Electricity generation was 600 megawatts short of demand during this year’s hot season. As of now, there are 83 power plants in Myanmar, including 62 hydropower stations, 20 gas power plants, and one coal plant.
The current generation capacity is around 3.6 gigawatts.
In an interview, Ms Patterson, editor of FMR Research & Advisory’s Myanmar Energy Monitor, said that the electricity tariff hike has led to an uptake in solar power and that renewables should play a bigger role in the country’s energy mix.
The government estimates that power demand is growing by 15-17 percent every year. To catch up with this demand – and provide the additional 12.6 GW of electricity by 2030 – at least US$2 billion per year of investments are needed. This requires the right kind of energy developed in a responsible way, taking into account environmental and social impacts, land legacies and desire of ethnic groups for revenue sharing in areas where the natural resources are located.
Under the current administration, very few energy proposals have materialised into contracts so far.
The ministry in June issued five expensive emergency-power project tenders to prevent repeating blackouts in Yangon next year.
How does the hike change the investment prospects of the energy sector?
The hikes should free up more funding to invest in new projects by reducing what the MOEE has to spend subsidising people’s electricity. Recently the Electric Power Generation Enterprise (EPGE) said that it expects to generate K6.9 trillion in revenues this fiscal year, up from K6 trillion in the last year, thanks in part to the tariff hike.
For a long time, the failure to raise tariffs has been blamed for the worsening state of power generation in the country.
Power Purchase Agreement (PPA) negotiations for a number of larger power projects have stalled because the government has said that the price is too high. Hopefully, now the government will feel it has the financial means to fund these projects, though we still haven’t seen any contracts inked in the past few months.
Also as a result of the tariff increase, off-grid solutions have now become more competitive, opening up space for more projects in this area. Off-grid solutions, which are often renewables, had been struggling to gain traction because the price of installation made them too expensive compared to the grid. Now, these solutions are more economically viable.
Since the tariff hike, we have also seen an increase in the number of solar rooftop panels purchased by companies and, especially manufacturers, seeking to bring their monthly bills back down.
This move also has symbolic importance for investors thinking of becoming more involved in Myanmar’s power sector.
It tells businesses that the MoEE wants to work with the private sector on electrification and that it’s willing to make necessary reforms, even when they may be unpopular in the short term. When the hike was first announced, many businesses reacted positively, even as it meant their electricity bill would go up.
What reform programmes, new legislation or changes in regulations are happening in the energy sector?
We haven’t had any major energy-specific reforms as of late, other than the petroleum bill, and the pace at which any significant pieces of legislation will be approved and implemented is likely to slow considerably next year, with the elections coming closer.
In terms of power and electrification, there have been talks of a new master plan being drafted, as the last one approved by Parliament in 2015 prioritises coal and has faced fierce public backlash. However, nothing has come out to suggest that this plan will be revealed any time soon.
Around this time last year, the MOEE also said it was in the process of drafting a law related to renewables, but there hasn’t been any major news on this since.
Now that there are five emergency power projects, what will be the supply-demand gap in Myanmar and how bad will the outage be next year?
We expect the supply-demand gap in Myanmar to continue to worsen. Unless something drastic happens, power outages will be worse next year and in 2021.
Because the majority of our power comes from hydro facilities, we experience generation gaps during the summer, when a lack of rainfall depletes dams at the same time demand spikes. Last summer the gap was estimated at around 600MW, and it will only grow as more households are added to the grid but no new plants come online.
The emergency power projects are an act of desperation from MOEE. These projects are expected to be highly expensive, but the reality is that there is an election next year, and consumers will be extremely unhappy if find themselves paying even more for electricity when the blackouts are worse.
If the government can successfully negotiate PPAs for all 1040MW of emergency power, it will certainly help bridge the gap, but sceptics are wondering if they will really come through. We will be watching the situation closely to see how they come to fruition and what the size of the contracts will be.
What role is renewable energy – including solar and hydropower – expected to play in the electrification plan?
The role of renewable energy in Myanmar’s electrification plan will hopefully grow. The country has abundant resources, especially when it comes to hydro and solar power.
Under the current Energy Master Plan, however, renewables besides hydro will make up a very small portion of generation capacity, around 10pc, while coal will jump from 3pc to 33pc of total capacity. In reality, it’s unlikely that this plan will be implemented, mainly due to widespread public opposition to coal.
Hydro already makes up the bulk of the country’s generation capacity – around 62pc – and there is significant potential for more hydro facilities to be developed. Construction is moving along slowly on several existing projects at the moment, and a few others are in the works, but the PPAs have yet to be inked.
In some cases, we’ve also seen companies approaching regional governments about small-scale projects under 30MW.
Myanmar holds a huge amount of power in its waterways, with some estimates of the potential for additional capacity going as high as 100GW. We can be confident that hydropower will continue to play a significant role in Myanmar’s energy mix.
As for solar and wind, companies have definitely expressed interest. Just last week Yoma Strategic Holding announced a strategic partnership with the Philippines’ AC Energy to add around 200MW in utility-scale capacity from renewables to the grid. InfraCapital Myanmar is also attempting to negotiate a PPA for a 263MW wind project.
However, a lack of experience with these types of power has made the government hesitant to move forward with any large-scale projects. The Minbu solar facility in Magway has moved forward, with phase 1 coming online in June this year, but the project has faced significant delays.
The other major solar project being developed by ACO Investment Group seems to have completely stalled. Also, no large-scale solar projects have received a PPA under the NLD government, with the price being the key area of dispute.
MoEE representatives have also suggested that the grid cannot handle the fluctuations that come with solar power, despite external assessors disagreeing.
As for wind, the outcome of InfraCaptial’s negotiations will play a major role in determining future potential. This process is likely to move slowly, though, as they’re creating all of the agreements from scratch and doing a fair bit of educating about the logistics of wind power.
Jayapura, Papua (ANTARA) – State-owned electricity firm PLN hope to supply electricity to 1,123 villages in Papua and West Papua Provinces by the end of 2019, PLN General Manager for the Papua and West Papua regions Ari Dartomo said. Power will be supplied to these villages through hydropower plants, electric tubes, biomass power plants, and solar power plants, he told journalists in Jayapura, the capital city of Papua Province, Tuesday.
The total number of villagers who would be served by PLN’s electrification program could have been validated thanks to its recent Lighting Papua Expedition Program, he said. The electrification ratio of Papua and West Papua Provinces had so far reached 95.75 percent, he added.
Some 58.25 percent of the electrification ratio was filled by PLN while the remaining was distributed by the Solar Energy Lamp Program (LTSHE) of the Energy and the Mineral Resources Ministry, and the initiatives of the regional administrations.
The electrification program would soon be conducted in the villages of Sarmi District.
The central government has outlined an ambitious target to achieve a milestone in the power sector, with 100 percent electrification in Indonesia by 2020, former Energy and Mineral Resources Minister Ignasius Jonan had revealed in September.
“Until August, (the electrification ratio) had reached 98.9 percent completion. With a monthly increase of some 0.1 percent, the target of 100 percent can be achieved by 2020,” Jonan remarked after attending the 62nd anniversary of Padjajaran University.
The electrification ratio was projected to reach 99.3 percent completion by 2019-end, Jonan affirmed.
Jonan pointed to the fact that some 500 thousand households applied for new power connections annually. (INE)
