Myanmar looks to hydropower in new energy plan

As it tries to attract foreign investors into the country, Myanmar looks to overhaul its long-term power strategy by planning to increase the share of hydropower in the country’s energy mix.

The new democratically-elected government of Aung San Suu Kyi has made job creation one of its top priorities for its citizens. But with half of the people without access to electricity and major cities experience blackouts, they find that attracting investors is tough. Also given the current global environmental concerns, getting investors to back coal-fired plants has become tougher.

Myanmar’s initial energy plan was to boost coal’s share by the end of the next decade to a third from just 3% as well as to slash hydropower’s contribution to 38% from 63%, according to the plan shared by the country’s Ministry of Electricity and Energy.

But since most people are reluctant to implement coal-fired power plants, the power plant projects will not push through, according to Aung KoKo, director of hydro and renewable energy planning branch at the ministry.

“Hopefully, hydropower will be the majority in the new plan,” Aung KoKo said, estimating its share at 50-51% by 2030-31. Imports of liquefied natural gas (LNG) could make up for some of the drop in coal use, he added.

Nine key ministries, including energy, industry and mining, have met in the capital of Naypyitaw to coordinate their energy strategy with the aim to have a draft master plan ready by the end of the month.

There are also 49 hydropower projects approved by the previous government that are under scrutiny now. Myanmar is reviewing these to see if they can be completed, how many more would be needed and how to secure funds, as the country seeks to boost its power capacity.

“The new government realizes these projects should be prioritized. She (Suu Kyi) allowed us to talk with potential international lending facilities like the ADB,” a senior official at the department of hydropower implementation of the Ministry of Electricity and Energy said, referring to the Japan and US-led Asia Development Bank.

Several dams and power plants in Myanmar have been financed by China until 2011 and, while the West has since shown eagerness to provide financing for electricity projects in the country in a bid to increase its influence there, experts say shifting away from Beijing will not be easy.

Of the projects under review, some 31 include Chinese investment and involve 11 Chinese companies.Five projects on the list that are sponsored from Myanmar’s budget have faced delays because the country does not have enough money to finance them, the official said. Seven others are being built by local firms. The rest will need to be financed by cooperation with foreign investors.

As of now, power consumption in Myanmar is one of the lowest in the world. Its per capita use averaged 164 kWh (kilowatt hour) in 2013, according to the World Bank, the 11th lowest in the world and roughly on par with Sudan and Togo.