Myanmar has long struggled to provide electric power to its citizens, but a push to electrify the country in the next 15 years under the National Electrification Program has led to the drafting of a plan that pushes the boundaries of realism.
Under the program, the Ministry of Electric Power (MEP) plans to raise the electricity production capacity of Myanmar form 4839.9 megawatts (MW) in 2015 to 23,594 megawatts in 2030, an almost fivefold increase. This ambitious plan is based not on feasible supplies of power, but instead on consumer demand.
Kuronuma Kenji, a representative from the Japanese International Cooperation Agency (JICA) which has worked with MOEP to develop the plan, told Myanmar Business Today, “The Ministry of Electric Power, along with JICA and other organisations, have come to a consensus that Myanmar’s electricity will grow five to eight times in the next few decades. Electricity demand will grow as each consumer will use more electricity.”
While figures have been presented publicly, the MEP has yet to release an official version of the National Electrification Program. According to a presentation to potential energy investors by U Soe Myint, former director general of the Ministry of Energy, Myanmar’s energy mix is due to change significantly in the next decade and a half.
Currently, hydroelectric power accounts for 65 percent of Myanmar’s energy generation, natural gas 33 percent and coal the remaining 2 percent.
By 2030, however, a Ministry of Electric Power’s National Electrification Program aims for hydroelectric power to constitute 38 percent of the total, natural gas 20 percent and coal 33 percent. Renewable energy will also be introduced to the country, amounting to the remaining 9 percent.
Because of the rate of growth of generation in the country, this means that all sectors will at least double, but the largest growth will be in the use of coal.
According to Kenji, “We understand there are several locations in the country where the coal could be produced, but there may be some constraints in both quality and quantity. In order for the country to use coal, they may have to import from other countries.”
According to data from the Department of Geological Survey and Mineral Exploration under the Ministry of Mines, Myanmar has approximately 10 million tonnes of coal. However, the quality is such that it would have to be mixed with imported coal for use in most power plants.
Regardless, 10 million tonnes would not last long under the MOEP’s plan. A 100MW capacity coal plant consumes approximately 55 tonnes of coal per hour, so Myanmar’s planned coal plants could burn through the country’s reserves in short order.
Coal is cheap, currently around $50 per tonne, and many countries in the region are turning to the fuel. Myanmar’s planned use of 33 percent is still lower than the ASEAN average, according to the International Energy Agency.
The cost of importing coal will be offset somewhat by natural gas, already Myanmar’s most profitable export. According to Kenji, “Myanmar has an abundance of natural resources, onshore and offshore. This is geologically true, but has not been confirmed by drilling and exploration. Proven gas reserves are still limited, and within that economically recoverable gas reserves are further limited, according to our understanding.”
Myanmar’s oil and gas extraction is typically undertaken in joint ventures with multinational oil companies, and the vast majority of gas is exported, with only 10-20 percent is kept for use on the domestic market.
“The potential [to use Myanmar’s natural gas supply for power generation] may exist, but we are still facing uncertainty. Flexibility in allocating the sufficient amount of gas for domestic markets may possibly be limited due to long-term contracts. A certain amount of gas should be exported to neighbouring countries for the next 20-30 years, so the constraint for Myanmar is that whenever they need the gas for domestic purposes, they cannot simply increase the amount of production for the domestic reserve,” Kenji said.
Nuclear power has been brought up as an option for Myanmar for over a decade, and in April Myanmar signed an agreement with Russia to develop a nuclear research reactor in the country, but this will be a slow, expensive process, and it will be decades before Myanmar will be able to split its first atom.
Likewise, renewable energy is set to expand, but the cost is the main factor holding it back from sun-soaked Myanmar. Until the country makes plans to invest more in energy, coal, the cheapest option, is due to expand the fastest.
Source: Myanmar Business Today