Upgrades planned for Yangon power grid

Poor electricity supply invariably appears prominently in discussions about the challenges facing Myanmar’s economy. Accordingly, international organisations and in some cases foreign investors have pledged large amounts of money and expertise to tackle the problem.

However, the discussion is normally framed in the context of expanding power generation capacity rather than the urgent need to repair existing infrastructure. Nowhere is this more apparent than Yangon, where 76 percent of households have electricity – well above the national average of 25pc – and consumption is about 850 megawatts, or half of the national total.

In some areas, Yangon’s electricity infrastructure dates back to the colonial period. In addition to new generation capacity and a rollout of the network to the other 75pc of homes who are not yet connected to the national grid, experts say extensive investment is needed to bring the city’s distribution system up to standard.

The Ministry of Electric Power is already undertaking some measures to rehabilitate the distribution network. In early February, a pilot project was launched in Thaketa, Dawbon and Dagon Seikkan townships with the help of the Japanese International Cooperation Agency (JICA). The project aims to reduce blackout periods by installing a system that allows engineers to identify fault location points in distribution lines within seconds.

A pilot survey of the city’s electricity distribution system, also being conducted in conjunction with JICA, was launched in July 2013, with aims to expand if successful. “Overall we found … power demand is growing, generation capacity is increasing but distribution network and capacity of power stations are not up to date,” said Kuronuma Kenji from the electricity section of JICA’s Myanmar office.

A major impact of the outdated infrastructure is losses during the transmission and distribution processes. Overall power loss in Myanmar is said to be 26pc, of which 5-10pc is during transmission and the rest from distribution and illegal electricity use. “This means that when power generation increases, more and more power will be lost unless the transmission and distribution systems are upgraded,” he said.

Yangon City Electricity Supply Board (YESB), the government body responsible for electricity distribution in the city, also started installing digital meters last year in an effort to charge customers more accurately and combat thieves. The system is also more efficient and cut down on cheats, reducing power losses from more than 20pc to 17pc, said U Yan Lin, the board’s chief engineer.

However, its efforts to roll out the digital meters, which are produced by army-owned Union of Myanmar Economic Holdings Limited (UMEHL), have been hamstrung by a lack of funding.

“We don’t have enough money,” U Yan Lin said. “We just buy the meters and repay [UMEHL] whenever we have some cash.”

Although large-scale generating projects take years to develop, improvements to the transmission and distribution networks can often be improved incrementally.

Over the next six years the Ministry of Electric Power will spend US$214 million – borrowed from JICA – to reduce electricity losses due to transmission and distribution down to 5pc.

The first phase of the project will include 25 townships. The ministry is also in discussions with Thailand’s National Institute of Development Administration (NIDA) to borrow 3 billion baht for a similar project in North Dagon and North Okkalapa townships.

Other international organisations are also involved in rehabilitating Yangon’s electricity network. The Asian Development Bank will work in five townships, it said last year, while the International Finance Corporation (IFC), a member of the World Bank Group, has signed an agreement with the Ministry of Electric Power to improve power supply.

The IFC will provide technical assistance to reform YESB so it can provide electricity reliably and efficiently, while the government has committed to enabling YESB to operate as a stand-alone and regulated electricity supplier within three years.

As a whole, the World Bank Group plans to provide $1 billion in financial support to expand electricity generation, transmission and distribution, but most of the attention remains on power generation. Mr Kuronuma said outdated infrastructure, including substations and transformers, will limit the benefits of those power generation projects.

“Getting the right balance of investment in generation, transmission and distribution is critical,” he said.

Source Myanmar Times

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