Myanmar considers coal to boost generating capacity

In 2010, a total of 11 coal-fired plant deals were signed by the Ministry of Electric Power. However, due to opposition for a variety of reasons, very little capacity has been built. From an economic standpoint, there is the position that the country is so in need of electricity that it must make compromises and accept a certain level of pollution and population displacement to close the gap. Nonetheless, the calculation is a delicate one, and the authorities are going to have to be careful in the compromises that are made. While the country no doubt needs more power, the level of public engagement now is such that it will not be easy to pile on the plants so quickly without dealing with questions about the coal plants and whether they are necessary.

Power Up

The country has an estimated 11trn cu ft of gas reserves, with a dozen gas-fired plants in the pipeline to produce a total of 1.26 GW, and an additional 2.71 GW worth of plants in the planning stages. However, coal is seen as a more viable alternative as it can add greater capacity at a faster rate. At present, the country only has two coal-fired plants, with a total generating capacity of 128 MW. However, a total of 10.09 GW of additional capacity has been agreed upon between the government and developers, while another 8.71 GW is in the planning stages, according to Interfax. To reach its goal of 100% electrification, Myanmar is going to have to follow through on many of the planned coal projects.

Coal, however, remains controversial. Residents affected, as well as interested international parties, have been challenging many of the projects. In early May 2015, an estimated 600 villagers near the town of Ye in Mon State protested plans by Thailand’s Toyo-Thai to build two 640-MW coal-fired plants in the area, for a total investment of $2.8bn. Local residents led by civil society groups and monks said that the process had not been transparent and that some land had been acquired unfairly. A month later, residents of Kyaukpyu Township in Rakhine State sent a letter of protest to challenge the building of a 1320-MW plant by Daewoo. The chief minister of the state said that he would halt the $2.5bn project if it received enough opposition.

A Mixed Bag

The international community is calling for a balance, with the Asian Development Bank saying that while coal is an important part of the energy mix in the region, the best technology should be utilised to reduce the impact on the environment. Officials from Japan International Cooperation Agency have stated publicly that Myanmar needs to be open to coal, while the World Bank does not rule out the burning of coal. It acknowledges the reality that to meet the growing demand, a significant amount of coal will have to be used.

Myanmar has very little of its own coal, and what it has is considered low quality. The country therefore plans to buy the fuel off the international markets. While this will not be hard, given the abundance of low-cost coal and the strategic position of Myanmar on international coal routes, utilising the resource will require building significant port infrastructure.

The Renewable Energy Association Myanmar argues that the use of coal violates the country’s National Energy Policy. According to the group, Myanmar is obligated to source energy locally and develop a sustainable plan. However, coal must be imported and will always have to be brought in from elsewhere. The group also objects that electricity from some of these plants will be exported. As of early 2015, the plants were officially on hold as the government took into account the arguments being made, while it also put forward its case for the benefits of coal power. In late 2015, press reports indicated that the government had stopped meeting with developers altogether.

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The Report: Myanmar 2016

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