Installed hydroelectric capacity in Myanmar is significant, with the country operating 26 plants, with the capacity to generate 3214 MW of power. Still, hydro-power is not considered a sole solution and questions are being raised about the use of water resources compared with other options. While the whole country could be powered by water alone, it is probable that hydropower will play a reduced, albeit still majority, role in the country’s future energy mix.
Hydropower assets do not perform consistently in Myanmar. In the dry season, they only operate at 30-35% capacity, hence the uneven output needs to be balanced with other sources. Hydropower is also less favoured by some because, among all the alternative energy sources, it can take the longest to develop, with the process taking years rather than months depending on the size of the power station. “A base load of 98% being hydro only really works in Norway at the moment,” Billy Harkin, chairman of Energize Myanmar, told OBG.
Most significantly, while hydropower has a reputation for being clean, its impact on the environment and society, if poorly developed, is highly controversial. It often requires relocation of inhabitants, flooding of agricultural lands and changes to transport routes, not to mention that it can scar the landscape and alter entire ecosystems. However, if done well, as per the approaches undertaken by say Norway and Canada, the benefits can outweigh the impacts.
The largest source of potential water power in the country, the Ayeyarwady River, is vitally important for agriculture and navigation, and is also a major source of fish. As a result of real or perceived disruptive impact associated with hydropower, numerous projects have been halted. The Tamanthi and Shwezaye dams on the Chindwin River were cancelled in 2013, while the 7000-MW Mong Ton dam project on the Thanlwin river remains controversial. Residents and civil society groups are now calling for its suspension until the people affected can be properly engaged. Some 49 hydropower plants were approved by the previous government. Each of these is now being scrutinised by the new leadership.
Nevertheless, Myanmar has had considerable success with hydropower in recent years. Project completions include the Lower Paunglaung dam, in 2005, and the Lower Paunglaung dam, in 2014. Both are near Naypyidaw. The Shweli I Dam, in Shan State, was competed in 2008, while the Yeywa Dam was operational from 2011 – the largest hydropower station in the country, rated at 4×197.5 MW. Meanwhile, the Dapein-I hydropower station was up and running in 2011, and Chibwenge in 2013. Both are at Kachin. Thaukyegat-II, at Bago, has been in operation since 2013 and Shwegyin, also at Bago, since 2011. Kunchaung, at Bago as well and rated at 2×22 MW, has been connected to the grid since 2012. Pyuchaung, located at Magway and with a 2×20-MW configuration, opened in 2015. At Magway, Nancho commenced operations in 2013, Kyeeon Kyeewa in 2012 and Kabaung in 2008, and Baluchaung-3 at Kayah came on-line in 2014.
Myitsone The Keystone
The key hydropower project currently under consideration in Myanmar is the Myitsone dam. In development for more than a decade, it was brought to a halt after the recent round of reforms began. Myitsone’s fate has cast a pall over the subsector, and the risks for bringing it to completion are discouraging financiers from committing to other projects, while tying up resources Myanmar could use for its other fully funded programmes.
China has pushed hard to get the dam completed and operational, arguing that the project will not only help the country meet its power needs, but also secure water resources in Myanmar. China has changed its approach over time, in a way that could help. It has started to recognise its social and environmental responsibility and has acknowledged that it cannot simply show up and spend money without considering the impact of its investments.
The increasing sophistication of Chinese investors has not gone unnoticed. Efforts made the State Power Investment Corporation, the Chinese partner in Myitsone, has been recognised by the Myanmar Centre for Responsible Business. According to the centre, the company has effectively identified and engaged interested parties, even those opposing the dam. The centre has also recognised Myanmar Yangtse Copper (which published a sustainability report on the S&K Mine, part of the Monywa mining complex) and Myanmar Wanbao Company (which published an Environmental and Social Impact Assessment on the controversial Letpadaung copper mine).
Not So Charmed
The charm offensive has not been entirely effective. China’s campaigns are often criticised for inspiring more ire than acceptance. In some cases the research being published to push the Myitsone project has been rejected by local interest groups as unpolished and condescending. Residents question whether the dam would be beneficial to the country and point out that 90% of the electricity will be diverted to China. At the end of 2016, Myitsone remained a subject of resistance, with civil society groups insisting that the project be stopped and local residents sending a petition opposing it.
In August 2016 it was announced that a committee formed by President Htin Kyaw would determine the future of the Myitsone project. It is charged with evaluating the impact of the dam on the environment and the people living in the vicinity. At the end of 2016 the Myanmar Times reported that a committee member indicated the conclusion would be to cancel the Myitsone project altogether. The source told the newspaper that, because the public had resisted the construction of the dam and the agreement was signed under a dictatorship, a consensus had been reached that it would not be right to let it proceed.
It was not clear, however, whether the report on the dam will be made public and who ultimately will make the final decision on the project. The committee has said that it will not publish its findings unless the government approves such a release.
Significant expansion of water power is still possible, if it is done right. Experts are calling for smarter development of hydropower rather than a simple bigger-is-better approach. With the right combination of dams and operational practices, the country can generate the same amount of electricity while causing less environmental damage.
Interested parties are working to promote the power source and ensure development is done properly. In 2016, the IFC and 100 entities involved in hydropower in Myanmar, including private firms, civil society organisations, financial interests and government bodies, formed an association to promote hydropower in Myanmar. The Hydropower Developers’ Working Group, as it is known, is expected to conduct annual meetings and focus on topics such as procurement, documentation, environmental and social impact, permits and licences. The group is being modelled on a similar group founded in Laos in 2013.
Several solar projects are also in development. In 2016 Kamrai Panit, a Thai firm, signed an agreement with Myanmar’s Won Toll to build a 300-MW solar plant in the Ayeyarwady Region. The project is valued at $1bn. ACO Investment Group is committing $480m for two 150-MW plants in the Mandalay region, while Green Earth Power is investing $275m in a 220-MW plant in the Magway region.
Smaller-scale solutions are also being pursued. Sunlabob Renewable Energy, a Laotian company, has been contracted to build 11 micro-grid solar projects in Myanmar. The transport, energy, and infrastructure consultancy ABB Group has also been working to bring solar to the country since early 2015. As of the end of 2016, it had succeeded in bringing power to some 20 villages in the country.
Feasibility studies indicate that Myanmar has significant wind power potential. According to the studies, 10 sites tested in Chin State have total capacity of 1472 MW, another 10 in Rakhine State have a capacity of 1484 MW, five in Ayeyarwady have 478 MW of capacity, and within Yangon Region two sites have a potential capacity of 274 MW.
According to the Asian Development Bank’s “Country Operations Business Plan: Myanmar, 2015-17” report there is a technical potential for the development of 4032 MW of wind energy. However, as wind speeds are inconsistent, there are issues regarding the ability of wind energy to provide a reliable supply.
The best locations for wind power in Myanmar are the hilly areas of Chin State and Shan State, and the coastal regions in the south, west and central parts of the country. Myanmar’s first wind power deal was signed in the early stages of 2016. Under the terms of the memorandum of agreement, the China Three Gorges Corporation will develop a 30-MW wind facility at Chaungtha, in the Ayeyarwady Region.