BLOGS

Delays to emergency power projects are not expected to cause major power shortages this hot season, a Yangon Electricity Supply Corporation official says, because COVID-19 has forced many businesses – particularly factories – to temporarily close or scale back operations.

The government announced an emergency power tender last year following severe power shortages in May and June, saying it was necessary to avert more cuts this hot season. The season typically starts in March and ends in late May with the arrival of the first monsoon rains.

Of the five emergency projects tendered last year, the three largest – a 400-megawatt plant at Thaketa, 350MW plant at Thanlyin and 150MW plant at Kyaukphyu – were due to begin producing power on April 3, but are still not operational and appear months away from completion. All three projects will be fuelled by imported liquefied natural gas.

However, U Kyaw Thu, the general manager for electricity distribution at Yangon Electricity Supply Corporation said that he was “confident” there would not be widespread power outages this hot season. 

He said this was because power consumption had been similar to last year – well down on projections for a 10 to 15 percent increase in demand, following the pattern of previous years – and other planned power projects should come online in the next month. 

“Power consumption has not increased much because of the [cooler] weather and the closure of some factories and businesses due to the coronavirus,” he said. 

Ministry of Electricity and Energy data shows daily peak production was around 3,700MW in March, but fell to 3,500MW on April 6, suggesting a decline in demand. This time last year peak production was about 3,500MW to 3,600MW each weekday. The ministry has previously said it expects peak demand to hit 4,531MW in 2020-21.

The impact of COVID-19 on Chinese manufacturing led to a shortage of raw materials for Myanmar’s factories, prompting several to shutter or reduce output in February and March. Although Chinese output has ramped back up and sourcing raw materials is now easier, the spread of COVID-19 to Europe has affected orders of garments, which are Myanmar’s top export item by value at around US$4.6 billion a year. This has meant that factories continue to close, lay off workers or cut their hours.

COVID-19 has also prompted many other businesses to either close or introduce work from home policies, which will likely diminish demand for power over the coming months even further. Although much of the workforce being told to stay at home will lead to a surge in domestic power use – particularly from air conditioners, as temperatures reach 40 Celsius – this unlikely to match the normal output of the factories, office blocks and shopping malls that are closing.

Kyaw Thu from YESC said that three other power projects – a 150MW plant at Ahlone in Yangon Region, a 20MW plant at Kyun Chaung in Magway Region and a 40MW ¬plant at Shwe Daung in Bago Region – should come online “in a few weeks or in a month”, and that this would be enough to meet demand for the rest of the hot season. All three projects are fuelled by domestic natural gas rather than imported fuel.

“Even if it is not the extra 1,000MW we had expected, in the current situation we are confident that we can provide relatively stable power supply this hot season.”

However, the status of the Ahlone, Kyun Chaung and Shwe Daung projects is unclear, particularly given the impact that COVID-19 has had on global movements of equipment and labour in recent months.