Analysis Of Emerging Opportunities In Myanmar’s Electricity Industry - Subha Krishnan

Subha Krishnan, Research Analyst

Energy & Power

12th July, 2013

Analysis of Emerging Opportunities in Analysis of Emerging Opportunities in Myanmar’s Electricity IndustryMyanmar’s Electricity Industry

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12th July, 2013

Focus Points

• Myanmar’s Electricity Industry: Overview

• Structure of Myanmar’s Electricity Industry

• Major Challenges & Drivers faced by Myanmar’s Electricity Industry

• Myanmar’s Power Development Plan

• The Power Generation Market in Myanmar—Centralized Power—Installed Capacity by Fuel Type & Installed Capacity Forecast

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• The Power Transmission and Distribution Market in Myanmar—Existing& Planned Transmission and Distribution Capacity

• Opportunity Assessment—Power Generation and T&D Equipment

• Conclusion: Key Takeaways

Myanmar’s Electricity Industry – Overview

• Myanmar’s installed power capacity, which was 3,321.9 megawatts (MW) in 2012, and isexpected to rise to 6,553.9 MW by 2021. Currently, the country has 29 power stations (18hydropower, 1 coal-fired, and 10 gas-fired stations) that supply electricity nationwide.

• A total of 1,376.0 MW from coal-fired power plants, 600.0 MW from gas-fired powerplants, and 1,256.0 MW from hydropower plants are expected to be developed between2013 and 2021.

• Myanmar’s electricity demand is estimated to be close to 1,850 MW during the summer

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• Myanmar’s electricity demand is estimated to be close to 1,850 MW during the summermonths, but the hydroelectric power plants that provide close to 70% of the country’selectricity only supply approximately 1,340 MW during the summer due to a lack of water.Therefore, Myanmar requires 500 to 700 MW of standalone power plants in order to meetthe electricity shortfall that occurs when demand is at its highest yearly levels.

• The lifting of sanctions is expected to create competition among foreign companies foropportunities in Myanmar.

• Frequent power outages in the country and the resulting social unrest have forced thegovernment to allow private sector participation in the power generation market.


• Though Myanmar has been receptive to foreign investments in severalindustries, the stakeholders are still sceptical of investing in the power marketuntil clear directions in terms of establishing policies, stabilising the financialand banking sector, and tackling other political issues are articulated.

• No major development is expected to happen in the power market until 2015.However, after 2015, the power market is expected to gain traction as policy-related ambiguities are likely to diminish by then.

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related ambiguities are likely to diminish by then.

• Political instability, financial insecurity, and poor existing infrastructure havecreated a risky market and can hinder new market entry.

Source: Frost & Sullivan analysis.


The Electricity Industry: Organization and Function of the MOEP, Myanmar, 2012

Ministry of Electric Power

DHPP

DEP

DHPI

MEPE

Hydropower and thermal power project planning

Gas turbine (GT), wind, and other projects planning

Hydropower and thermal power projectsimplementation

Transmission lines, sub-stations, and generation (GT, wind farm, small hydropower generation)

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Power (MOEP)

HPGE

ESE

YESB

small hydropower generation)

Hydropower station and coal-fired thermal plant generation

Electricity distribution

Electricity distribution (Yangon City)

Key:• DHPP: Department of Hydropower Planning• DEP: Department of Electric Power• DHPI: Department of Hydropower Implementation• MEPE: Myanmar Electric Power Enterprise• HPGE: Hydropower Generation Enterprise• ESE: Electricity Supply Enterprise• YESB: Yangon City Electricity Supply Board

Myanmar’s Electricity Industry : Market Drivers & Restraints

Mark

et

Dri

vers

1-3 years 4-6 years

Electricity Industry: Key Market Drivers and Restraints, Myanmar, 2013–2021

7-9 years

Lifting of sanctions

Industrial Development to Increase Demand for Power

Low Electrification Ratio

Availability of Gas

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Mark

et

Restr

ain

ts

Impact: High Medium Low

Country suffered from weak political framework in the past

Less developed banking and financial system

Inadequate Transmission and Distribution (T&D) Infrastructure

Lack of Skilled Personnel

Low Electricity Price

Power Development Plan

ProjectsEstimated Capacity

(MW)Project Details Target Year of Completion

Thermal power projects (coal and gas) 1,700Slide 36Slide 37

2021

The Electricity Industry: Estimated Power Development Plan, Myanmar, 2013–2021

• Myanmar does not have a power development plan in place.

• The following outlines the installed capacity projects that Frost & Sullivan expects Myanmar to develop between 2013 and 2021:

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Note: Since most of the planned projects have not started, the above list is based on Frost & Sullivan estimates.

Thermal power projects by FDI (coal and gas)

276 Slide 36 2021

Hydropower projects 1,256 Slide 38 2021

Total Planned Projects (MW) 3,232

Note: Hydropower projects with a total installed capacity of 41,276 MW (refer to Annexure 1) have been identified to be developed through FDIs. Frost & Sullivan estimates that only 300 MW are likely to be developed by 2015 and around 2,700 MW are likely to be developed between 2016 and 2021. However, due to a lack of transparency from project developers and investors for current project statuses, these projects are excluded from our forecasts.

The Power Generation Market in Myanmar—Centralized Power—Installed Capacity by Fuel Type

Electricity Industry: Installed Capacity by Fuel Type, Myanmar, 2012 to 2021

Fuel Type 2012 Installed Capacity (MW) Share (%) Trend (2013–2015) Trend (2016–2018) Trend (2019–2021)

Hydro 2,420 72.8 ▲ ▲ ▲

Gas 714.9 21.6 ▲ ▲ ▲

Coal 120 3.6 ▲ ▲ ▲

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TrendDecreasing Stable Increasing

▼ ●● ▲

Coal 120 3.6 ▲ ▲ ▲

Diesel 63 1.9 ●● ●● ●●

Bio-mass 4 0.1 ▲ ▲ ●●

Total 3,321.9 100.0

The Power Generation Market in Myanmar—Centralized Power—Installed Capacity Forecast

The Electricity Industry: Installed Capacity Forecast, Myanmar, 2012–2021CAGR*, 2012–2021: 7.8%

4,000

5,000

6,000

7,000

Insta

lled

Cap

acit

y (

MW

)

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0

1,000

2,000

3,000

2012 2013–2015 2016–2018 2019–2021

Installed capacity (MW) 3,321.9 3,766.9 5,393.9 6,553.9

Insta

lled

Cap

acit

y (

MW

)

The Power Transmission and Distribution Market in Myanmar—Existing Transmission and Distribution Capacity

The Electric Industry: Existing Transmission Lines, Myanmar, 2012*

Voltage (kV) Number of Lines Length (km)

230 51 2,983

132 40 2,289

66 137 3,614

Total 228 8,886

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The Electric Industry: Existing Distribution Lines, Myanmar, 2012*

Voltage (kV) Number of Lines Length (km)

33 3,697 6,743

11 3,719 12,781

6.6 1,593 1,435

0.4 - 15,469

Total 9,009 3,6428

The Power Transmission and Distribution Market in Myanmar—Planned Transmission and Distribution Capacity

Future Transmission Network (2011–2016)

• 44 new transmission lines, with total investment requirements estimated at $660 million

• 46 new substations, with investment requirements of about $320 million

Future Distribution Network (2011–2016)

• Between 2012 and 2013, the ESE to expand the 33kV network by 400 kilometers (km), the 11kV by 360 km, and the 6.6KV by 250 km

• System improvements to reduce losses and improve the quality of supply

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Transmission Lines 500kV 230kV 132kV 66kV

Numbers 4 41 8 20

Miles 1,295.0 3,873.8 280.6 995.0

Substations 500kV 230kV 132kV 66kV

Numbers 8 7 10 11

Million volt-amperes (MVA)

4,000 700 805 170

The Electricity Industry: Future Potential T&D Developments, Myanmar, 2012*

Opportunity Assessment—Power Generation and T&D Equipment

Equipment Market Stage Growth Trend Application

Steam turbines and boilers

Growth High Coal-fired power plants

Gas turbines Growth Very HighGas-fired power plants for base load and to meet peak

demands

HRSGs* Growth Moderate Combined-cycle gas-fired power plants

Distributed power generation for stand-by and prime power,

The Electricity Industry: Equipment Analysis, Myanmar, 2012

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Generator sets Growth Very highDistributed power generation for stand-by and prime power,

and to meet peak demands

Gas pipeline Growth Moderate to high Intercity gas distribution network

Transformers Growth Very high Needs for MV* group

Cables and wires Growth Very high MV and LV* cables

Electricity meters Growth High In urban and rural areas

Battery Nascent Low For power production from renewable energy sources

Power storage Nascent Low For power production from renewable energy source power

Solar cell Nascent Low to moderate For rural off-grid power supply

Conclusion: Key Takeaways

• The MEPE to continue to build gas turbine power plants during the short term to meet high demand for electricity

• Pumped-storage power stations to be installed for peak-coverage needs• The MEPE to upgrade T&D lines to reduce transmission losses.• The MEPE to potentially install reactive power compensation devices (capacitor bank, static Var

Compensator [SVC]) at grid and zone substations) as part of its Transmission Losses Reduction Program

• The MOEP to develop more LV lines to provide power connections to people living in rural areas• The MOEP to repair and maintain existing gas turbine plants for better operation and to enhance plant

availability

Short-term:

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availability

• In-place power development plan (PDP) to provide a better understanding of the power infrastructure requirements in Myanmar

• Government likely to provide clear-cut power development support plans for FDIs to complete construction of the planned hydropower projects

• The MOEP to concentrate more on improving the overall electrification rate and on setting targets that can be measured for a given time period

• Existing plans and policies to be reviewed and revised, especially to improve overall electrification rate• Likely upgrade of transmission system voltage to 500kV by the MEPE• Myanmar likely to evaluate the feasibility of adopting renewable energy sources such as solar, wind,

and geothermal resources to generate power• The MOEP likely to announce an energy policy and regulations

Medium-term and long-term:

Analysis of Emerging Opportunities in Myanmar’s Electricity Industry

– Research Service

This research service covers the current state and future potential of the electricity industry in Myanmar. It

provides an in-depth analysis of industry drivers and restraints as well as their impacts in the forecast period.

It provides a detailed analysis of the power generation, and transmission and distribution markets. It also

gives an overview of the power development plan in Myanmar and the power consumption market. Peak

power demand and supply patterns as well as electricity pricing are also covered in the service.

Quantitative Data

�The Power Generation Market in Myanmar—Centralized Power

�The Power Generation Market Myanmar—Distributed Power

Qualitative Data� Executive Summary� Myanmar’s Electricity Industry

Overview

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To get a To get a complimentary complimentary executive summary of this research service, email executive summary of this research service, email [email protected]@frost.com

�The Power Generation Market Myanmar—Distributed Power (Diesel Generators) and Renewable Energy

�The Power Consumption Market in Myanmar

�Peak Power Supply and Demand in Myanmar

�The Power Transmission and Distribution Market in Myanmar

�Power Generation and T&D Market Opportunities Assessment

�Electricity Pricing

� Industry Drivers and Restraints� Company Profiles� Conclusion—Key Takeaways

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Today’s Presenter

Subha Krishnan is a Research Analyst with the Asia Pacific Energy & PowerSystems group and is involved in syndicated research and custom consultingassignments. Her specific focus is on renewable and non-renewable energysector of the business. She has authored several syndicated researchstudies on stationary generators sets, marine generator sets, renewableenergy markets, solar power market, steam and gas turbines market, andportable power market. She has worked on consulting projects to identify themarket opportunities and key research areas globally for Petroleum andGeothermal Research (PGR) portfolio, Nuclear Energy developments,Concentrated Solar Power Technology, and Malaysian EPC market.

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For any other enquiries, email us: [email protected]

Concentrated Solar Power Technology, and Malaysian EPC market.

She has been quoted by leading media such as Pennwell PowerEngineering International Magazine, Solar Business Focus Magazine,Zimbio, Engerati's Oceania Regional Roundup (Australia), New Statesman,Fierce Energy, Gas to Power Journal, and PowerGrid International, to namea few.

Subha Krishnan

Research AnalystEnergy & Power SystemsAsia Pacific – Frost & Sullivan

Masters in Business

Administration,

Bachelor of Commerce

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