Burma’s chronic shortage of electricity, which threatens to stymie
economic growth, could be eased by pushing for acceleration of plans by the
Association of Southeast Asian Nations (Asean) for a regional power grid.
Cross-border electricity swaps
are growing as the 10-country bloc moves towards the goal of a single market by
2015. And one of the planks of the closer regional economic integration
platform is a borderless energy network.
In a region where national
self-interest and rivalry has been the rule for decades, Asean—45 years old
this year—is playing an increasing role in forging closer business integration
between its members.
Cooperation on power exchanges
are being driven by rapidly rising demand and domestic production, which
increasingly struggles to match it.
Asean plans for a regional power
swapping grid are part of the organization’s ambitions for 2020. However, some
countries are already developing electricity-swapping cross-border links and
Burma could use its year as president of Asean in 2014 to push the project
forward, say energy planners and experts.
There are already cross-border
power links between Cambodia and Vietnam, Laos and Thailand, Malaysia and
Singapore and now proposals for link ups between Burma and Thailand.
The biggest cross-border exchange
of power supply so far is being developed between Malaysia and Indonesia, where
state energy agencies have now inked two significant agreements on two-way
electricity. This has all happened since March, when the Indonesian Parliament
approved a law permitting the export of electricity for the first time.
The former governor of the state
Electricity Generating Authority of Thailand (EGAT) and now a senior Thai
government adviser on energy, Kraisi Kannasutr, has spoken in favor of Asean
power integration as a way of benefiting economic development for Thailand and
its neighbors.
He told a Bangkok Senate inquiry
into energy that a regional power grid would reduce electricity costs overall
by pumping power to where it was needed cheaper than producing it in situ.
For example, this would help the
development of a port-industry complex at Dawei on Burma’s southeast coast,
proposed by Thai firms but currently in limbo—partly because the project lacks
energy.
Thailand has a generating
capacity of 26,000 megawatts, which reaches most remote rural areas of the
country, while Burma has a mere 1,800 megawatts capacity, reaching barely 25
percent of the population and then for only a few hours each day.
“Until recently, Thailand has
sought to milk the energy resources of Burma for its own use the way China
has,” Bangkok power industry consultant Collin Reynolds told The Irrawaddy on
Aug. 25. “I think the Thais are now realizing that if they are to benefit from
Burma’s economic development there will need to be cooperation on electricity
supplies, just as there are plans for trans-border road and railway networks.”
An example of such a system
already being forged is a cross-border grid linking Malaysia’s Borneo State of
Sarawak with Kalimantan, Indonesia’s Borneo province. Separately, an undersea
transmission cable is planned between Indonesia’s Sumatra and peninsular
Malaysia’s west coast as a result of a coal mining and power plant joint
venture.
Malaysian state power monopoly
Tenaga Nasional Berhad, or TNB, is teaming up with its Indonesian counterpart
PLN and Indonesia’s state-owned coal miner Bukit Asam.
The threesome will cooperate in a
mining, power plant and power exchange project costing over US $2 billion.
A coal mine with a 6 million
tonnes per annum capacity is to be built in Riau Province in Sumatra to feed a
1,250 MW plant. Electricity produced will be shared between PLN and TNB, who
will also share the coast and ownership of a 53-km cable to be laid beneath the
Malacca Strait and into Malaysia.
The agreement envisages Indonesia
transmitting power to Malaysia during off-peak times and TNB reciprocating
during its off-peak period.
Work on the mine is to start
soon, according to Bukit Asam, with the power plant and cross-border cable
scheduled for completion by 2017.
Peninsular Malaysia suffered
power shortages for the first time in 2011 and the shortfall had to be plugged
by buying electricity from Singapore. The shortages were triggered by a decline
in domestic gas supplies on which TNB has been dependent for 70 percent of its
system.
Ironically, Malaysia has a
surfeit of electricity in its two Borneo states, Sarawak and Sabah, due the
massive Bakun Dam which flooded an area of jungle the size of Singapore. Power
from the multibillion dollar 2,400 MW dam project was originally meant to be
transmitted to peninsular Malaysia by undersea cable across more than 500 km of
the South China Sea, but TNB abandoned this long-held plan on cost grounds.
Instead, PLN will buy some of the
Bakun capacity, which will be shipped across the border into power- hungry
Kalimantan via a 120-km cable. When the first electricity flows in 2014 the
West Kalimantan grid will have a 20 percent increase in its distributable supply.
Despite abundant coal resources,
much of Kalimantan’s limited power supply is generated via expensive oil and
diesel fuels.
Under-developed Laos is
benefiting from deals in which Thai firms finance and build hydro dams on its
side of the border, separated by the Mekong River. They pump much of the
ensuing electricity into Thailand, but some power goes to Laos, which also
earns income.
“The cooperation between
Indonesia and Malaysia in energy is the best example yet of how countries
within Asean are likely to increasingly merge their power systems,” Hong
Kong-based energy industries analyst Vince Lomax told The Irrawaddy.
“In the short-medium term I think
we will see a move by Thailand to boost Burma’s electricity supply. This will
be necessary if Thai business is to benefit from investing in the emerging
economy of its neighbor.”
However, plans by Thai firms, led
by EGAT, to build a 1,280 MW hydro dam directly on the Mekong in Laos are
meeting stiff opposition from Cambodia and Vietnam downstream.
They argue that a dam would
undermine river flows and damage their freshwater fishing on which millions of
people depend.
But as Asean’s economies grow and
the combined 620 million population demands more electricity, it increasingly
looks like compromises will have to be made.
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