Overview of Electrification Options for Kalone Htar January 8, 2018 Dr. Chris Greacen 1

Grid extension How intermittent is electricity? Electricity in how many years? What cost per household to connect? What tariff per kWh? This is a somewhat different definition than the def of mini-grid used in North America and Europe. There mini-grids (or sometimes micro-grids) refers to much larger installations that provide backup power for factories, server farms, or other users that require exceptionally high reliability – 99.99999%reliability instead of he 99.9% that utilities can offer. Mini-grids in remote villages have lower reliability needs, and generaly use smaller amounts of electricity. Generally, but not always, they are not connected the main grid.

mini-grid Mini-grid: an electric network used to distribute electric current within one or several villages. Generally <10,000 customers and include local generation. Minigrid This is a somewhat different definition than the def of mini-grid used in North America and Europe. There mini-grids (or sometimes micro-grids) refers to much larger installations that provide backup power for factories, server farms, or other users that require exceptionally high reliability – 99.99999%reliability instead of he 99.9% that utilities can offer. Mini-grids in remote villages have lower reliability needs, and generaly use smaller amounts of electricity. Generally, but not always, they are not connected the main grid.

Minigrid examples

Diesel Currently in Myanmar most mini-grids look a lot like this. In many cases they are built and operated by Village Electrification Committees. These committees are a common part of village-level government in Myanmar, and are comprised of a local leaders. Sometimes a local Buddhist temple owns and operates the generator. Other times it’s a village entrepreneur. Typically less than 20 kW. 230 volt distribution networks snake through the village on wooden poles and

Diesel Advantages Disadvantages Low initial cost High operations cost (fuel) Noise Smells Frequent repairs Too expensive to run 24 hours/day

Micro hydro

Myaing village hydro, Shan state

20 kW -- Indonesia

3MW Nam Khun, Kyaing Tong Kyi Thien Family Co. & Kyaing Tong Energy Co 3MW Nam Khun, Kyaing Tong Kyi Thien Family Co. & Kyaing Tong Energy Co., Ltd. -On behalf of ESE, Kyaing Tong Energy Co. Ltd. distributes electricity in Eastern Shan State.   -In the Kyaing Tong area, the demand for electricity is increasing rapidly. In response, small hydropower schemes have forged ahead to meet the energy demand. -While Kyaing Tong Energy Co., Ltd. and Kyi Thein Company were implementing new projects in and around Kyaing Tong area, the necessary machines and spare parts were being imported from abroad and the civil works was being addressed by experienced experts from the company.

Hydro - Pinluang, Shan State

Micro hydro: advantages and disadvantages No fuel cost 24/7 operation No batteries to replace Make us of local labor to build More easily locally manufactured Disadvantages Site-specific design Higher initial cost than diesel Social & environmental impact if not implemented well O&M cost per year = 5% of initial cost

Myi Chin Naing – solar PV One of three identical 3.6 kW solar powered grid-ready mini-grids that power Myin Chi Naing village, Myanmar

Solar PV: advantages and disadvantages No fuel cost 24/7 operation Sunlight is widely available Disadvantages Higher initial cost than diesel Requires batteries, which must be replaced every 3-8 years O&M cost per year = 3% of initial cost

Royal Htoo Linn Manufacturing Co., Ltd Biomass gasifier Royal Htoo Linn Manufacturing Co., Ltd Sittwe,Rakhine State

Biomass gasifier: advantages and disadvantages Affordable (compared to diesel) Disadvantages Requires fuel supply (typically wood chips or rice husks) Requires cleaning/rebuilding periodically Pollution issues O&M cost per year = 20% of initial cost

Villages with 70% of households electrified State & Region Total Villages Electrified Villages Electricity Solar Solar (Mini-Grid) Hydro Diesel Biogas/ Mass Unelectrified Villages Nay Pyi Taw 796 319 242 75 2 477 Kachin 2582 1041 356 494 131 56 4 1541 Kayah 511 534 151 9 18 -23 Kayin 2063 729 281 372 10 15 50 1 1334 Chin 1346 666 11 385 269 680 Sagaing 6005 2631 1076 1019 14 103 391 28 3374 Thaninthayi 1230 390 33 353 3 840 Bago 6495 1315 829 472 8 5180 Magway 4795 1553 624 469 406 3242 Mon 1150 702 402 182 116 448 Mandalay 4781 2700 1549 639 37 441 19 2081 Rakhine 3760 1177 98 594 485 2583 Yangon 2129 1127 821 306 1002 Shan(S) 4965 1511 810 411 40 227 23 3454 Shan(N) 6079 1260 564 506 181 6 4819 Shan( E) 3304 524 107 218 199 2780 Ayeyarwady 11908 2258 709 679 811 9650 Total 63899 20437 8868 7325 150 1215 2407 43462

Distribution networks

Policies and regulation

Mini-grids and the Arrival of the National Grid

ESE LV ESE MV

National electrification program (NEP)

Myanmar’s electrification challenge is immense… Current electrification rate: 33% Goal: 100% electricity access by 2030 Need to connect over 2x as many households per year to reach universal electrification by 2030… New household connections per year ESE YESB Required 189,000 Source: MOEP (2011-2012), ESE, YESB data and Castalia estimations Assumes 6.5 people in a household

Recommended Sequencing of Grid Roll-out proceeds from low-cost to high-cost connections Connected earlier Connected later

National Electrification Program (NEP) First 5 years: $400 Million loan from World Bank $310 Million grid expansion Ministry of Energy and Electricity (MOEE) $90 Million off-grid Department of Rural Development (DRD) Roughly $7 million for mini-grids Next call for proposals in November 2018

>50 households in village Some criteria for NEP mini grid support >50 households in village >10 miles from MV grid (national grid?) Productive use loads (e.g. carpentry, welding, agricultural processing) Village pays 20%, developer pays 20%, NEC pays 60% Villagers willing to pay tariff Prior experience of mini grid developer

Cost estimate calculations…

Mini grid cost estimates Micro-hydro cost range: 20 to 30 lakhs kyat per kW Solar PV cost range: 40 to 60 lakhs per kWp Distribution cost per household (Low voltage - LV) 2.5 lakhs (average) not including internal household wiring 11 kV lines (per mile) 370 lakhs 11 kV transformer 120 lakhs Micro-hydro cost range: 2700 to 5400 kyat per watt ($2 to $4 per watt – based on author’s impression of costs of higher quality micro-hydro in Myanmar Solar PV cost range: Distribution cost per hh (LV) 2.7 lakhs (average) not including internal household wiring. Based on average of CFP1 costs for mini-grids

Example calculations Site 2: 50 kW micro-hydro Site 1: 10 kW hydro Site 1: 30 kW hydro + 20 kW solar Site 2: 50 kW micro-hydro

Tariffs Connection charge Per kWh Subscription tariff Block rate Time of Use (TOU)

Per appliance Examples 1000 kyat per month 2000 kyat per month 3 lights Cell phone 2000 kyat per month 4 lights TV

Energy Tariff (per kWh) Example: 100 MMK per kWh

Subscription (power) Tariff (per watt) 5000 MMK per month for 50 watts 10000 MMK per month for 100 watts or MCB PTC

Block rate tariffs: Progressive block rate Tariff structures PG&E’s (California) increasing-block residential electricity rate structure

Progressive block rate: subscription tariff example Tariff structures Progressive block rate: subscription tariff example Ghandruk, Kaski District, Anna Purna, Nepal Micro-hydro Households: 1.5 rupee per watt per month Tourist lodges: 2 rupee per watt per month Lodges use much more than households. Loads include rice cooking, bread baking, hot showers for guests or MCB PTC

Time of Use (TOU) tariff Tariff structures High price High price Low price

Pre-Paid Metering Technology power limiting and disconnection abilities TOU, block rate Simplifies payment collection and consumer accounting

Thank you! Chris Greacen chrisgreacen@gmail.com