CONTRIBUTED ARTICLE – MYANMAR BUSINESS TODAY
After the liberalization process which started in 2011, Myanmar remains beset with an energy and economic challenge. The economy is expected to grow by 8% this year but achieving and sustaining this growth will require better supply of electricity across the country.
The National Electrification Plan announced last year aims at universal energy access by 2030. In practice this means that some remote areas will be getting on-grid electricity only in 10 or 15 years from now.
Productive use of renewable energy (PURE) in combination with off-grid electrification can help these remote areas to achieve economic growth similar to the urban centers. The difference between PURE approach and stand-alone solar systems is that PURE approach built around micro or mini-grids enables local entrepreneurship and job creation.
The Alliance for Rural Electrification (ARE), which is the only accepted industry partner organization of the United Nations Sustainable Energy For All Initiative (SE4All), promotes the PURE approach as a way to multiply economic benefits of energy access for rural communities across the world. ARE represents the decentralized clean energy sector with members along the whole value chain. It was founded in 2006 and acts as a solution provider in order to advance access to decentralized clean energy and energy services in developing and emerging countries.
ARE’s vision is that by 2030 everyone in the world and in particular all rural people in low-and medium income countries would have access to affordable, secure and clean energy and energy services. Several ARE members already work or funded off-grid electrification in Myanmar (Sunlabob, GERES, Schneider Electric, Asantys Systems and ABB through Pact, international non-profit).
A good example of PURE approach in practice are projects by MLinda, an ARE member and a non-profit foundation with a commercial arm in India. MLinda is building micro-grid solutions in Jarkhand which have enabled local women groups to acquire and to manage electric rice milling machines. The machines have become an anchor load for the micro-grids and also a very relevant source to generate additional income for the women involved.
As the farmers can also sell their produce at higher price, this leads to more positive socio-economic effects as the whole community benefits from the additional income. The project has a commercial basis because from the generated incomes the women groups need to also cover expenses such as for repayment of loans made to acquire the rice milling machines and for the electricity supplied by the micro-grids.
The PURE approach is important for off-grid projects because it brings revenue generation to the communities on the top of energy access. Also, if there was no income generation, some communities would not be able to afford to pay for the newly available electricity services. PURE electrification projects bring other benefits including improvements in education, empowerment of women, and improvement in quality of life for the whole community.
Based on the lessons learnt from PURE experiences made in Asia and Africa, ARE members have found ways on how to successfully tackle challenges around it which can be numerous. The PURE approach requires that suitable policy and regulatory framework is in place with at least a level playing field for renewable energy (lack of subsidies for conventional energy sources such as oil, gas and coal).
PURE projects, which are small to medium in size, also require better access to funding. This means allowing for small ticket size, bundling of projects or simply increasing the amounts available for off-grid electrification. Gender bias needs to be addressed given that women are clients or entrepreneurs in PURE projects.
Lessons learnt demonstrate that community involvement in planning stage and its financial commitment (e.g. paying a fee for electricity service) contribute to make the project successful. Partnership between local and international companies can result in better projects, which bring global solutions to local problems.
Myanmar has embarked on a great journey towards universal energy access by 2030. ARE with its Off-Grid Match-Making Platform hopes to support this plan and contribute by delivering productive use of energy in combination with off-grid rural electrification to provide jobs and better quality of life for the people of Myanmar.
This article was published in MYANMAR BUSINESS TODAY
By Katarina Uherova Hasbani, Board Member, ARE / Business Development, Revelle Group