Rangoon Power Board to Seek Private Sector Involvement from 2015

By Kyaw Hsu Mon 26 November 2014

RANGOON — The Yangon Electricity Supply Board (YESB) will begin to facilitate private investment from early next year, with a view to the possibility of an eventual complete privatization of the city’s electricity transmission.

The YESB is currently deciding upon a model for private sector collaboration in discussion with experts and the Rangoon Region government.

“We will form a corporate entity soon, but we’re still finalizing how to structure it,” Mg Mg Latt, the YESB vice-chairman, told The Irrawaddy this week.

“It might be a model where 51 percent is owned by the government and 49 percent by the private sector, so we need more discussion before this project is implemented.”

The YESB currently operates under the Ministry of Electric Power to supply electricity, maintain transmission lines and install new digital meters across the city. The board has been a perennial target for criticism because of prolonged power outages over the summer months and during repairs of the antiquated turbines in Rangoon’s generation facilities.

The distribution network is based on a patchwork assortment of overhead transmission wires and street level transformers, some of which dates back to the colonial era. The outdated infrastructure poses a constant threat of electrical fire and injury.

Mg Mg Latt told The Irrawaddy that private investment would allow a dramatic upgrade of the network, a high priority for the board.

“We’re going to submit this project to the Ministry of Electric Power and the Yangon Region government, and once we get approval we will implement it as soon as possible,” he said.

Myat Thin Aung, the chairman of Rangoon’s Hlaing Tharyar Industrial Zone, said that he is skeptical of whether collaboration between the YESB and the private sector can yield positive results for consumers.

“It’s good to work with the private sector, but I’m curious to see how the relationship works,” he said. “They should have detailed discussions. If [generation] is fully run by the private sector, there will be difficulties in distribution if the transmission wires are still owned by the government. How the private sector deals with policymakers is also a concern.”

In October last year, the YESB announced a rise in the unit cost of electricity for Rangoon consumers, triggering protests and an eventual back down by the board.

Mg Mg Latt said that electricity prices would remain stable into the future despite the courtship of private investment.

Burma’s total national electricity production did not exceed approximately 2,000 megawatts per day in November, with Rangoon’s daily consumption averaging 900 megawatts. The YESB expects consumption in the city to increase to 1,000 megawatts daily in March. Nationwide electricity consumption has increased about 15 percent annually in recent years.

The Burmese government announced last year that it intended to rapidly increase power supply and reach universal countrywide access to electricity by 2030.