Myanmar Junta Cancels Chinese-Backed Solar Power Projects
By The Irrawaddy 5 May 2022
Myanmar’s military regime has cancelled tenders invited under the now-ousted National League for Democracy (NLD) government for 26 solar power projects, and blacklisted the companies for breaching tender regulations.
In May 2020, the NLD government invited bids for the construction of 29 ground-mounted solar projects capable of generating a total of 1 gigawatt of power under a 20-year build, operate and own contract.
Chinese companies and their consortia won the bids to build 28 out of the 29 plants, according to results released by the Ministry of Electricity and Energy in September 2020.
However, only three solar projects are currently being implemented and Chinese firms have stalled on the other projects.
The junta’s blacklisting of the firms came after it replaced electricity and energy Minister U Aung Than Oo earlier this week with U Thaung Han, the former chairman of the Mandalay Electricity Supply Corporation, with the stated purpose of ‘better implementing the electricity and energy sector’ amid serious power outages in Myanmar.
An office letter of the Electricity Supply Enterprise seen by The Irrawaddy reveals that among the companies blacklisted are Sungrow Power Supply Co, Consortium of SPIC Yunnan International Power Investment Co, Khaing Lon Gem, China Machinery Engineering Corporation, Consortium of Shwe Taung Development Co & GCL System Integration Technology, Consortium of China Gezhouba Group Oversea Investment Company and Future Energy Company Limited and XI’an LONGi Clean Energy Company.
China’s Sungrow Power Supply Co won tenders to implement 12 solar projects, the maximum number of projects among the tender winners.
The minimum investment was set at US$20 million (25.8 billion kyats) per site, with each project expected to generate 30 to 40 megawatts of electricity. The proposed sites are in Ayeyarwady, Bago, Magwe, Mandalay, Sagaing, Naypyitaw and Yangon regions.
Tender winners were announced in October 2020, but Chinese firms have repeatedly postponed signing the power purchase agreements after the military seized power in a coup on February 1, 2021.
The companies have therefore breached the tender regulations, said the Electricity Supply Enterprise letter.
Chinese companies won the tenders by offering to sell electricity at prices between 3.5 and 5.1 US cents (45-65 kyats) for 1 kilowatt of electricity, a rate much lower than those quoted by other regional and western companies.
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