Mohinga Talks: Power Outages in Myanmar with Allen Himes of Indigo Energy

If you have ever lived in any part of Myanmar for more than six months, you have encountered power outages somewhat frequently. Under the Military Junta, we could not really (read: literally) complain about power problems, or anything at all. We considered electricity a privilege back then and a few hour of black outs were considered a glimpse of how our days could be worse. So, we loved the electricity when it was with us and we missed it when it was gone. That’s it. Nobody said anything. Since the so-called elected government took the office in 2011, we have more leeway to get a little braver and started saying a few things we wanted. And stable electricity has always been on top of the endless list of things (we believe) we deserved. We have asked for it from 2011 and we haven’t stopped since.  However, it seems electricity woes are still an enigma to every minister assigned to tackle the problem.

So, last week, Mohinga Matters talked to Allen Himes of Indigo Energy, as an attempt to at least understand this power issue for non-technical people like us.

MM: So when do you think we are getting full time and stable electricity?

Allen: When the ministry raises the electricity price, then we may get stable power. The ministry is now losing money on every unit they sell (Government is losing 54 MMK to 75 MMK per unit).  They can’t be really motivated to actually increase the price. And that’s just within the ministry itself. And if you want to bring investments, everyone knows that if there is no sustainable tariff, outside investors won’t bring in money. There is no money, there is no improvement.

MM: What has the ministry been doing all this time?

Allen: Previous proposed projects have been pipedreams projects, in my opinion. They talked about USD 2.5 billion project in Ayawaddy. And just like Dawei Industrial Zone, it’s been years and nothing really happened. They said “look at least we are doing something”. Even though the projects sounded silly and impractical, they still said “but we are doing something.”

MM: So first thing is to raise the electricity price? How easy is it to do it?

Allen: It is necessary to raise the price and it is important do it in a sensible way. Remember the last time in 2013, authorities said something like “shortly, we gonna raise the electricity price” and people freaked out. The government needs to say “we are going to have to increase the electricity price and in return, we guarantee stable electricity in certain period of timeline”. Without being this transparent, people have trust issues with the government and they will sulk. But at the end of the day, it’s the government who decides and when they officially raise the price, people will have to follow the rules.

MM: How would you encourage people to pay higher electricity price?

Allen: If you go to the remote areas where they don’t have access to the National Grid, you will notice the crazy electricity price because people have to rely on the micro-grid solutions like solar or diesel generators; for example, they have to pay 450 MMK per unit in Homelin. If you really think about it, they need basic lighting in the villages more than we need another air-conditioning running in Yangon. In a way, it looks like these villagers are subsidizing our electricity price because they pay 400 kyats per unit and we pay 35 kyats per unit. So, I think that’s an easy sell especially from the lady herself to talk about it.

MM: Government is now selling power sources like natural gas to China. Why not use that money to invest in upgrading the grid?

Allen: Well, people like to complain “china takes all of our power” but you don’t have to sell it. Whenever the government made the contract (to sell energy), they had a choice: they could invest themselves in hydro and gas turbines to power their own country or sell it just to get money.  And they sold it to get money. They can say they have to sell energy overseas to subsidize power here. The money received from selling natural gas is about USD 3 billion which is quite higher than the loss in electricity subsidies which is about USD 500 million in 2018. So yes, they can really do something with that kind of money too.

MM: So who really is the most responsible person to get things moving?

Allen: Ministry of Planning and Finance (MOPF) said it’s down to the Ministry of Electricity and Energy (MOEE).  MOEE said they cannot do anything without Parliament and somebody else said something else. Who is ultimately responsible to make the decision? I am not sure. There are many ways to get things done, anyway. If you have the right people and right motivation, they will change the policy. People are the most important.

By 2030, Myanmar plans to provide electricity access to 100 percent countrywide (Ref: Ministry of Electricity and Energy) and economic development of the country heavily relies on whether that goal comes true or not. If it does not happen, it is very likely our country will sit in the dark for a long time both socially and economically. So, like Allen said, people are the most important to get the country moving forward and it could mean each and every one of us should pay a little higher electricity prices.

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Allen has been in Myanmar since 2012 and his venture “Indigo Energy” focuses on providing rooftop solar projects designed for factories and businesses.  Indigo Energy recently completed its first major project in Dawei Township where they installed 80kW solar project at a private hospital, with support from a Danish NGO.