Energy Security and Climate Change
13 December 2023
The Asia Pacific is one the regions to be greatly impacted by El
Niño in 2023-2024. Myanmar has already experienced severe
flooding and extreme swings in weather, even though we were
projected to be affected between December 2023 and November
2024.
Myanmar is widely considered to be one of the countries mostvulnerable to the impacts of climate change. In May 2008,
Cyclone Nargis killed nearly 140,000 people and caused over 10
billion dollars in damage (30% of GDP). Cyclone Mocha in May
2023 was less deadly but caused around 2.5 billion dollars indamage (3% of GDP). Our commercial capital Yangon, which
contributes a quarter of the country’s GDP, is the 4th fastest
sinking coastal city in the world, ahead of Jakarta.1
Climate change is putting energy security at risk, affecting fuelsupply, energy production, resilience of current and future energy
infrastructure, and energy demand.

1Tay C, Lindsey EO, Chin ST, McCaughey JW, Bekaert D, Nguyen M, Hua H, Manipon G, Karim M, Horton BP, Li THand Hill EM. Sea-level rise from land subsidence in major coastal cities. Nature Sustainability 2022 Sep 12; 5:10491057

Myanmar Power Sector
Myanmar’s power sector has been spiralling downward since end
2021 with prolonged blackouts across the country. Fiscal
constrictions, economic challenges, conflict and political factors
have impacted the stability of the entire transmission system. The
power grid, including transmission stations, gas lines, repair
crews and utility offices, have been attacked over 200 times
between February 2021 and April 2023.
Changing climate conditions and energy mix calibrations causedmore water resources to be utilised from reservoirs during theMonsoon seasons, causing sharp drops in water available forirrigation.

Power Projects
Myanmar has a number of power projects but most are on holdfor now or still in the exploratory phase. Projects include: the1,390MW Mee Lin Gyaing LNG project; the 388MW Ahlone LNG
project; the 600MW Kyaiklat gas power plant; the 280MW Upper
Yeywa project; the 111MW Thahtay hydroelectric plant; the52MW Upper Kyaingtaung; and wind power projects in Rakhine.
Myanmar signed an Intergovernmental Agreement with Russia inend-2022 to collaborate in the installation of small civilian nuclear

power plants. Two MoUs were also signed with Russia’s
NovaWind in June 2023 to install 372MW of wind power projects.
More recently, Myanmar signed an agreement with China lastmonth to purchase 90MW of electricity from three solar projects incentral Myanmar.

Sanctions on the Myanmar Power Sector
On February 2022, the European Union imposed new sanctions
on Myanmar that included the state-owned Myanmar Oil and Gas
Enterprise (MOGE), The restrictions come on top of withholding
EU financial assistance going directly to the government and thefreezing of all assistance that may be seen as legitimising themilitary government. The United States imposed a ban on
financial transactions to MOGE as well starting from December
2022. Multilateral finance institutions have also halted loans andgrants.

ImpactOfficial statistics show that Myanmar produced 1,700 gigawatthour (around 8%) less electricity from April 2022 to March 2023
compared to the same year before. Other reports note a steeperdecline. Energy shortages are affecting all aspects of life acrossMyanmar.
Unstable power supplies are affecting the storage of essential
medicines and samples. Most factories and commercial buildings
use diesel generators. These outages impact the competitivenessof MSMEs in the manufacturing and service sectors, such as thelow-margin garment industry that is a major source of
employment for nearly half a million young women, representing
around 1% of the Myanmar population. Increased reliance ondiesel is causing higher fuel prices that also affect agricultural
productivity as farmers cannot afford to run irrigation pumps.
One of the impacts of sanctions is that it is now harder to maintainand repair the gas power plants feeding the national grid. Poweroutages now cause long queues at compressed natural gas(CNG) filling stations, which are used mainly by public buses andtaxis.
The political situation has also impacted interest and operations ofinternational companies in both the exploration of offshore gas
fields and investments in power generation.

Outlook
Some private companies are working on mini-grids and otherenterprises are adopting standalone solar installations whilehomes are using inverters and batteries to mitigate the impacts.
Many enterprises have diesel generators but only a fraction knowof renewable energy alternatives and their financial viability. The
government has emphasized solar energy and electric vehicles as
key components for energy security and self-sufficiency, butbanking challenges, highly subsidised utility rates and the security
situation are affecting investor interest. Myanmar is also starting
to explore wind energy along its coast as well as in the highland
regions.
Myanmar’s energy sector faces many challenges, including
political headwinds and access to financing. It is a major focus ofpolitical pressure and sanctions onto the current authorities, but
the impact falls mainly on ordinary citizens and ordinary
businesses. Some are trying their best to adapt in the face of bothmanmade and climate change linked challenges, but more needs
to be done by all concerned stakeholders. For example, theGovernment needs to address issues such as supply reliability,
greater accessibility and affordability. Furthermore, efforts should
be made by foreign governments to ensure that the fallout of theirpolicies and punitive measures do not add more burden onto theMyanmar people.

The energy mix reflects a trade-off between concerns for theclimate and energy security. Concerns about energy security
increase support for fossil forms of energy and even drive
opposition to renewable energies. Conversely, concerns aboutclimate change increase support for renewable energies. Energy
policies and commitments need to better address energy security
in a changing climate and promote the transition to net zero,including by scaling up climate services.
The energy industry has extensive experience using weather
services but less experience with climate services, the latter beinga more recent endeavour. However, in the context of thechanging climate and the energy transition, new approaches
based on climate information are required. As energy system
become increasingly dependent on weather variations, it isapparent that the information flow from weather and climate data
and forecasts needs to be properly incorporated into the decision
support systems.
Developing a market for distributed renewable energy requires
important considerations, including awareness raising. Stronger

domestic supply chains can be developed. Importing renewableenergy equipment can be promoted through tax and duty
exemptions, or green financing initiatives.
Long-term planning for the transition to generating a higher
percentage of the energy mix from renewables is also dependent
on climate services and information.
Well-designed policies and structural reforms to support climate
mitigation, that is reducing carbon emissions; and climate
adaptation such as is minimising damages from climate-related
disasters, increasing the share of renewables in the energy mix
and improving energy efficiencies, will help reduce CO2emissions and strengthen energy security.