The five Power Purchase Agreements (PPAs) signed in March between the government and private sector companies can potentially serve as templates for future agreements, making it easier to get electricity generation projects off the ground, according to experts.
Speakers at a 15 June seminar on PPAs and Partnership with the Myanmar Government, which was attended by the Myanmar Energy Monitor, said they would like to see a more central standard for PPAs. Some features such as feed-in tariffs are now becoming standardised, though others, such as payments in instances of force majeure, have taken more time to become uniform.
“So if you ask me if we have a template for everyone, I would say not quite yet,” said one speaker.
The seminar was held by legal and tax advisory firm VDB Loi along with Latham & Watkins LLP and the International Project Finance Association.
Panellists said they were optimistic that a standard template will be adopted, though it remains to be seen how quickly this will take place.
Five PPAs were signed by the former Union Solidarity and Development Party government in March, just before the National League for Democracy (NLD) took power at the end of the month.
The five PPAs were signed by the Myanma Electric Power Enterprise, which has since become the Electric Power Generation Enterprise (EPGE) under the new government.
The projects include the 225MW Myingyan gas-fired plant in Mandalay, the 200MW gas-fired Kanbauk plant in Dawei, the 485MW Thaketa gas-fired plant in Yangon, the 300MW Minbu solar plant in Magwe and the 300MW ACO project in Meiktila.
It is likely the change in government will have some effect on future PPAs. Already, the former Ministries of Electric Power and of Energy have been combined into one new entity, the Ministry of Electricity and Energy.
The five PPAs are quite different from many of the previous agreements signed by former governments. For instance, many of the previous agreements had the feed-in tariff adjusted on a yearly basis, though international firms and lenders would prefer to see the certainty of a fixed tariff.
One speaker at the event also said it is likely that there will be a re-signing of existing PPAs with the change in government, though official confirmation has not yet arrived.
