News article

UK funds work for public private partnerships for electric power

This world location news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

British Embassy announces over £1m of support to help Burma’s Government get better deals for private sector power investment

On 30 April the UK signed a Memorandum of Understanding with the Asian Development Bank to provide technical assistance to the Government of Burma. This technical assistance will improve the Government’s ability to manage Public Private Partnerships (PPPs), helping the Government to achieve electric power deals that are in the interests of the Burmese people.

Initially, advisers from the Technical Assistance team will work with the Government to develop fair, transparent, and balanced terms for private sector investments that serve the public interest, especially in large-scale power generation projects. Alongside this officials will be trained to identify and develop public-private partnerships. Ultimately it is hoped this will lay the foundations for a sustainable framework for managing PPPs across Government – the goal of the team is to create a sustainable regulatory system by 2018.

Only 26% of households in Burma are connected to the electricity grid, and existing grid systems are in need of major overhaul and massive investment. To date the approach for selecting private sector power projects and for negotiating with private companies has been relatively ad hoc, making it difficult for the Government to determine if it is achieving value for money. There is an acute need to learn from worldwide experience so that Burma can capitalise on the wave of investor interest in the country.

Gavin McGillivray, Head of the UK’s Department for International Development in Burma, said:

Improving access to electricity in Burma will improve the quality of people’s lives and allow businesses to thrive and create jobs. By helping the Government secure good deals for new power sector investment, this work will help the country build an electricity network fit for a rapidly developing Asian economy. It will help give international investors confidence that the power sector can develop in a way that is sustainable, builds on international best practice and allows the best investment to succeed.

Further information

The UK signed the Memorandum of Understanding with the Asian Development Bank, under which the UK will provide £1,026,000 for work up to end-2015. The specific objectives of the project are: • To deliver to the Government sound tendering processes and decision frameworks based on the principles of good design of PPPs

• To promote consistent, objective and transparent application of PPP project development criteria to an international standard

• To create recommendations for development of institutional management capacity for PPP, first within the MOEP and then at national level.

Full details of the project can be found at Asian Development Bank

The UK is supporting the development of Burma’s electric power sector in a number of ways.

• The UK is the largest contributor to DevCo, which is funding advice on the development of a new power plant at Myingyan. Additional information on DevCo available at DevCo

• The UK is providing £19m to InfraCo Asia to develop new infrastructure projects in Burma, focused on rural infrastructure and off-grid power. Additional information on InfraCo Asia available at InfraCo Asia

• The UK is a major contributor to the Energy Sector Management Assistant Program (ESMAP) World Bank Trust Fund, which has funded Burma’s National Electrification Plan. This Plan looks at investment needs to help the Government meet its target for 90% of households to have access to electricity by 2030. Additional information on ESMAP available at ESMAP.