Many foreign investors expected to see an upsurge of new or rekindled existing energy projects in Myanmar during 2021. They hoped the November 2020 elections would be the catalyst for the continued liberalization and expansion of Myanmar’s energy sector. The most noteworthy project tender of 2020 was the Solar Power Tender issued by the Electric Power Generation Enterprise (EPGE) under the Ministry of Electricity and Energy (MOEE) for the purchase of electricity at Designated Connection Points from independent power producers at 30 sites across the country. The combined capacity of the power plants was projected to be about 1 GW and construction would begin in 2021 as per the EPGE’s tender conditions. There were other LNG-to-power and infrastructure projects for which preferred concessionaires were selected and negotiations well underway. As predicted, the Aung San Suu Kyi-led National League for Democracy (“NLD”) was voted into power with a resounding majority. However, on 1 February, 2020, a state of emergency was declared by General Min Aung Hlaing, Commander-in-Chief of the Defense Services. Suu Kyi along with other senior members of the NLD were arrested and put under house arrest. The combined powers of the legislative, executive and judicial branches were vested with the State Administrative Council (SAC). As a result, most projects are halted or in limbo and project developers are increasingly wary of continued activity given the legal uncertainty of the current regime and certification status of their projects. Legal And Regulatory Framework For Projects The regulatory flow for projects in Myanmar typically follows a pattern where the project company (set up by the investor) negotiates an agreement with the...

In March, Vietnam’s Ministry of Industry and Trade (MOIT) submitted its draft Power Development Plan VIII for 2021-2030 to the Prime Minister for consideration and approval. According to the document, the mix of natural gas in power generation sources is expected to rise from 14.9% in 2020 to 26% in 2045 and will significantly replace coal. An estimated US$180 billion will be needed over the next decade to meet the expansion targets for gas and renewables generation facilities, along with LNG gas terminals. As with many developing countries, the likely desirable investment model for LNG-to-power projects in Vietnam is a public-private partnership (PPP). Among the available PPP models in Vietnam, build-operate-transfer (BOT) is probably the most realistic considering the availability of an established legal framework for off-taking and state-sponsored contracts and precedent BOT projects. Sponsors would want the power project to be owned by the BOT company under a BOT contract with the relevant state authority and the LNG infrastructure to be owned by a separate joint venture company, with the cost of LNG infrastructure to be passed through to the electricity tariff. Under current legislation, non-BOT power projects (except solar or wind) are generally ineligible for off-taking arrangements, and are instead required to sell on the “competitive electricity market,” which may raise an important bankability issue. Against this background, Vietnam recently passed a PPP Law and an Investment Law, while issuing a new decree to implement the new PPP Law called Decree 35/2021/ND-CP (together, the “New Laws”). These took effect in early 2021. The changes are not fundamental but do include some features which may be material to...

Over the past five years, solar electricity developers (developers) have busily installed photovoltaic (PV) panels on the rooftops all over Thailand. For commercial and industrial (C&I) businesses, the panels were an easy sell. For instance, PV installations are often financed by the developers, rooftop solar reduces overall electricity costs and the glare caused by the sun shimmering off PV panels can display the occupant’s green credentials. Developers are seeking premier projects such as new factories or stores with creditworthy occupants as they expand their portfolios in Thailand. The initial exuberance remains, but some developers are hesitant to enter Thailand perceiving that many of the best opportunities have already been seized. However, Thailand’s rooftop solar sector can still expand so interested developers must be aware of relevant regulations so they can take advantage of these opportunities. This article will look at how the market might consolidate if developers sell some of their existing assets, which may also create refinancing and bankability concerns. The potential impact of carbon trading markets will also be discussed. Market Consolidation – Regulatory Issues For Buyers And Sellers There are a significant number of developers active in Thailand’s rooftop solar sector and much of their financing is sourced from shareholder equity contributions or corporate lending. This has resulted in projects tying-up developers’ capital and delaying expansion plans. To free up some of this cash, developers may look to sell off existing projects which would consolidate the market and result in merger control issues. Merger Control In 2009, Thailand’s Energy Regulatory Commission (ERC) enacted the Regulation on the Establishment of Criteria to Prevent Mergers, Competition Lessening or...