Southeast Asia Looks to Microgrid Technology to Electrify Remote Areas

The islands and hilly jungles of Southeast Asia are not easy places to build power grids. Power lines in the region are pricey to erect and difficult to maintain, making electricity service expensive and unreliable. There are 125 million people in the region without access to stable power, according to Cleantech Group, an investment adviser in San Francisco.

Now Southeast Asian governments, international development agencies, and energy companies are turning to microgrid technology to help solve this problem. Microgrids use a combination of solar panels, batteries, engine generators, and small gas turbines to serve remote villages and factories, among other use cases.

Regional Plans Differ, But Myanmar Leads the Microgrid Charge

Altogether, there are plans to spend $14 billion across the region to reach universal electricity access by 2030, according to Global ClimateScope, a research platform affiliated with Bloomberg.

While Thailand, Malaysia, and Vietnam are looking at extending conventional grids into rural areas, others are turning to microgrid technology as a lower-cost alternative. As much as 75 percent of the off-grid population could be served through microgrid systems, according to Cleantech Group. It sees Malaysia, Indonesia, and Myanmar as leaders.

With electrical service to only 57 percent of residents, Myanmar is focusing on microgrids that would power mobile phone transmitters in order to extend telephone service in rural areas. Local company Yoma Micro Power attracted $28 million in funding in April of 2018 from the World Bank's International Finance Corporation (IFC) and the governments of Canada and Norway. Yoma has completed 10 telecom microgrid projects and plans to complete hundreds more, according to a press release. Similarly, Paris-based Voltalia signed an agreement with the state phone utility in February of 2018 to power 171 telecom towers with solar, battery, and diesel generator microgrid systems.

Aero Aids Indonesia, While Microgrids Beat Brownouts in the Philippines

Indonesia is largely electrified, but many islands in the eastern territories, such as Papua, are not. As much as two-thirds of the population there was without power in 2016, leading the government to launch the Bright Indonesia initiative, with a goal of fully electrifying the region by 2019.

GE has installed a dozen fast power generators in Indonesia to shore up unreliable parts of the grid. The 25-MW, truck-mounted aeroderivative turbines, derived from jet engines, can run on natural gas or diesel fuel.

The Philippines similarly have many remote islands that are still waiting for electricity. In May, Shell's philanthropic arm, the Pilipinas Shell Foundation, announced plans to bring microgrids to 20 villages in the state of Palawan, home to Shell's multibillion-dollar Malampaya natural gas project, reports the Manila Bulletin.

In March, local developer Solar Philippines completed a 2-MW solar project with 2 MWh of Tesla Powerpack batteries in the village of Paluan, in Mindoro province, according to Energy Storage News. The national utility had been paying more than $550,000 per year to subsidize service to the remote village—and deliver power only 16 hours per day. Mindoro experiences frequent brownouts, so when the Paluan project came online, villagers gathered to celebrate, hoisting a huge banner that read, "No More Brownouts," Energy Storage News reports.

Affordable Power and New, Better Options Are the Drivers Behind Change

Given its large number of islands and remote villages, Southeast Asia is an attractive region for microgrids. As the capabilities and economics of distributed energy improve, microgrids may even start to displace large, centralized grids in such regions. The Paluan project is just the first of 10 solar microgrids that Solar Philippines plans to deploy, and it has proposed to develop a 5,000-MW solar-plus-storage project to replace all proposed new coal plants in the country. Solar Philippines claims the project will cost only Php$2.99 (US$0.055) per kWh—"the lowest rate of any new power plant in Philippine history."

Whether or not microgrids will dethrone the main grid in the Philippines in the future, they're bringing cost-effective power to remote areas today, which wouldn't otherwise be possible. As long as Southeast Asian grid power remains expensive and unreliable, microgrid applications will continue to be an attractive, transformative option for communities in the region.