Cambodia, a nation saddled with power shortages, has underscored its commitment to energy security through the implementation of its Power Development Masterplan 2022-2040 (PDP) and the National Energy Efficiency Plan (NEEP). Despite this ambitious roadmap, experts caution that the journey towards these objectives may be fraught with challenges as the country must first address technical and investment hurdles.
"It aims to transition the country towards a cleaner power mix, whilst meeting existing governmental commitments and security, reliability, and affordability of energy supply," Lackovic told Asian Power.
In one of the scenarios under the PDP, the domestic installed capacity of coal in 2030 will be at 2,266 megawatts (MW) comprising 40.4% of the total mix. The capacity will remain the same in 2040 but its share will be reduced to 21.4% due to the growth in other sectors. The share of fuel oils will be at 490 MW for both 2030 and 2040 but their share in the energy mix will be at 8.7% and 4.6%, respectively.
Meanwhile, its imports from Laos and Thailand will be at 3,095 megawatts (MW) and 700 MW, respectively by 2030. By 2040, imports from Laos will be retained but the imports from Thailand will be raised to 1,000 MW. In 2030, it will have around 1,215 MW of capacity saved through energy efficiency measures and it will increase to 2,205 MW in 2040.
"Whilst there has been a fair amount of developments in the market, from the enactment of policies such as the power development plans, regional cooperation, and power project commissioning, we expect that there will be a strong expansion of Cambodia''s power market in the coming years," said David Thoo, analyst for power and low carbon energy at BMI said.
The country''s total final energy consumption is expected to double from the 2020 levels to reach 14 million tonnes of oil equivalent (mtoe), according to a report by the ASEAN Centre for Energy (ACE). This will be led by the transport sector (46%), industry (24%), and residential (16%).
At present, the government''s focus appears to be ensuring energy security over the next 10 years before looking at deploying renewables on a larger scale, Thoo said.
"Cambodia has quite a challenging task ahead of balancing both reducing emissions, and also ensuring energy security as its economy expands, and its power consumption grows," Thoo said.
The PDP estimates the country would need around $9.2b of investment to support the expansion of its generation capacity. Of which around $2.5b has been committed for projects under development from 2022 to 2025.
For 2026–2031, investments were expected to be low because of the full uptake of the scheduled power imports from Laos and progress in its energy efficiency initiative. But for 2032 onwards, Cambodia would need the remaining around $6.7b to fund hydrodams, solar plants, and battery energy storage systems projects.
"This is actually an indication that Cambodia is looking to attract more investment into its power sector," said Thoo. "We expect this to be one of the key features that [we] could see happening in the coming years as the government becomes more open to foreign investments."
In a bid to establish sector-specific energy efficiency policies, Cambodia has instituted the NEEP. This strategic policy aims to curtail total energy consumption by a minimum of 19% by 2030, in contrast to a business-as-usual scenario.
Also, the report underscored how the policy needs to be supported by an increase in awareness among residential consumers on the benefits of shifting from traditional biomass to modern energy sources. This sector is a priority for the government as it accounts for over half of the total energy consumption.
Through this effort, the programmes under the policy can be implemented efficiently. "Moreover, the potential linkage of upscaling investment on energy efficiency with the one for the energy supply side must also be explored. Thus, it could reduce costs and improve coordination among relevant stakeholders involved in both PDP and NEEP," it said in the report.
Phoumin Han, senior energy economist at the Economic Research Institute for ASEAN and East Asia, said that whilst the goals under the PDP are "good news," particularly the significant increase in solar power, deploying them faces policy and power purchase agreement risks such as curtailment issues.
"If you keep building new power plants in a way exceeding the demand, the public will bear the cost through higher tariffs. It is very costly if it is not planned carefully," he told Asian Power.
Han added that there is also a need to upgrade the grid through the introduction of a smart grid as it will help save energy costs and reduce the reserved capacity. He warned that a weak transmission and distribution system could result in a high reserved capacity.
According to the ACE report, Cambodia is also facing challenges on the technical side, particularly in water storage management. It noted that the country had a 400-MW electricity shortage during the dry season, resulting in uncertainty in the future of hydropower.
The report also noted that the development of hydropower projects in the Mekong River contributed to water security issues as the dam is not used to prevent floods, inundating lower ground when water needs to be released from the dam.
Cambodia may face challenges in securing green funding to boost its local generation capacity and high-voltage network infrastructure beyond 2025 as it continues to be reliant on coal power plants, Lackovic said, noting the country''s 2040 target. It also has no plans for early retirement of coal plants.
Ambiyah Abdullah, senior office of the Energy Modelling and Policy Planning Department at ACE, said the private sector will play a crucial role in Cambodia''s energy security as the current government policy allows their involvement.
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