ADB-Helping Cambodia Transition to Cleaner Energy

ADB-Helping Cambodia Transition to Cleaner Energy.

Check out how public-private partnership helped Cambodia save $100 million in setting up a National Solar Park.

On the Bright side: Discover Cambodia's 100 MW National Solar Park journey to solve the country's surging demand for electricity.

Find out how ADB is helping Cambodia to transition to clean energy.

Cambodia's demand for electricity is increasing each year and the country is not only committed to sustaining their economic competitiveness and growth but also is eager to reduce its carbon dioxide emissions in the energy sector by 16% by 2030 as it transitions to cleaner energy sources.

In 2019, the Office of Public-Private Partnership (OPPP) aided Electricite du Cambodge (EDC) in setting up a 100MW National Solar Park project to resolve fossil fuel price hikes and dry season low electricity production. ADB's OPPP helped mobilize technical assistance advisory services, as well as financing, to start the first 60 MW solar power plant. Through a pay-to-pay contract, ADB is able to find the right construction partner for EDC by conducting an international transparent and competitive bidding. Around 90 companies joined the bidding and the project has been awarded to Prime Road Company.

Transcript

Phnom Penh, Cambodia

Cambodia is one of the fastest-growing economies in Asia today leading to surging demand for electricity.

However, high electricity tariffs have constrained the country's economic competitiveness and sustainable growth. The dry season affects hydropower capacity and fossil fuel imports are expensive.

Transitioning to a clean energy source such as solar can help address some of the sector's challenges.

H.E Ty Norin

Secretary of State

Ministry of Mines and Energy

We should move a little bit faster on solar energy. If we go to the maximum of the injection of the solar to the grid, we can reduce the fossil fuel sources that we use, also we can reduce import from Viet Nam, Lao People's Democratic Republic, and Thailand.

This will make us more reliable, and more secure on the power sources.

Cambodia is committed to reducing its carbon dioxide emissions in the energy sector by 16% by 2030 as it transitions to cleaner energy sources.

ADB is a key enabler of this transformation.

Pradeep Tharakan

Principal Climate Change Specialist

Asian Development Bank

ADB worked with the government to prepare a solar roadmap that identifies the extent to which solar energy can meet the country's power needs.

This 100-MW Cambodian National Solar Project combines expertise of ADB's sovereign operations and ADB's Office of Public-Private Partnership

In February 2019, ADB helped mobilize technical assistance advisory services, as well as financing, to start the first phase of the project.

Siddharta Shah

Director, Advisory Division 2, OPPP

Asian Development Bank

The public sector which Electricite du Cambodge (EDC) took care of the transmission, evacuation facilities, and the right of way. They also acquired the land for the project and then private sector came in. Their job was to construct the best possible project, the best technology, and the best possible price. This all kind of came together in a contract that we call a PPA, which was. Pay-to-pay contract where the public sector for a certain price and a certain quantity guaranteed the offtake for that. So essentially the risk in this project was allocated to the parties who were the best able to address it.

Electricite du Cambodge (EDC) , bidders conference, Phnom Penh

The first phase of the solar park is a 60-MW power plant.

A PPP procurement approach has been designed to attract private sector participation.

Around 90 companies joined the bidding and the project was awarded to Prime Road Company through a competitive international bidding.

HE Keo Rattanak

Minister attached to the Prime Minister

Managing director of Electricite du Cambodge

So through this competitive process, we hope that we will produce the best competitive tariff for consumers in Cambodia and that will be for the benefit of Cambodia as a nation.

Siddharta Shah

Director, Advisory Division 2, OPPP

Asian Development Bank

The project was able to achieve a record low tariff of 3.87 cents which was the lowest at Southeast Asia at that point of time and the country saved $100 million due to the lower tariff.

The solar plant is currently under construction.

The public-private partnership tender process shows how transparent and competitive international bidding can help deliver clean energy at scale.

The flagship solar project will pave the way for similar large-scale solar projects supported by the private sector, providing sustainable energy sources, and stimulating economic growth.