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Cambodia’s Mismatch of Solar Potential and Energy Harvesting
Kampong Chhnang, Cambodia

Cambodia’s Mismatch of Solar Potential and Energy Harvesting

Lorn Chanlita, 23, had long wished to run her own business of selling sugar cane juice to support her family. But her dream only became reality after her village was electrified by solar power early this year.

Before solar, Chanlita used a generator to power light bulbs, fans, a TV and – once in a while – a water pump to irrigate her rice field. With solar, Chanlita can not only power a sugar cane extractor and ice-cutting machine, she also can connect more devices and keep her business open later in the evening.

“It helps me save time and is more convenient,” she said. “The generator was noisy and it was hard work to start it.”

Chanlita’s village, Steung Chrov, is in Kampong Chhnang province, on an island in the Tonle Sap River.

Solar power is transforming remote communities like Steung Chrov with affordable, renewable energy and the chance to live more productive lives. But hundreds of other villages remain off the grid, and energy experts say Cambodia should be doing more to harness the country’s immense amount of untapped sunlight.

VOA Khmer used data from the Electricity Authority of Cambodia 2021, the International Renewable Agency, International Energy Agency, Our World in Data and the Mekong Infrastructure Tracker, the Cambodia Socio-Economic Survey 2019/20 to explore these and other issues, including solar trends, how Cambodia compares to its neighbors, and where national policy may be falling short.

Solar Surge Initially Driven by Non-government Players

According to the International Renewable Energy Agency (IREA), access to solar energy in Cambodia is 11 times higher than it was just a few years ago. Approximately one third of a million households, or 8.4% of overall Cambodia households, are benefiting from off-grid or micro-grid solar (Cambodia Socio-Economic Survey).

In 2016, there wasn’t a single solar plant in the country. Today, seven solar power plants are connected to the national grid and capable of producing up to 305 megawatts (MW), according to Stimson Center’s Mekong Infrastructure Tracker, a platform to track, monitor and quantify the development project, including the energy sector.

The country’s first 10 megawatt (MW) solar power plant came online in 2017 with support from the Asia Development Bank (ADB). Meanwhile, the country’s Rural Electrification Fund, supported by the World Bank, provided solar home systems to more than 60,000 rural households between 2013 and 2017.

“Cambodia has some of the richest solar resources in the region, which could be harnessed in a complementary manner to hydropower,” said Anthony Gill, acting country director of ADB’s Cambodia Resident Mission, which is helping the government prepare a Power Development Plan for the next 20 years.

The initial surge for solar didn’t come from the government, however. It was driven by investors and development donors who want “to support Cambodia to switch focus from hydropower generation and non-renewable resources such as oil, natural gas and coal to green energy,” said Han Phoumin, an energy economist with the Economic Research Institute for ASEAN and East Asia.

Frequent blackouts and high electricity costs – especially in commercial zones – were additional factors, as was price. The cost of solar photovoltaic modules has dropped dramatically, almost 80 per cent from 2010. “Private investors see this as an opportunity,” Phoumin added.

Moving toward solar is a combination of economic arguments, said Courtney Weatherby, deputy director and research analyst of US-based Stimson Center’s Southeast Asia program. It’s a combination of low-cost electricity, widespread solar potential in Cambodia, and sustainability concerns about reducing investment in carbon-emitting fossil fuels or controversial large-scale hydropower plants.

She also cited international investors in manufacturing “who are looking to green their own supply chain and have expressed concern about plans for coal expansion inside Cambodia.”

A Pledge Toward a More Renewable Energy

Cambodia’s current domestic electricity supply is dominated by coal power plants and hydropower, at 41% and 44%, respectively, while solar is at 6% and growing.

According to the Ministry of Mines and Energy, Cambodia aims to have an additional 495 MW from seven solar power plants expected to be put into operation, representing 20 percent of total energy supply by 2023.

In late October, Minister of Mines and Energy Suy Sem pledged to end new approval for coal-fired power plants. He made the commitment during a meeting with UK Ambassador to Cambodia Tina Redshaw, prior to the United Nations Climate Change Conference of the Parties (COP26). The move came after China’s President Xi Jinping told assembled world leaders at the UN in New York that China would phase out new coal-fired power projects.

“In light of recent indications from China, there may be a faster shift towards solar inside Cambodia in the medium term,” Weatherby predicted. “As the market continues to evolve and prices are projected to drop for both solar and energy storage technologies, the economic rationale for shifting towards solar and other renewable energy technologies is likely to grow stronger.”

In March 2020, the government announced it would halt two planned hydropower dams – at Sambor and Stung Treng – and would not build any new hydropower dams on the mainstream Mekong River for the next decade after concerns were raised about the impact the dams would have on farmers, fish and the river’s biodiversity.

“Solar is clean, free-fuel, it is an investment, and the cheapest way for EDC to buy electricity,” said Bridget McIntosh, outgoing country director for the NGO EnergyLab Cambodia, using the acronym for state-run Electricite du Cambodge, which is responsible for generation, transmission and distribution of energy. Investing now in solar, she added, “is like pre-paying for fuel over 20 or 30 years.”

It’s difficult to calculate how much investment would be required for solar to outpace coal and hydro. But scaling up solar – and wind power – would be a significant step toward a lower-carbon electricity grid to minimize air pollution and carbon emissions as well as cause less harm to the Mekong River’s ecosystem, experts said.

“In the future, Cambodia could develop solar to be the main source of energy supply if the government takes it seriously,” Phoumin said. “With our solar potential, we can build battery storage for solar farms or even go for hydrogen development. In fact, we don’t need any more coal or hydropower projects.”

Number of off-grid Households Remain High

Despite Cambodia’s recent growth and development, 1 out of 5 households in rural areas remains off-grid, meaning they don’t have access to power provided by utilities, and are unable to access reliable and affordable electricity, according to the Cambodia Socio-Economic Survey. Cambodia’s electrification rate remains the second lowest in Southeast Asia, after Myanmar’s.

While the government has extended its national grid, it has been slow to build transmission and distribution lines. “That is where the problems are,” Phoumin said. “The government has to invest more. It isn't enough yet.”

Energy demand continues to grow rapidly, with an annual average increase of around 20% since 2010, except in 2020 and 2021 because of the COVID-19 pandemic crisis, which reduced the increased demand to only around 6% and 2% respectively, according to EAC’s data.

While the government has expanded solar power, thousands of megawatts of solar remain untapped.

The key concerns about scaling up solar have historically been linked to cost and to reliability, said Weatherby. “The cost issue has largely been resolved,” she said. “The remaining concern is grid stability: many utilities are concerned about variable solar and wind disrupting the electricity supply’s stability.”

“There are real changes that need to be made in order to accommodate higher amounts of solar power, given its variability—and while these can be managed initially through weather forecasting and load-demand forecasting, it does require rapid responses from the utilities in a way that traditional power from coal or hydropower does not,” Weatherby explained.

Cambodia has some of the highest potential for solar power in the region, averaging 6 to 8 hours of sunshine per day and producing daily averages of 5 kWh/m2. That’s significantly higher than its direct neighboring countries, Thailand and Vietnam, and almost double that of European countries such as Germany, according to UNDP’s report on Harnessing the Solar Energy Potential in Cambodia.

“5 kWh/m2 is a reflection of the average amount of sunlight that is available in Cambodia per unit of land to produce electricity,” Weatherby explained, “a clear indication that solar power production in Cambodia is a good investment.”

Navigating the Direction of Solar Power

Despite solar’s huge potential, experts claim underinvestment, lack of policy and insufficient energy infrastructure slow the path. ADB estimated that EDC should have invested $600 million to upgrade the infrastructure over the last five years.

The energy experts VOA Khmer interviewed explained that the government needs to secure purchasing agreements with solar power investors, operate transparent investment bidding to attract investors, and invest in upgrading energy infrastructure and battery storage. These challenges were also highlighted in a recent ADB report.

“You cannot build a solar project or coal project unless EDC signs a purchase agreement to buy the power,” said EnergyLab’s McIntosh. “What it needs is the government to commit to buy more power from solar.”

For example, she said, the government needs a policy that, say, calls for 300 MV of solar for the next few years, followed by competitive bidding and a response from investors who explain how much they can sell to the government. “Then EDC can choose the lowest price,” McIntosh said. “But without a bar, we can’t build the project.”

Phoumin said more investment was needed to upgrade infrastructure, including battery storage installment and integration, which is necessary to store solar power overnight.
Solar does have limitations because it is an intermittent resource, experts said. But it could be more fully tapped to redirect energy where it’s needed. “Floating solar could step in and provide dry-season electricity production at times when hydropower production is down due to low water levels,” Phoumin said.

ADB’s Gill added that “solar energy has to be deployed along with sufficient amounts of energy storage, and the operation of solar plants can be coordinated with other sources of energy such as hydropower and quick-responding gas engines to ensure that grid reliability and stability is maintained.”

Some of these challenges are now being addressed by the government, Gill said. The first phase of Cambodia’s national solar power project, for 60 MW, was opened to private sector bidding and resulted in the lowest procurement price for grid-connected solar power in all of ASEAN, at 3.89 USD cents/KWh, Gill said.

“Phase 2 of the project was completed in October 2021, and resulted in an even lower price, although it is yet to be publicly disclosed by the national power utility EDC, as the process is not complete,” Gill said in an email in response to VOA Khmer’s questions. “The national solar park project shows that open competition enables price discovery (and hence transparency in the sector), and leads to lower electricity prices.”

Gill noted that the Cambodian government has announced that renewable energy sources could ultimately account for about 59% of the total installed power capacity.

“Insufficient Consumption of Electricity”

Electricity has traditionally been expensive in Cambodia compared to neighboring countries, and prices historically have been higher in rural areas than in towns and cities as Electricite du Cambodge (EDC) grants licenses to investors to build transmission and distribution lines in rural areas. About 10% of grid-connected households cannot afford the electricity tariff, according to the World Bank’s report in 2018 on CAMBODIA: Energy Access Diagnostic Report.

Phoumin said the cost of basic lighting and electricity can be a major drain on family incomes. To save money for basic lighting and electricity, some rural families would choose to cut other expenses. That’s called “insufficient consumption of electricity,” said Phoumin, “which means people in rural areas are less likely to improve their economic benefit.”

Households that connect to electricity, by contrast, have a higher rate of return as they have more opportunities to generate income. “There is an inequality gap – people in rural areas pay more than people in the city,” he said.

Phoumin confirmed there is no specific data on this issue. The correlation between poverty and electricity is from sample groups in specific areas.

People living off-grid in rural areas depend on basic lighting and electricity from greenhouse gas-emitting kerosene, time-consuming charge battery systems, and high-cost diesel generators. According to the Cambodia Socio-Economic survey, 13% or 287,000 households of rural households use solar as a source of electricity.

Nhem Sico, a sales manager for Solar Home Company, which entered Cambodia’s market in 2010, says consumers’ perception on solar has changed.

“A decade ago, Cambodian people had no idea what solar was nor paid attention to it,” he told VOA Khmer. “Now more people are starting to use solar and choosing solar over electricity or fuel-generators because the cost is cheaper.”

These consumers are driven more by costs than concerns about the environment, he added.

Closing the Energy Access Gap

Residents of Cambodia’s populated cities and urban areas are frustrated by power shortages and power cuts during the dry season. But even that is a privilege residents of many isolated villages cannot relate to – the number of households living off-grid amounts to half a million.

For ‘hard-to-reach’ areas like Steung Chrov village, solar power can operate separately from national electricity transmission networks to serve a limited number of consumers. It’s a feasible option for closing the energy access gap.

Steung Chrov, with around 110 households, is about 20 kilometers from the provincial downtown. It takes a 20-minute boat-ride to get there. Most of the villagers are farmers, producing rice, soybeans, corn and sesame. But since connecting to solar, some villagers, like Chanlita, started running their own businesses in addition to farming. Some of the solar panels are on rooftops and some are next to or in front of houses. The solar project is operated by the Ministry of Mines and Energy with the UN Development Program and funded by the Swedish government.

Village Chief Ke Song said that since the arrival of solar, the amount of money villagers spend on power sources has gone down dramatically. “Previously, most villagers spent up to 30,000 riels per month,” he said. “Now they only spend 10,000 riels.”

Villagers can use electric rice cookers as well as fans, TVs, mini-refrigerators, and other machines that support their business.

“Before, people would stay inside after sunset, but now they are walking around and engaging with each other until 10pm,” Ke Song said. “We have a better and safer livelihood.”


Data used in this story


This story is supported by the Mekong Data Journalism Fellowship jointly organized by Internews' Earth Journalism Network and the East West Center.

Banner image: Houses in a remote village Stung Chrov in Baribo district, Kampong Chhnang province, are equipped with solar panels to generate solar energy into electricity, October 12, 2021/ Credit: Hean Socheata/VOA Khmer.