Event Reports

Cambodia’s Energy Transition

by Peter Hefele

Presentation of a Research Study

Rapid economic development, a young and fast-growing population, severe impacts of climate change and the aim of providing stable and affordable energy and consumption in a sustainable way: These challenges lay at the heart of any discussions on sustainable development in South East Asia. Cambodia, still one of the poorest countries in ASEAN, is a good example in this respect.

Currently Cambodia's energy mix consists for over 50% of imported energy, mostly petroleum products, coal and electricity. As accessibility to a low-carbon energy sources increases – due to declining costs of renewable energy sources such as PV and wind – there are new options for a future energy system in Cambodia.

In August 2017 and March 2018 the Cambodian think tank Enrich Institute released two in-depth analysis of the existing energy system in Cambodia, including recommendations on how to comprehensively transform it towards a low- carbon one.

The main findings of this research, which was funded by the Regional Project Energy security and Climate change Asia-Pacific (RECAP), were presented to domestic and international experts during an workshop in Phnom Penh on 14 March 2018.

Dr. Peter Hefele, RECAP Director, outlined the overall situation of energy politics in ASEAN. He pointed out that domestic reforms and regional integration are mutually dependent if potential economic gains shall be fully achieved.

In his presentation, the author of the study, Dr Heng Pheakdey, founder and director of Enrich Institute, summarized the main findings and recommendations of both parts of the research study.

To fasten up the transformation of Cambodia´s energy system, the following issues have to be addressed and decisive steps to be made by politics and business:

  • Setting a clear and legally binding national targets for the use of Renewable Energies (RE)
  • Creating an competitive and open energy market
  • Introducing economic incentives, such as fed-in tariffs or other subsidies
  • Improving the access to investment capital through the domestic banking system
  • Exploring alternative financing models, such as green bonds or tax cuts
  • Clarifying the legal framework of connecting residential, commercial and industrial solar producers to the existing electricity grid
  • Streamlining the licensing policy for RE projects
  • Improving professional skills to increase employability in the green sector
Part 2 of the publication will be published soon and will be available online.