Representatives from the Konrad Adenauer Foundation, the Ministry of Environment and a handful of climate advocates met in Phnom Penh yesterday to brainstorm ways the country can transition to a “sustainable energy future”.
Peter Hefele, head of Asia’s energy security and climate change at the Konrad Adenauer Foundation, said yesterday that a transition to renewable forms of energy was “the biggest issue we focused on” but noted that, in order to get these energy projects off the ground, Cambodia’s energy sector’s regulatory framework would need to be retooled.
Currently, control over Cambodia’s electrical grid is centralised, but it would have to be opened up to introduce renewables into the picture. Micro-grids that run off of solar panels, for example, would need to be developed in remote areas that are now disconnected.
“Solar and biomass energy will be especially important in the remote areas of Cambodia,” Hefele said. “Wind opportunities are limited, but biomass is very important for an agricultural society.” However, he added, financing is still an issue for many of these projects.
“It’s easier to get a loan for $500 million for a coal-fired power plant than it is to get a $500,000 loan for a solar project,” he noted, adding that private investors are often very reluctant.
With that in mind, the government should take out loans and invest its own money to subsidise solar and biomass projects, he said.
“There is still a gap with pricing, so private-public partnerships could be an option. The ADB [Asian Development Bank] and the European development banks are interested in financing green energy,” Hefele noted. “But it will need five to 10 years of support and subsidisation.”
There is consensus that large hydropower projects and coal-fired power plants – which the Kingdom has long pursued – are detrimental for the environment, and that developing countries could leapfrog the pitfalls faced by many developed nations by adopting greener technology to meet their growing energy needs.
However, energy expert Paul Chapman, executive research director of the consultancy AARN Global, said Cambodia’s government is heading in a different direction.
“The government has an ambitious plan to build out the centralised grid, but micro-grids could disrupt that,” he said. “Micro-grids are harder to control and that’s a risk for the government.”
Instead, Chapman said the government often focuses on big energy projects that rely on hydropower or coal and can easily be integrated into the central grid. Solar power could eventually be used in the grid, too, Chapman noted, but it would require complicated engineering skills currently unavailable in Cambodia.
But when asked whether Cambodia’s government appeared prepared to invest in speeding up the transition to clean energy, Hefele said there is “a lot of debate” happening now.
“But I always emphasise that they have to find their own solutions,” he said. Other countries have done this and they can avoid some of the pitfalls from other countries.”
Ministry of Environment officials declined to comment.
Additional reporting by Bun Sengkong