Co-operation on the exchange of electricity will be very important in making the 10-country ASEAN bloc move forward to a single market by 2015, experts said, but a shortage of power supply in each country remains a challenge.

Speaking to reporters yesterday after the opening of the 29th meeting of the Heads of ASEAN Power Utilities and Authorities Council, Keo Rottanak, director general of Electricity of Cambodia (EDC), said the population and economic growth rates are rising in ASEAN, which is why more energy supply is needed.

“All ASEAN countries including Vietnam, Thailand, Laos and others, are facing a shortage in their power grids, but their issues are less than for us,” said Keo Rottanak. “A shortage of power supply is truly a challenge [for regional integration].”

While the general development gap is a challenge in forming one single economy which allows the free flow of goods, services and labour among all countries in ASEAN, Ith Praing, secretary of state at Cambodia’s Ministry of Industry, Mines and Energy, said Cambodian infrastructure is still at an early stage of development and is being constructed piece by piece.

“The participation by the private sector has been an indispensable element in addition to the regional and bilateral framework,” Ith Paing said.

Hiroshi Suzuki, CEO and chief economist at the Business Research Institute for Cambodia, said the member countries in the region, and donors, have made great efforts toward the physical connection of power systems, especially among the Great Mekong Sub-region countries.

He added the connection of transmission lines between Thailand, Vietnam, Laos and Cambodia have been constructed and are operating to some extent.

“The supply capacity and price could be much more efficiently managed by these efforts,” he said.

According to a report in 2011 conducted by the ASEAN Center for Energy, Cambodia’s electricity tariff is one of the most expensive in the Southeast Asian region. Tariff rates range from 9 cents to 25 cents per kilowatt hour for the EDC grid, and 40 cents to 80 cents per kilowatt hour for rural areas.

The report revealed that on average electricity prices for industrial consumers range from 11.71 cents to 14.63 cents, which is the highest among ASEAN economies.

In a meeting at the Cambodia Chamber of Commerce last week on the private sector development focusing on the rice sector, rice millers said high operational costs due to electricity prices are a major obstacle in driving higher production costs and negatively affecting their competitiveness in the market.