Living in Cambodia, you cannot help but be reminded on a daily basis that this country has an incredible solar resource. But, to date, Cambodia has done little to harvest that sun to make energy. Solar provided only 5% of the country’s energy in 2023 – much less than hydro or coal power, which provided 46% and 48% respectively.

However, this is about to change, with Minister of Mines and Energy Keo Rottanak announcing a major realignment in Cambodian energy policy late last year. The government has announced that it will double the amount of new solar power to be built this decade, with 2 gigawatts (GW) to come online by 2030 – a clear sign that they are ready to solve any technical challenges that held them back previously.

The Government has also announced that it will significantly expand storage capacity, promising to build 1GW of new pumped hydro by 2028. Finally, the government has cancelled a new 700 megawatts (MW) Coal Power Station, which was to be built in Koh Kong province, a pristine wilderness in Western Cambodia. 

This is an enormous step in the right direction – and shows that solar will power the future and that coal is all but finished as a viable source of new energy.

For years, solar power has been dismissed in Cambodia as being both too expensive and too unreliable. But the cost of solar has fallen by almost 90% in the last decade, and as a result we have never seen energy that can be produced as cheaply as it can with solar power.

With this announcement, Cambodia is finally ready to take advantage of solar – reshaping the country’s energy future, greatly improving its attractiveness to international investors and significantly improving the country’s energy security by reducing exposure to volatile global markets.

Dialling up large-scale solar is also vital to the country’s economic competitiveness. Cambodia’s current solar rooftop policies mean that companies are limited in how much solar they can feasibly install on their own building. 

Therefore, companies looking to reduce their emissions need to rely on more solar being installed across the whole grid, if they are to produce their products with less emissions. This will only become more important as climate change commitments are given ever greater weighting in global investment decisions. 

Accelerating action this decade is also vital to achieving the Paris climate goals, and how we get to net zero is just as important as when we get to net zero. Carbon emissions stay in the atmosphere for hundreds of years, so with every tonne of unnecessary fossil fuels burnt we make the problem worse. Even if Cambodia can reach its net zero target by 2050, today’s new fossil fuels will cause immense damage by increasing the total amount of carbon emissions. 

Having set an ambitious direction, the government now has the formidable task of implementation. The first challenge will be to update the Power Development Plan (PDP), which is the detailed roadmap that Cambodia uses for its energy system.

There is also a strong case to expand the scope of the PDP to create an ambitious, comprehensive roadmap that brings together the opportunities and the challenges in the energy transition – from managing the rise of electric cars and electrification to exploring options to actively reduce the amount of fossil fuels required in the grid. 

Cambodia will also have to carefully manage new investments in gas powered generation. The energy minister announced a new 800MW Natural Gas Power Plant in place of the cancelled coal power plant. Building this plant will be a herculean task, requiring a new port to bring in gas from a globally constrained market. But it will be equally challenging to contract the plant in a way that does not crowd out renewable energy.

A good start would be to select gas technology that is flexible and can quickly ramp up and down to fill in gaps from solar power output. For example using Combined Cycle Gas Turbine – which needs to run flat out to justify its higher cost, is unlikely to complement the free renewable energy from Cambodia’s sun.

But these challenges are good problems – they are a sign that the energy transition is now apace in Cambodia, and that there is plenty of scope to get the policies right. 

EnergyLab has been working since 2018 with a range of partners to deliver this ambition, and in 2024 there is incredible scope to make significant advances in Cambodia’s clean energy transition.

EnergyLab Cambodia is a not-for-profit organisation working to support the growth of clean energy.

The views expressed are those of the author.