Cambodia has in the last 10 years undergone a dramatic industrialization and therefore a large increase in electricity demand. This has historically led to an under-supply of power and rolling blackouts in the urban centers.
Cambodia has large areas of the country that are not served by the national grid although this is currently being built out.
Cambodia has a complicated electricity-tariff system which has been changing during 2020 and 2021.
There are clear rules for power tariffs with or without solar power. There is likewise a capacity charge, thus ensuring that the utility is reasonably compensated for investments in infrastructure also after a client has installed solar power and thus requires less power from the grid.
For off-grid solutions we have a strong set-up that allows up to 90% of the power consumed to be provided by solar and batteries. The costs of solar power available also in the night is about half of diesel costs.
There is currently no framework for selling excess power to the grid under a standardized Feed-In-Tariff
Below is our advocacy advice to Cambodia published in early 2021 by Asian Vision Institute
Rooftop solar installations in the Commercial and Industrial sector (C&I) offer an excellent opportunity for adding power generating capacity with some features:
- Fast (a rooftop solar system can be commissioned within 3-5 months of agreements)
- Low/No expenditure for EdC
- Access to renewable energy for companies with international commitments
- High quality (if installed by credible companies) generator with 20+ year expected asset life to help meet growing electricity demands on the grid
- Mobilize private sector funding (reduce EdC expenditure)
Cambodian regulations on renewable energy are good for developing rooftop solar projects for three main reasons:
- The high (but still reasonable) electricity prices from EdC make rooftop solar competitive.
- The rules from 2020 are clear and fair on the economic consequences of installing rooftop solar for factories with only minor electricity demand in off-peak times.
- The rules link solar generation with electricity consumption.
This means that solar installation companies can assist government objectives of increasing clean energy and reducing electricity costs to customers in a way that is manageable by EdC.
Under the current regulations, the benefits of rooftop solar are limited to the system owners. However, a typical C&I customer does not operate on Sundays or public holidays providing the opportunity for unused solar power to be sold to EdC (we suggest a price of
6 – 7 US cents/kWh – very cheap compared to C&I electricity tariffs for consumption) and fed directly into the distribution network to power nearby load.
C&I customers paying upfront for solar installations incentivize low-cost, low-quality systems which may perform poorly and introduce a risk of electrical fires.
We are able to finance C&I rooftop installations in the entire SE-Asian region. We would appreciate that the rules on equipment leasing and performance payments on delivery of power were simplified and clarified in Cambodia, thereby ensuring high quality, reliable systems are installed and operated.