Cambodia is set to receive $73 million in financing from the Asian Development Bank (ADB) for energy sector development – “a $50 million policy-based loan package with $23 million in project investments”.
ADB on December 15 announced that it had given the nod to the financing package, noting that the accompanying Energy Transition Sector Development Program – formerly the Energy Efficiency Sector Development Program – “includes ADB’s first comprehensive policy reform package for the energy sector in Cambodia”.
The policy reform package “will be funded by a $40 million loan from ADB’s concessional resources and a $10 million loan from the ASEAN Infrastructure Fund under its ASEAN Catalytic Green Finance Facility [ACGF]”, the Metro Manila-based multilateral lender said in a statement.
“For the $23 million in infrastructure investments, the Climate Investment Fund’s Scaling Up Renewable Energy Program for Cambodia will provide a $6 million loan and $5 million grant in concessional climate finance, while the Green Climate Fund will extend a $12 million loan through the ACGF Green Recovery Program, all of which will be administered by ADB.
“The programme supports the [government’s] energy transition agenda to mainstream renewable energy and energy efficiency while shifting away from fossil fuels. It adopts data-driven regulation and planning for the power system to enhance flexibility and resilience, and anchors new infrastructure investments on strategic planning while demonstrating new technologies and business models,” the statement said.
Pradeep Tharakan, ADB unit head for sovereign energy operations in the Greater Mekong Subregion, said in the statement: “The programme combines policy reforms and project investments that will mutually support each other to maximise gains.
“This is expected to pave the way for public and private sector investments in critical new technologies, such as energy efficiency and storage. It will also help set clean energy targets for the country, and integrate improved power development and energy-use planning across sectors, including climate proofing critical infrastructure,” he said.
Similarly, on November 2, ADB revealed that it had signed a “transaction advisory services mandate” with national utility Electricite du Cambodge (EdC) to “support the development” of an additional 2GW of solar power capacity in Cambodia.
The EdC is set to carry out a nationwide study on ways to harness the extra solar power capacity, to come from a massive undertaking – expected to spur up to $100 million in investments – that aims to illustrate how to quickly and efficiently procure low-cost renewable energy in Cambodia towards its vision for carbon neutrality by 2050.
And on November 11, an ADB-backed 60MW solar photovoltaic (PV) power plant, a part of the 100MW National Solar Park in southwestern Kampong Chhnang province, was connected to the national grid, as reported by the bank.
The December 15 statement added that the $23 million in project investments would also encompass “comprehensive city-level efficient street-lighting systems in Kampot and Kep provinces, which will demonstrate cost savings and benefits for tourism and public safety.
“Through the policy reforms, renewable electricity generation by 2027 is expected to increase by at least 25 per cent from a baseline of 4,672 gigawatt-hours in 2021.