ADB advises region to combine grids

Last Updated on 31 May 2013

By Low Wei Xiang

Cambodia is expected to be able to produce about half the energy it needs by 2035, according to the Asian Development Bank (ADB), but the Kingdom – along with its neighbours – should also consider integrating their energy grids, which would bring about more competitive prices, as well as savings worth billions.

Cambodia is currently “not that far off” from meeting its projected energy self-sufficiency rate of 52 per cent in 2035, said Donghyun Park, a principal economist with ADB’s economics and research department. He was speaking at an ADB workshop yesterday on Asia’s energy outlook.

To boost its energy security, Cambodia and the rest of the Greater Mekong Subregion – Myanmar, Thailand, Vietnam, Laos and parts of China – should connect their electricity and natural gas grids, he said.

“This is a region that is very heterogeneous. Some countries are energy exporters, some are energy importers. So there are large gains from regional energy cooperation.” For example, $14 billion would be saved over 20 years by substituting hydropower for fossil fuels in the region, he said.

Another benefit is that the standardised pricings and regulations involved would result in a “more competitive energy market”, he added. High energy prices, as well as sudden power cuts, are common complaints among investors in Cambodia.

But Park said such market integration faces resistance. “It’s difficult because electricity [supply] tends to be a monopoly,” he said, and “to embrace new regulations and prices erodes the market power” for the supplier.

Electricite du Cambodge’s director general, Keo Rottanak, said last week that “ASEAN countries, including Vietnam, Thailand, Laos and others, are facing a shortage in their power grids”, presenting a challenge to regional integration.

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