The ADB has approved a US$730,000 technical assistance grant to Cambodia to prepare a power transmission project for the Greater Mekong region. The grant will develop feasibility studies that will allow international power transfers, and stimulate economic growth and reduce poverty across the country.

The six countries of the Greater Mekong region, Thailand, Cambodia, Vietnam, Laos, China and Myanmar, signed an agreement in November 2002 to develop a master plan to boost power supply efficiency and improve power interconnection.

The plan included an immediate transmission link between Phnom Penh and Chau Doc substation in southwest Vietnam, said the ADB.

Interconnection with Vietnam to serve load centers in Phnom Penh and southeastern towns will reduce the average cost of generation, as well as promote subregional cooperation in the Mekong basin.

“The challenge for Electricit√© du Cambodge (EDC), the state power firm, is to continue to develop new sources of power generation, and improve operation of existing systems, to reduce the average cost of supply,” said Michael Bristol, an ADB project engineer.

“Despite its limited financial resources, the government’s objective is to improve and efficiently expand electricity supply throughout the country.”

The assistance will update a 2001 feasibility study for a 220 kilovolt transmission line from the Vietnamese border to Phnom Penh, including substations at Takeo and western Phnom Penh.

It will also assess how to provide villages along the route with low-voltage electricity, and rehabilitate and expand the generation and distribution systems in selected provincial towns.

In addition, the study will evaluate training needs of EDC staff in the management, operation and maintenance of high-voltage systems.

Ravaged by 20 years of civil war and neglect, Cambodia’s power system has been unable to supply the demand for electricity by conventional grid connections.

“The power sector is highly uneven, with an electrification ratio of 65% in Phnom Penh and 27% in other towns, which have a considerably higher poverty incidence,” said Mr Bristol.

Isolated power grids are supplied mostly by small- and medium-size diesel generators and operated by private enterprises.

At present, electricity supply comprises at least 22 licensed small isolated systems and numerous unlicensed ones. With 13% of households and only 7% of rural households estimated to be electrified, Cambodia’s electrification ratio is among the lowest in Asia.

Electricity demand continues to grow at 10%-12% per annum, with most of this growth in the Phnom Penh area.

Steep tariff increases in 1999 led many Phnom Penh customers to opt for self-generation.

Construction of a transmission line to import power from Vietnam is expected to reduce the average cost of supply to enable EDC to improve its financial position and at the same time to provide more competitive tariffs and increase reliability to attract back customers and pave the way for industrial and commercial development.

Electricité du Cambodge is the executing agency for this TA, which is scheduled for completion by February 2004.