Cambodia Sustainable Energy Transition Project

pipeline

Prospective

The proposed Cambodia Sustainable Energy Transition is a multi-faceted project which provides comprehensive support to Cambodia's ambition to decarbonize its economy while maintaining stability and affordability. The proposed project is designed to respond to government priorities in the energy sector, to significantly i) upgrade the electricity grids for enhanced capacity and improved reliability and efficiency for electricity services (incl. variable renewable energy and clean power imports), ii) enable and promote strategic investment of E-mobility infrastructure; iii) drive energy efficiency investments in industry to catalyze implementation of National Energy Efficiency Plan (NEEP); and iv) expedite access to modern energy services across the country, with improved access to modern electricity services in remote unelectrified villages and clean cooking. These initiatives are imperative for fulfilling the goals outlined in the Revised Power Development Plan (RPDP), NEEP, National Policy on Electric Vehicles Development (NPEVD), National Clean and Efficient Cooking Strategy and Plan (NCECSP) and related government’s socio- economic development agenda.The proposed project will consist of three components:Component 1: Power Grid Strengthening for facilitation of Energy Transition This component will support investment in the following areas: - Investment in transmission lines and substations - Investment in AMI / SCADA integration, BESS - Distribution network extension and strengtheningThis subcomponent will finance construction of new transmission lines and substations in Phnom Penh area (and central eastern Cambodia) which aims to meet the demands of (i) electricity consumption growth and improving the reliability of electricity supply in Phnom Penh area, and (ii) increasing clean power imports from Laos. This component will finance the construction of one 230 kV transmission lines from GS Lvea Am to GS Arey Ksat (about 15 Km), and one 115 kV double circuit transmission lines from Aray Ksat to GS Chroy Chang Va III and to GS Wat Phnom (about 4.5km); with associated substations critical to service demand growth expected in the Arey Ksat area (and east of Phnom Penh). In addition, as part of the process of starting the digitizing of its grid, Cambodia aims to start with replacing all 3 phase meters including the already installed Advanced Meter Readers (AMR) with Automatic Meter Infrastructure (AMI) and the associated soft and hard infrastructure to lay the foundation for the development of a smart grid. The pilot phase of this digitization exercise is expected to be funded from this component. The component will also support BESS investment to facilitate high level of renewable energy efficiency and Strategic investment for E-mobility uptake. Further, this component will support expansion and strengthening of distribution networks in urban and rural areas to accommodate new demand, including EV deployments. Component 2: Energy Efficiency Improvement This component will support the following areas: - Credit line for investment in energy efficiency technologies industrial sector - Clean cooking The component will be be implemented by Ministry of Mines and Energy (MME). The Industrial Energy Efficiency Financing component is designed to promote the adoption of energy-efficient technologies and practices within Cambodia's industrial sector. It provides concessional loans to industrial enterprises for the purchase, installation, and operation of energy-efficient equipment, which helps reduce energy consumption and lower greenhouse gas (GHG) emissions. Key stakeholders in the program include the MME, which serves as the implementing agency, along with the Ministry of Industry, Science, Technology and Innovation (MISTI), and state-owned financial intermediaries, including Small and Medium Enterprise Bank of Cambodia (SME), and the Agricultural and Rural Development Bank of Cambodia (ARDB). These institutions collaborate to ensure the efficient allocation and utilization of financial resources to support energy efficiency investments. The financial intemediary instrument will be adopted to finance energy efficiency investment made by industrial enterprises through participating financial institutions.Only technologies from a predefined list, which is periodically updated by MME and MISTI, which meets specific energy performance standards, are eligible for financing under the project. Given its mandates in industrial affairs, MISTI would involve in the marketing of the credit line to industrial enterprises (IEs) and provide technical assistance on energy audits/assessments to these IEs provided they are recommended by participating financial institutions (PFIs).Clean cooking component aims to provide incentives for distribution, and consumers adoption of energy-efficient cooking technologies. Clean and efficient cookstoves are a transformative solution to reduce reliance on traditional biomass fuels such as wood, charcoal, and crop residues, which are not only environmentally harmful but also pose significant health risks, particularly for women and children who are most exposed to indoor air pollution. By supporting local SMEs, the program fosters economic growth and job creation while also addressing pressing public health concerns. Clean cookstoves will contribute to improved air quality and energy efficiency in households, reducing respiratory diseases and other health issues caused by the burning of solid fuels. This work will also help enhance market access for clean cooking technologies and make them more affordable and accessible to households across Cambodia. Component 3: Implementation Support- Implementation support for MME- Implementation support for EDCThis component will provide technical support to Project Management Unit (PMU) of MME. This assistance will focus on building the technical, institutional, and environmental and social (E&S) risk management capacity of the Ministry of Mines and Energy (MME), participating policy banks (ARDB and SME Bank), and other relevant stakeholders. Activities will include targeted training pipeline development/update, appraisal, and implementation of energy efficiency (EE) sub-projects; environmental and social due diligence in line with the World Bank’s Environmental and Social Policy and Standards; and guidance on credible energy accounting of energy savings and GHG reductionsAlso, the component will provide technical support to PMU at EDC for project implementation. The support will include environmental and social risk management, financial/procurement management, technical specifications and site supervision. This component will support EDC to comply with relevant WB policies (Environmental and Social standards/fiduciary), and ensure all technical design, specifications under grid component are delivered in high quality and met applicable industry standards

World Bank Group

Project

Solar, Fertilizers, Power Generation (CCGT), Automotive, Electric Vehicles (EVs), Wind, Biomass, Government, Raw Materials, Manufacturing (Industrial), Commercial