Cambodia’s Ministry of Mines and Energy has published a document outlining the principles for allowing the use of rooftop solar power plants. The new practice replaces the monthly capacity fee for rooftop systems with a tariff calculated according to a complex formula.
The changes are in response to the clothing industry’s desire to install more solar power on the roof to “reduce the carbon footprint of goods and products,” as demanded by international buyers, according to the document. The release repeatedly emphasizes the government’s belief that electricity-scale solar energy is the best way to lower electricity prices for all consumers and minimize grid instability problems. Thus, it will introduce a “rooftop solar variable energy compensation tariff” based on the principle of “electricity price fairness among all parties”.
The new tariff is calculated according to a three-part formula. The first is the price of electricity export from the national grid, which is paid to the electricity distributor. The second is a price equivalent to network losses paid to the state-owned electricity company Electricite du Cambodge (EDC). The third is a tariff based on the levelized cost of electricity (LCOE) of each installation.
Natharoun Ngo Son, country director of Energy Lab, asked if the new tariff is a positive development for solar energy in Cambodia. pv magazine ambivalent response.
“Yes and no. Yes, it’s better because the capacity charges are first capped at 50% and then the capacity charge whether you use your system or not,” Ngo Son said. allowed, and now is.
However, owners of solar PV systems that feed electricity into the grid would do so for free, as net metering and net billing are not allowed in Cambodia. Ngo Son argued that grid constraints, among other things, mean that utilities are unlikely to adopt such regulatory accelerators anytime soon.
Ngo Son expressed concern about the other end of the new tariff, stating that “no, it’s not necessarily better. The big question we all have is: We have a formula, but what does it mean? What are the real costs that the private sector will end up paying? No company will today understand what the new regulations mean in terms of cents per kilowatt-hour and thus payback period Some solar players noted that it has slowed their current operations and created uncertainty.
Although the policy document was signed and published on 25 April 2023, its official status is currently unclear as it has not been published on the website of the Ministry of Mines and Energy. Ngo Son said it is expected to be released in the coming weeks, after formal consultation with the private sector is likely to take place next week. He pointed out that the implementation schedule has not yet been announced.
The document also introduced quotas for rooftop solar installations, distributed on a first-come, first-served basis by province, provincial capital and zone. However, it does not specify how many quotas there are, how they are defined, or what the status of existing solar power systems is in the quota system.
“Upon receiving a permit from the Electricity Authority of Cambodia, the applicant must start (installing) rooftop solar power within three months from the date of notification,” the document reads.
Despite many unanswered questions, Ngo Son sees the new policy as a positive development for solar energy in Cambodia. In April, the Cambodian government approved five renewable energy projects totaling 520 MW. Four of these are solar projects, one of which is a 150 MW project in Pursat province, an 80 MW project in Prey Veng province, a 60 MW project in Kampong Chhnang province and a 60 MW project in Svay Rieng province.
Cambodia released its “Power Development Plan 2022-2024” (PDP) in December 2022, setting a solar addition target of 3,155 MW by 2040. According to the latest statistics from the International Renewable Energy Agency (IRENA), the Southeast Asian country had 456 MW of installed solar capacity at the end of 2022.