Cambodia currently generates more than 90% of its current installed energy capacity by burning expensive imported diesel fuel, and makes up for the remaining shortfall by importing electricity from Thailand and Viet Nam.2 In 2010 imports made up over 40% of the country’s total supply.3 However, this situation is set to change as Cambodia is promoting exploration in coal and natural gas, and championing investment in the hydropower sector. Developing the energy sector along these lines is a key priority of the country’s National Strategic Development Plan for 2009-2013.
Power generated by Cambodia’s proposed hydropower projects will not only be used for domestic consumption, in particular, Viet Nam hopes to develop projects in the northeast and export a share of the power generated back to the Viet Nam national grid in order to meet its rapidly growing demand for power.
A number of foreign private and state owned companies are currently conducting feasibility studies for hydropower projects in Cambodia along the Mekong mainstream and its tributaries, and a number of projects are already under construction. The Chinese built Kamchay hydropower plant is expected to go online in December 2010, and at 193MW is set to be Cambodia’s first functioning large-scale hydropower plant.
Prospects for Cambodian hydropower
In 2003 a National Sector Review for hydropower was prepared by the Ministry for Industry, Mines and Energy (MIME) and the Cambodian National Mekong Committee (CNMC). This report identified 60 possible sites for hydropower development in Cambodia and estimated the country’s total generation potential at 10,000MW, of which 50% is on the mainstream Mekong, 40% on its tributaries and 10% in the southwest outside the Mekong basin. 4
As Cambodia does not yet have the financial or technical capacities to design, construct and operate large-scale hydropower projects, all large-scale projects currently under development are under Build Operate Transfer (BOT) agreements of 25 years and upwards. At present there are five projects under development, Kamchay (193MW) in Kampot, and the Kirirom III (18MW), Lower Russei Chrum (338MW), Stung Tatay (246MW), and Stung Atay (120MW), all in Koh Kong. All five of these projects are being developed by Chinese companies at a combined cost of over US$1.6 million, and set to generate over 900MW of power.5
Korean and Chinese companies are studying the feasibility of dams in Battambang and Pursat, and the northeast of the country is also now opening up to hydropower as another large scale hydropower project on the Sesan River was approved in 2011. Starting in 2010, the Lower Sesan 2 is set to be developed by a joint Vietnamese-Cambodian venture at a predicted cost of over US$800 million, and with an installed capacity of 400MW. A number of other projects in the northeast are currently being studied for feasibility, including the Lower Sesan 3, Lower Sesan 1/5, Lower Srepok 3 & 4, and Prek Liang 1 & 2.
Two mega dams have also been considered on the Mekong mainstream at Sambor (465MW) and Stung Treng (980MW), however, there is considerable controversy related to the development of mainstream dams. In 2010 the Mekong River Commission issued a report that recommended a 10 year moratorium on Mekong mainstream dams, and there has been widespread public opposition to the huge proposed mainstream Xayaburi dam in Laos. The governments of Cambodia and Viet Nam have both publicly called for the project to be postponed until further studies have been conducted into the potential impacts of the project. It remains to be seen if Laos and Cambodia will move ahead with the controversial decision to dam the mainstream Mekong.
It is not only power generation that is in need of development in Cambodia, but also power transmission. At present Cambodia has no comprehensive national grid, but there are plans to connect the various population centres and power generation projects by high-voltage transmission lines. The Asian Development Bank and World Bank are funding a number of these connections, while others are being developed by the private sector under BOT agreements. Below is a map of Cambodia’s proposed transmission grid:6
Legal framework and regulation for granting mining licenses
The main government ministry responsible for the development of the Cambodian hydropower sector is MIME.7 Other key ministries include the Ministry of Water Resources and Meteorology (MOWRAM) and the Ministry of Environment (MoE). The State power company Electricity du Cambodge (EdC) is responsible for day-to-day aspects of management of the electricity sector and the Electricity Authority of Cambodia (EAC) for issuing generation and transmission licenses.
There is currently no law on hydropower in Cambodia, although, there are a number of laws with relevance to the development and running of such projects, including the laws related to investment, electricity, land, forests, water resources and the environment.
The first step in developing a hydropower project is to seek a Memorandum of Understanding with MIME in order to conduct and prepare a feasibility study, which can typically take one to two years to complete. After completion of the study a company may enter further discussion with MIME about developing the project.8 All projects with investment of over US$50 million and all BOT projects must be approved by the Council for the Development of Cambodia (CDC),9 which is the highest decision-making body for private and public sector investment in Cambodia.10 In addition, under the Law on Water Resource Management, all hydropower projects require a water use license from MOWRAM.11
Key provisions of the Land Law include the protection of private ownership, and the stipulation that no one may be deprived of ownership unless it is in the public interest, and only after the payment of fair and just compensation in advance.12 This is also set out in the Constitution of Cambodia.13 Unfortunately, many Cambodians still lack recognition of full ownership of their properties as they are yet to receive full land titles. This has in many cases left people exposed to land disputes and often puts people in a weak position when their land is targeted for development. However, if the occupation and/or use of the land meet a number of requirements set out in the law, and if possession initially commenced prior to the passing of the 2001 Land Law, people without land titles may still be regarded as legal possessors. Under the law possessors have rights similar to those of owners until such time as they are able to obtain title.14
All hydropower projects must be subject to an Environmental Impact Assessment prior to approval,15 and EIAs should be conducted according to the procedures set out by the MoE.16 The law makes it clear that affected people should be able to participate in the EIA process and have their input and suggestions considered.17 The Forestry Law adds to this that the law should be “implemented to ensure public participation in any government decision that has the potential for heavy impact on concerned general citizens, livelihoods of local communities and forest resources of the Kingdom of Cambodia.” It also states that EIAs “shall be made available for public comment.”18 Completed EIAs must be submitted to the MoE who will consider whether or not the report is adequate and make recommendations. The findings of the EIA should be considered in the final decision whether or not to approve a project.
Emerging trends
As the hydropower sector in Cambodia is still in the early stages of development it is not clear what trends will emerge. Likewise, it is still unclear if and how the benefits will be realized and whether or not impacts will be adequately mitigated.
It is clear that many of these large hydropower projects will flood large areas of land, for example, the Lower Sesan 2 will flood more than 340km2. Many of the proposed sites are in forested areas with rich biodiversity and sensitive eco-systems, which stand to be severely impacted by this type of development. Impacts on fish migrations and access to forest products threaten to harm the livelihoods of local people, as does the inundation of agricultural and residential land.
Large hydropower projects by their very nature will inevitably have considerable impacts on the environment, and must therefore be subject to adequate impact assessment, and if approved must have appropriate mitigation measures in place to reduce any negative impacts. One concern raised by various observers is that the EIA process is still not adequate to deal with proposals for large scale dams, public consultation is inadequate, and in some cases EIAs are not completed until well after a project has commenced.
Prospects for the future
The Cambodian energy sector is in need of considerable development, both in terms of generation and transmission, if it is to meet the growing needs of its population and in order to provide a stable and affordable power supply to attract potential investors. Hydropower is seen by the Royal Government of Cambodia as a priority area for development of the energy sector, and has backing from the highest levels. Over recent years investors and developers from China, Viet Nam, Korea, Russia, Canada and Japan have all studied the opportunities for hydropower development in Cambodia, and the first large-scale project will not go online in December 2011.
As development of the sector gathers pace, concerns have been raised by civil society and a number of communities affected by hydropower projects that inadequate attention is being paid to the negative impacts and public consultation is inadequate. High quality Environmental Impact Assessments and open decision making are crucial to ensure that the Cambodian hydropower sector is developed in a way which minimizes harms while maximizing the benefits for Cambodia and its investors.
October 2011
Links
- http://www.mime.gov.kh/
- http://www.mrcmekong.org/
- http://reta.3sbasin.org
- National Sector Review 2003: Hydropower
- The Constitution of the Kingdom of Cambodia
- Land Law 2001
- Forestry Law 2002
- Law on Environmental Protection and Natural Resource Management 1996
- Sub-decree No72 on Environmental Impact Assessment Process 1999
- Prakas on General Guideline for Writing a Preliminary and Final Report on Environmental Impact Assessment 2009
- Law on Investment in the Kingdom of Cambodia 1994
- Sub-decree on the Organization and Functioning of the Council for Development of Cambodia (CDC) 1995
- Law on Water Resource Management 2007
1 Presentation by Victor Jona, general Department of Energy, Ministry of Industry, Mines and Energy, Cambodia Energy Status and its Development, 16 March 2011.
2 Presentation by Chea Piseth, Hydroelectricity Department of the Ministry of Industry, Mines and Energy, National Power and Hydropower Development Plans in Cambodia, 16-17 July 2009.
3 Presentation by Victor Jona, general Department of Energy, Ministry of Industry, Mines and Energy, Cambodia Energy Status and its Development, 16 March 2011.
4 Cambodia National Mekong Committee (prepared by MIME), National Sector Review 2003: Hydropower, June 2003 (p5, 8-9).
5 http://www.investincambodia.com/power.htm
6 Presentation by Victor Jona, General Department of Energy, Ministry of Industry, Mines and Energy, Cambodia Energy Status and its Development, 16 March 2011.
7 Electricity Law 2001, Article 3.
8 Middleton, C. Cambodia’s Hydropower Development and China’s Involvement, International Rivers and Rivers Coalition of Cambodia, Phnom Penh, January 2008.
9 Sub-decree on the Organization and Functioning of the Council for Development of Cambodia (CDC) 1995, Article 9.
10 Law on Investment in the Kingdom of Cambodia 1994, Article 1.
11 Law on Water Resource Management 2007, Article 12.
12 Land Law 2001, Articles 4 & 5.
13 Constitution of the Kingdom of Cambodia, Article 44.
14 Land Law 2001, Chapter 4.
15 Law on Environmental Protection and Natural Resource Management 1996, Article 6; Sub-decree on Environmental Impact Assessments Process 1999, Annex.
16 For more detail see: Prakas on General Guideline for Writing a Preliminary and Final Report on Environmental Impact Assessment 2009.
17 Sub-decree on Environmental Impact Assessments Process 1999, Article 1.
18 Forestry Law 2002, Article 4.
