Chinese investment in energy creates new history for Cambodia: Cambodian minister

PHNOM PENH - Cambodian Minister of Mines and Energy Suy Sem said that Chinese investment in developing hydropower plants and power transmission lines has built a new history for Cambodia.

"Energy development is very important for Cambodia," he told Xinhua in a recent exclusive interview. "Chinese investment in developing the sources of electrical energy is like the building of a new history for Cambodia."

Due to internal conflicts, Cambodia had no electricity for use in the past, he said. Under the Prime Minister Samdech Techo Hun Sen's win-win strategy, the wars totally ended in 1999 and infrastructures, especially electrical energy, have been begun to develop from scratch.

The minister said under the cooperation with the People's Republic of China from 2000 until now, six hydropower dams had been already built and the construction of the seventh one, Lower Sesan II hydropower plant, with a capacity of 400 megawatts, has been built for about 70 percent.

The seven plants totally cost around $2.4 billion.

"All hydropower plants in Cambodia are 100 percent invested by Chinese companies, except the $781 million Lower Sesan II project that is a joint venture among Chinese, Cambodian, and Vietnamese companies. However, the Chinese firm holds 51 percent, Cambodian firm controls 39 percent, and Vietnamese company 10 percent," Suy Sem said.

He said currently, the six hydroelectric plants have produced a total of 928 megawatts, representing 47 percent of the electricity available in Cambodia.

"To date, 72 percent of the kingdom's villages have access to electricity," he said, projecting that all the villages in the country would have electricity by 2020.

"Energy sector in Cambodia needs to lean its destiny on Chinese investment, and if there is no Chinese investment, until now, we will not have electricity as we see today," said Suy Sem.

He called on Chinese investors to help build more hydropower dams, coal-fired power plants, power transmission lines in Cambodia, saying that the electricity demand goes up about 20 percent every year.

Commenting on the advantages of hydropower plants, the minister said hydropower dams are the source of clean energy and reduce Cambodia's reliance on oil-fueled power plants and electricity imported from neighboring Vietnam and Thailand.

"Hydropower plants have built independence in electrical energy for our country and help lower the prices of electricity," he said. "In addition, the government has earned tax revenue from those hydropower plants."

Meanwhile, Suy Sem highly appreciated Chinese workers and technicians at all hydropower plants in Cambodia for their techniques, experience, and hard-working spirit.

"None of the projects had been completed later than schedule. Some projects had been completed up to half year earlier," he said. "I evaluate that besides Chinese people, those projects may not be easy to achieve and the (construction) cost may be higher."

The minister also touted Chinese companies for their strong commitment to fulfilling their projects even during the global economic crisis.

He added that all Chinese companies have fully complied with the conditions stated in the project agreements they signed with the government and are well-cooperated with the Ministry of Mines and Energy.

"I am satisfied with their respect for the agreements...and will continue to offer them good cooperation," he said.

According to Suy Sem, the hydropower plants have been built under the concessional contracts of BOT (Build-Operate-Transfer), so when their operation or business period is ended, the plants will be transferred to the Cambodian government.

He said that during the business period, it is essential for the companies to help train Cambodian workers so that they will be able to continue managing the plants when the companies leave.

Sharing his view on the Sino-Cambodian cooperation in energy sector under the Belt and Road Initiative, the Cambodian minister said the initiative, backed by the Asian Infrastructure Investment Bank (AIIB) and the Silk Road Fund, is a strategic policy for enhancing cooperation between China and other countries.

He said the Cambodian government has supported this initiative and the country is also one of the AIIB's founding members.

"We will be able to borrow money from the bank for developing infrastructures including energy sector," he said.

He added that the seven hydropower plants, power transmission lines and sub-transmission lines in Cambodia were born from the OBOR initiative.

"I suggest that our cooperation under the Belt and Road Initiatives continue because our development of power transmission lines has now reached 72 percent of the villages in Cambodia and is expected to cover all villages in the country by 2020," he said.

Asked about the development of solar energy in Cambodia, Suy Sem said that high cost is a key challenge for Cambodia to develop the solar energy.

"The development of solar energy is also in our plan because it is a renewable and clean energy, but its price is very expensive, low-end consumers cannot afford it," he said. "We will focus on it when the cost is cheaper."

However, the minister said the government last month awarded Singapore's Sunseap Asset (Cambodia) to build Cambodia's first large-scale solar power plant in Bavet City of southeastern Svay Rieng province. The $12.5 million solar farm will feed 10 megawatts into the national grid when the construction is completed during the first half of 2017.