ASIAN INSTITUTE OF TECHNOLOGY

Capacity Development for the Clean Development Mechanism, Phase I

Mission Report: Cambodia

(21-23 October 2002)

Prepared by: Prof. S.C. Bhattacharya and Dr. S. Kumar

Energy Program, AIT

October 28, 2002

Bangkok, Thailand


Capacity Development for Clean Development Mechanism

Mission Report: Cambodia (21-23 October 2002)

1. Objective:

The United Nations Environment Programme Collaborating Centre on Energy and Environment (UCCEE) has been contracted by United Nations Environment Programme (UNEP) to implement the project “Capacity Development for the Clean Development Mechanism”. The project aims at 1) generating in participating developing countries a broad understanding of the opportunities offered by the Clean Development Mechanism, and 2) developing the necessary institutional and human capabilities that allows them to formulate and implement projects under the CDM. Twelve countries (from Asia, Cambodia, the Philippines and Viet Nam) have been selected to participate in the project.

The objective of the mission to Cambodia was to:

(i)  identify a national focal point agency;

(ii)  to take stock of past and present activities on CDM, and

(iii)  to assess the need for capacity development.

2.  Brief description of the mission

The country mission to Cambodia for this project was carried out during October 21-23, 2002 by Prof. S.C. Bhattacharya and Dr. S. Kumar of AIT. Mr. Tin Ponlock, National Coordinator of the Cambodia Climate Change Enabling Activity Project (UNDP-GEF funded project) was the contact person for the mission and greatly assisted the team in arranging meetings with the various stakeholders.

The team discussed with stakeholders from the following organisations: Ministry of Environment, Ministry of Industry, Mines and Energy (Technical Energy and Energy Development Departments), Asian Development Bank, UNDP, Institute Technology of Cambodia, The NGO Forum on Cambodia and Electricity of Cambodia.

Summary of findings/assessments in relation to the objectives:

(a)  National focal point:

The Ministry of Environment is the primary organisation that carries out Climate Change related activities in Cambodia and suited to be the national focal point and contact person. However, the other organisation that could be very much involved in the project is the Ministry of Mines, Industry and Energy.

(b)  Past and present activities on CDM, and related issues:

The energy consumption in Cambodia is low. Cambodia accessed the Kyoto Protocol in August 2002. The UNDP/GEF funded Cambodia Climate Change Enabling Activity project is the only project on Climate Change in Cambodia initiated in 1999 and has prepared the first communication under the UNFCCC. Other projects activities that have been carried out include the UNITAR sponsored a “Building Human and Institutional Capacities to address Climate Change issues in least developed countries” in Cambodia, the ADB sponsored Promotion of Renewable Energy, Energy Efficiency and GHG Abatement (PREGA) project, the World Bank/MIME project on Cambodia Renewable Energy Promotion (under development).

A National Climate Change Steering committee is being set up to address the Climate Change issues in the country comprising Ministry of Environment, Ministry of Water Resources, Ministry of Industry, Mines and Energy, etc. This committee is also expected to address CDM related projects.

(c) Need for capacity building

Discussions with the various personnel both in government and other organisations indicated that the awareness on CDM is low, and training for government and private sector is a definite need. Considering that Cambodia has recently ratified the Kyoto Protocol, the present project is timely.

There were strong reservations regarding the time frame of the project, considering the situation in Cambodia. Indications are that the preparation of a national work plan will require detailed discussions with the various stakeholders, and even a time frame of 4-6 months were mentioned.

(Initial) National Contact Person:

Dr. Mok Mareth, Minister of Environment, #48, Samdech P, Sihanouk Avenue, Tonle Bassac, Chamkarmon, Phnom Penh, Cambodia. Tel.: 023 213 908; Fax: 023 215 925. Email:

Mr. Tin Ponlock, National Project Coordinator, Cambodia Climate Change Enabling Activity project, Ministry of Environment, #48, Samdech P, Sihanouk Avenue, Tonle Bassac, Chamkarmon, Phnom Penh, Cambodia. Tel.Fax: 023 218 370. Email:

Notes of discussions with various stakeholders:

21 October 2002:

Institute Technology of Cambodia (ITC): Ms. Sackona, Deputy Director

Ms. Sakona welcomed the team warmly and was enthusiastic about ITC's participation in the CDM project. However, ITC has no ongoing activity directly linked to climate change or CDM. It is currently involved in a regional research programme on Renewable Energy Technologies in Asia funded by the Swedish International Development Cooperation Agency (Sida) and coordinated by the Asian Institute of Technology; the activity carried out in Cambodia within the umbrella of the regional programme was basically on solar drying. It also offers a regular course on renewable energy to its students. Ms. Sackona suggested that the Ministry of Environment would be the logical choice as the contact for the CDM project in Cambodia.

22 October 2002:

Ministry of Environment: Minister of Environment; Deputy Director General; Director, Education and Communication; National Project Coordinator, Cambodia Climate Change Enabling Activity project.

The Minister warmly welcomed the team and informed that Cambodia was very much keen in participating in the project “Capacity Development for the CDM”, which will help develop capacity in the country. Cambodia accessed the Kyoto Protocol in July 2002, and is in force since August 2002. So, the project is very timely. He also informed that a UNDP-GEF sponsored Cambodia Climate Change Enabling Activity project was initiated in 1999 as a first step with respect to UNFCCC activities in Cambodia, and a second phase is expected to commence in 2003.

He informed that some results from the project are now available, but are mostly in the forest sector. There is a large potential to develop renewable energy, especially in micro hydro, solar and wind. The Prime Minister is also interested in promoting solar in schools, hospitals and bridges. With regard to energy efficiency, a project with the World Bank studied the lighting systems in buildings. Some work is also carried out on biogas by NGOs. He felt that choices of energy supply and prioritisation of activities need to be done regarding the forest, wetland, use of gas, hydro power, energy conservation, development of clean energy and cogeneration, and observed that management of energy systems can be improved.

National Project Coordinator, Cambodia Climate Change Enabling Activity Project.

Mr Ponlock informed that Cambodia is one of the first countries in SE Asia to ratify Kyoto Protocol, and there is a strong commitment and political will. The government is also working on the institutional settings to address the Climate change issues. A National Climate Change Steering committee is being set up to address the Climate Change issues in the country comprising Ministry of Environment, Ministry of Water Resources, Ministry of Industry, Mines and Energy, etc. This committee is also expected to address CDM related projects. However, at the present time the capacity to address Climate Change issues in Cambodia is low. This needs to be strengthened, both technical and regulatory. In Cambodia, the government is the key player, and awareness is not high; also the private sector has not been involved in any such activities.

A project “Cambodia Climate Change Enabling Activity project” was initiated in 1999 with the objective of preparing the First National Communication in response to the UNFCC, and this has been submitted in August 2002.

Many documents, including the Cambodia’s initial national communication under the UNFCCC were provided to the team.

Climate change and GHG reduction related activities carried out in the country include the following:

(a)  The UNDP/GEF funded Cambodia Climate Change Enabling Activity project is the only project on Climate Change in Cambodia.

(b)  UNITAR sponsored a “Building Human and Institutional Capacities to address Climate Change issues in least developed countries” in Cambodia.

(c)  ADB sponsored Promotion of Renewable Energy, Energy Efficiency and GHG Abatement (PREGA) project is still in the initial stage, and a kick off workshop was held in September 2002.

(d)  World Bank/MIME are developing a Cambodia Renewable Energy Promotion project.

(e)  The New Energy and Industrial Technology Development Organisation (NEDO) is considering Climate Change related projects under the CDM.

Asian Development Bank: Deputy Head, Cambodia Resident Mission

Mr Jude, Deputy Head, Cambodia Resident Mission of ADB noted that the Ministry of Environment would be the most appropriate agency to be the focal point for the project. It was this Ministry that led the Cambodian team to the WSSD conference in Johanessburg in August 2002.

Under the Technical Assistance program of the ADB, the PREGA project is expected to be launched next year, though a kickoff workshop was held in September 2002. He was interested in knowing the scope of this project.

He mentioned the various projects carried out in the energy sector, and noted that garment is the main industry in Cambodia, and Cogeneration may be feasible probably only in Battambang area. The gasoline price is very high (due to a high tax) and the electricity price in some places could be even $1 even if the supply is for s few hours each day. Electricity of Cambodia is an autonomous body and is working in about seven towns in the country, while the Electricity Authority of Cambodia is a regulatory body.

The institutional framework regarding climate change activities is very weak in Cambodia.

Electricity of Cambodia (Ed C): Acting Executive Director, Corporate Planning and Projects

Mr. Chan Sodavath, Acting Executive Director, Corporate Planning and Projects and Mr. Piseth Chun Technical Engineer informed that Ed C is a 100% state owned utility by the Ministry of Finance and the Ministry of Industry Mines and Energy, with the objective of generating, transmitting and distributing electricity. There are 3 major load centres in the 8 regions, while the other regions are under MIME and independent power producers. The Electricity Authority of Cambodia is a regulatory body providing license, reviews tariffs, studies the investment, and is an arbiter between the customer and the generator.

Ed C has a total installed capacity of about 142 MW of which Phnom Penh area accounts for about 62 MW. Power is generated mostly through oil and diesel plants (which are imported), though there is a 12 MW micro hydro plant. The electricity tariff for homes range from 350 Riel for less than 50 kWh up to 650 Riel (for more than 100 kWh). (1 $ = 3950 Riel). There is a big difference between the peak (80 MW) and offpeak loads (60 MW). He noted that due to the high tariff, energy efficient lamps from China are already being used. Their life is only about a year, but this is also due to low power quality.

The electricity law of 2001 promotes clean energy, and the use of renewable energy is a priority though Ed C is not involved directly. An assessment of micro hydro potential has been done with the support of JICA, ADB and WB. Local banks do not fund energy efficiency or renewable energy projects, though a rural electrification fund will be initiated soon to provide soft loans and subsidies for consumers.

The future plan of Ed C is to reduce the production cost through fuel switching, and launching hydro plants and gas turbines. It is projected that the installed capacity would be about 212 MW in 2002, 330 MW in 2006 and 558 MW in 2112. The main barrier is the high cost, and there could be some potential for biomass based projects. Gas reserves are also being explored. There is also less capacity regarding CDM.

The NGO forum on Cambodia: Environment Network Coordinator

Mr Ea Sophy, Environment Network Coordinator, Mr. Andrew Cock and Mr. Russell informed that their NGO works primarily on forestry, general environment issues and dams. They noted that there was no NGO that was involved in Climate Change activities. As an NGO they would be interested in information regarding the project, and would provide feedback. They also wanted to know about the activities of NGOs in other countries working on similar issues.

23 October 2002

Ministry of Industry Mines and Energy, Department of Energy Development: Director

Mr. Tun Lean informed that there were three departments: Energy Development, Technical Energy and Micro Hydro. Energy Development and Micro hydro departments are involved in implementation of renewable energy systems, while the Energy development department looks at policy planning.

Oil is currently imported from Malaysia, Singapore and Thailand, and the future strategy is to reduce oil use. The long-term focus is on micro hydro development, while in short term Cambodia plans to import electricity from Vietnam and from Thailand (and in the long term, export to these countries). It is expected that by around 2010, fuel oil will not be used for power generation.

Regarding the activities related to renewable energy and energy efficiency, he informed the following activities:

(a)  NEDO of Japan is involved in micro hydro generation (about 10 sites in the country).

(b)  A WB grant was made to study the energy efficiency in lighting in buildings during 1996-1998.

(c)  To reduce energy consumption in transport sector, the Ministry of Roads is working to improve the condition of roads.

(d)  Wood energy planning with NGOs is being carried out for cook stoves (improved).

(e)  There is a plan for a gas turbine combined cycle plant in Sihanoukville (180MW) with Japanese funding, and is expected to be ready by 2007.

(f)  Private entrepreneurs may also be allowed to produce power through coal (imported).

(g)  Environment Impact Assessment for less than 0.5 MW is not necessary, though it will be done for projects of larger capacity. All these are made public, and recommendations are obtained from NGOs before implementation.

UNDP: Deputy Resident Representative

Mr. Ladislaus Byenkya Abwooli met the mission team with Mr. Lay Khim, Environment Analyst and Mr. Ponlock. He informed that the UNDP’s environment focus in Cambodia is on biodiversity, sustainable development and energy and climate change issues. Also, their focus is mostly on capacity building of policy and regulatory staff. They observed that due to floods and droughts (cc) infrastructure and other losses amount to about $200 million (not counting the lives lost), which is substantial in the Cambodian context.