The Asian Development Bank (ADB) has financially backed a project from Singapore’s Sunseap Group to build Cambodia’s first large-scale solar power project under a long-term agreement with the state-run energy utility Electricite Du Cambodge.
ADB’s private sector operations department will provide Sunseap Asset (Cambodia) with a debt financing package of $9.2 million. The package includes co-financing from a private sector financial institution and a concessional loan from the Canadian Climate Fund for the Private Sector in Asia.
The project is located near Bavet, a special economic zone in the Svay Rieng province, and is being implemented through a public-private partnership. As part of the project, Sunseap entered into a 20-year solar power purchase agreement with Electricite Du Cambodge.
Sunseap, one of the largest sustainable energy providers in Southeast Asia, won the tender last year. It was Cambodia’s first competitively bid, renewable energy independent power producer project. This marks Sunseap’s third foray into the international market after developing projects in India and Malaysia.
“The solar farm is expected to begin operations in August. Once completed, it will have an installed capacity of 10 megawatts and be able to meet roughly a quarter of Bavet city’s local energy demand, half of which is currently being met through power imports from Vietnam,” an ADB report said.
“The project will also help reduce greenhouse gas emissions by 5,500 metric tons of carbon dioxide equivalent annually. In addition to providing more reliable power supply in rural areas, the project is expected to generate a range of new skilled and unskilled jobs for the local community,” it added.
Frank Phuan, founder and director of Sunseap Group, said: “We are honoured to have received the support of ADB as we embark on this large-scale project.
“Cambodia is a fast-growing market with vast potential for solar development. Through this partnership, people in rural Cambodia will gain access to a precious commodity that many in the urban developed world take for granted,” he said.
Christopher Thieme, ADB’s deputy director-general for private sector operations, said: “ADB is committed to working with companies like Sunseap to support our strategic agenda for environmentally sustainable inclusive growth.
“ADB’s leading role in financing this project will help demonstrate the benefits of increasing Cambodia’s power supply through public-private partnerships using local, renewable energy sources,” he said.
In Cambodia, the electrification rate grew to 55 percent in 2015, up from 20 percent in 2007.