Rooftop Solar Regulations Loosened

Cambodia has introduced a new rooftop solar power policy in its quest to cut carbon emissions and meet increasing demands from the private sector and international investors
Workers clean solar panels at a factory in Kampot province in 2021. Kiripost/stringer
Workers clean solar panels at a factory in Kampot province in 2021. Kiripost/stringer

A new principle for rooftop solar power in Cambodia has been introduced to help the nation fulfill its global commitment to reduce greenhouse gas emissions while meeting rising demand from international organizations operating in the country.

In April, the “Principles for permitting the use of Rooftop Solar Power in Cambodia” launched, aiming to enhance the management of rooftop solar power in Cambodia to be “clear, effective, transparent, equality, accountability, and fair”.

It said that as the private sector stepped up its efforts to address climate change, importing countries, some buyers and institutions importing industrial goods and products from Cambodia are seeking to reduce the carbon footprint of their products.

As a result, a Cambodia-based factory that exports its products to other countries is looking to harness the power of solar energy on its rooftop to demonstrate its contribution to the environment and tackling climate change, it added.

It said that the cost of developing a rooftop solar system for consumers based on the quota is expected to be higher than the cost of developing utility-scale solar power. Therefore, it must be clearly and properly managed to maintain justice for other electricity consumers.

“To provide fairness to other consumers, the electricity consumers using energy from rooftop solar power in any location shall pay compensation cost for that amount of energy at a Compensation Tariff of Variable Energy from Rooftop Solar,” it said.

According to the fairness principle, the Compensation Tariff of Variable Energy from Rooftop Solar plus the electricity price from rooftop solar power shall not exceed the General Tariff rate for electricity supplied by the national grid system to electricity consumers having solar generation.

“The rooftop solar power users based on quota, who have received the permit to use rooftop solar power in fulfilling their environmental and climate change obligations, will not pay electricity price exceeding other same category electricity consumers without solar PV installation,” it said.

For rooftop solar power users serving the location that are not connected to the national grid and do not import power from the grid to meet their actual consumption needs shall not be required to pay the Compensation Tariff of Variable Energy from Rooftop Solar, it added.

Massimiliano Tropeano, a sustainability and garment expert, said that the new regulation has interesting elements, including the removal of the 50 percent capacity restriction on RTS inverter size and the introduction of a quota system.

However, considering how the new “compensation tariff” is calculated, the numbers that EAC decides for the levelized cost of electricity (LCOE) and grid loss will have to be determined, he said.

“These numbers, depending on how high they will be, will have the potential of ‘making or breaking’ the solar rooftop business in Cambodia,” he said.

Vietnam recently announced its goal to generate at least 30.9 percent of its energy from renewable sources by 2030, with an increase to 67.5 percent by 2050. In 2020, Vietnam produced no electricity from offshore wind, but by 2035, it should have 15GW, or about 18.5 percent of its entire power mix. “It's very clear which direction Vietnam has chosen,” he explained. “It gives strong and firm signals to foreign investors, therefore Cambodia could possibly make its approach more progressive,” he said.

“A strongly progressive and open policy towards variable renewable sources including solar and wind that will cross the 20 percent mark in the energy mix would put Cambodia in a strong situation making it a green privileged destination for Western and American sourcing companies.”

The document said that grid electricity tariffs and the Compensation Tariff of Variable Energy from Rooftop Solar are the tariffs notified by the Electricity Authority of Cambodia (EAC) for the category of consumer and size of rooftop solar installation.

This is normally assessed by EAC every six months to one year, it added.

In 2022, the study of the Power Development Master Plan for 2022-2040 indicated that the national power grid system of Cambodia can absorb a maximum solar power of up to 3,115 MW, which is equal to 29.8 percent of potential sources of total domestic electricity energy in 2040.