Electricity rates steady amid Covid shocks - Phnom Penh Center

Electricity rates steady amid Covid shocks – Phnom Penh Center

Cambodia was one of only nine countries and territories that did not see any major changes in electricity tariffs between 2019 and 2020, as the Covid-19 pandemic began to spread across the world.

This is according to recent data published on Comparethemarket.com.au, an Australian price comparison website operated by Compare the Market Pty Ltd.

Compare the market exploring the volatile shifts in electricity prices during the first few months of the pandemic, which have been largely influenced by resource pressures and global changes in demand.

The largest change was observed in Iran, which saw a 50 percent year-on-year decline in rates between 2019 and 2020. Conversely, South Africa experienced the largest rise of 25.8 percent between pre- and mid-pandemic conditions.

Market digital PR director Hannah Norton compared it to The Post: “Based on our research, Cambodia has been one of very few countries that has not reported any change in electricity tariffs over the past two years.

“The cost was completely flat between 480 and 740 riyals [12 and 18.5 US cents] per kilowatt-hour — depending on home use — for quite some time now,” she said.

“[However, this] Higher than in neighboring countries such as Thailand and Indonesia, where tariffs can reach $0.07-0.10 per kWh. In fact, Cambodia’s tariffs are among the highest in Southeast Asia.”

She said that the exorbitant electricity charges compared to other countries could be a contributing barrier to attracting investment in various manufacturing sectors in Cambodia.

However, she said it does not necessarily detract from the kingdom’s ability to operate sustainably. For example, she said, although private developers charge high tariffs, they reflect the cost, allowing for sustainable operations.

Cambodia Garment Manufacturers Association Deputy Secretary-General King Monica told The Post that electricity rates for 2022 are largely unchanged, and remain among the highest in the region, hampering the Kingdom’s competitiveness, especially in energy-intensive sectors.

“In an effort to lower energy cost and achieve more environmentally friendly production as required by international markets, some business operators in the private sector have attempted to install solar panels while also connecting to the national grid.

“While installing solar energy has contributed to greener production – and thus the environment – it is not financially beneficial to the private sector due to the capacity fee policy by EdC [state utility Electricite du Cambodge].

“The introduction of high capacity fees does not stimulate the use of solar energy and does not bring financial benefit to the private sector. Some see financial losses as a result of using solar energy, due to the high capacity fees.

“This capacity fee should be reduced, at least by half.”

Norton Market Comparison said the head of the Electricity Authority of Cambodia (EAC) in early 2020 announced that the government had decided to invest a “significant amount” to reduce electricity costs for the agricultural and industrial sectors.

In a positive response, leaders of various agricultural and manufacturing industries acknowledged that lowering the price of electricity would increase production and support competitiveness in their sectors.

“Moreover, the Director General of the General Department of Energy of the Ministry of Mines and Energy, Victor Juna, explained that the tariff reduction will contribute to increasing the competitive factor of the country,” she added.

EAC on September 10 last year released electricity tariff plans for 2022 for licensees connected to the national grid, which it said are for ministries and government institutions, as well as licensees for review and comment before October 10.

The suggested rates were as follows – $0.1138 per kWh for connection at medium voltage (MV) from grid substations, $0.1290 for those metered at MV, $0.13416 for consumer transformers metering at LV levels, and $0.14216 for supplier transformer metering at LV.

She pointed out that the rates were to be effective as of January 1, and that the first bills were issued on January 20, stressing that it strives to provide better and affordable electricity services to homes and businesses.

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