While clean energy offers many potential opportunities, experts say Cambodia has the potential to become a leader in green energy production.
Experts said the decline in solar panel sales last year was not a major cause for concern, as the US tariff preferences for solar panels have expired.
Cambodia’s solar panel exports fell by nearly 60 percent to about $830 million in 2024 from more than $2 billion in 2023, according to data released by the General Department of Customs and Excise.
Green energy production includes solar panels, batteries, electric motorcycles, wind turbines and other products that all contribute to the promotion of renewable energy.
Speaking to the Khmer Times, Akshay Pattumuri Venugopal, an electrical engineering expert and technical consultant based in Phnom Penh, said Cambodia has the potential to become a prominent player in the international green energy production sector.
“With abundant solar resources, a strategic geographical location and a growing economy, Cambodia can capitalize on the growing demand for renewable energy solutions.”
He highlighted four factors that could serve Cambodia’s unique interests in this sector: abundant solar energy, strategic location, economic growth, and government support. “Cambodia receives abundant sunlight throughout the year, making it an ideal location for solar panel production. This natural resource advantage can significantly reduce production costs and enhance the competitiveness of Cambodian-made solar products.
“Cambodia offers excellent connectivity to major regional markets, including China, India, and other ASEAN countries. This strategic location facilitates trade and logistics, making the distribution of green energy products efficient and cost-effective.”
On the economic front, he added that Cambodia’s economy has been growing steadily, creating a favorable environment for investment and development in the renewable energy sector.
“This economic growth provides a solid foundation to support the establishment and expansion of the green energy industry. The Cambodian government has shown increasing interest in promoting renewable energy, which could lead to supportive policies, incentives, and financial assistance for green energy manufacturers.
He pointed out that Cambodia must focus on the production of solar panels, wind turbines, bioenergy products, and energy storage systems.
However, he added that things are not going smoothly, as there are many challenges. “A limited skilled workforce, inadequate infrastructure, a lack of technological expertise and limited access to finance could be obstacles to Cambodia becoming a green energy hub,” he added.
A comprehensive national strategy, along with public-private partnerships, can go a long way in addressing these issues, he added.
An article by economist Chun Yu Yang in the South China Morning Post said that Cambodia has many advantages that will support the continued development of its renewable energy industry.
“Cambodia’s low labor costs remain a key competitive advantage for the manufacturing sector. In addition, a high degree of dollarization reduces currency risk for foreign investors. While capital controls remain lax, foreign investors can move their money in and out of the country freely, which helps boost confidence in the economy.
“The government is also easing regulations, improving the business environment and providing incentives for more investment, such as tax breaks and tax exemptions. These measures are aimed at making Cambodia an attractive destination for foreign direct investment and an attractive diversification option for companies considering a ‘China+1’ or ‘Thailand+1’ strategy.
In addition, the government has published its energy development plan for 2020-2040, focusing on increasing the share of renewable energy, improving grid stability and reducing energy costs, allowing Cambodia to develop its renewable energy sector more deeply.
But he sees Cambodia’s solar panel industry facing challenges from unstable electricity supply and high transportation costs. “The unit price of solar panel exports is still higher than the other three countries, reflecting the need for Cambodia to address infrastructure bottlenecks to reduce production costs and remain competitive.”
Green energy expert Dr. Wu Shun Te told the Khmer Times that Cambodia must pay more attention to promoting renewable energy production as well as the production of renewable energy products. He said that tapping the potential of renewable energy in all sectors would provide a high standard for environmentally friendly growth.
