In early 2020, Cambodian authorities fast-tracked approval of two new coal plants. Soon after, they also signed a memorandum of understanding with the Lao Government committing to purchase energy imports from two proposed coal plants in southern Laos.
This marked a significant shift in the evolution of Cambodia’s energy planning, from a model heavily dependent on hydropower to one in which fossil fuels will play a dominant role. This move towards fossil fuels will have significant implications for the Cambodian economy.
In addition to the obvious environmental and social impacts, this change in strategy threatens Cambodia’s long-term viability as a base for export-oriented manufacturing targeting Western markets, as buyers in the latter are increasingly adopting policies seeking to ‘green’ their supply chains.