Prime Minister Hun Sen wants Electricite du Cambodge to stop charging industries higher prices to keep bills to residential customers artificially low.
He said the company sells power below cost to all residential users and makes up the difference by charging commercial customers more.
The problem with that, he said Friday before leaving for Cuba, is that some of those residential customers use a lot of power, while industries must use their own generators to get enough.
Hun Sen spoke at a ceremony for a two-year electricity project in Takhmau funded by Japan. The $32 million project will install new distribution lines and sub-stations in four Phnom Penh districts.
Hun Sen’s remarks came a few days after the Asian Development Bank and World Bank urged the price reform as a condition for loans for future projects.
The prime minister told the ministries of Industry and Finance and EdC to review pricing based on two principles: That prices for residential users should be split into two tiers, with ordinary residents paying lower prices while bulk users pay commercial prices; and that prices for commercial customers should be reduced.
Currently, the electric company charges families 350 riel ($0.09) per kilowatt-hour, about $0.02 below the actual cost, while commercial customers pay more than twice that.
EdC had proposed raising prices for residential users who consume more than 300 kilowatt-hours per month, and cutting prices for businesses, government institutions and foreigners.
The donors last week rejected the plan, saying it wouldn’t work.
Ty Norin, executive director of planning for EdC, said Sunday a counter-proposal will be ready by the end of April.
The prime minister said the electric company must improve all of its financial and operational management to eliminate theft and lower costs.