Prakas On the Implementation of the Climate Change Action Plan for Energy Sector 2021-2023

7 Ministry of Industry, Mines and Energy (MIME) (2013). Cambodia Sustainable Energy for All Readiness Plan, Phnom Penh, Cambodia. Climate Change Action Plan for Energy Sector 2021 - 2023 2 Informal Translation In the Inclusive and Sustainable Development angle, ensuring environmental sustainability and preemptive response to climate change is the focus of RGC Rectangular Strategy (Phase IV). Additionally, the RGC focuses on enhancing competition across businesses, promoting industrial innovation, technical training, research and development, entrepreneurship, sustainable natural resource management, assurance of environmental sustainability with investment in human capital leading to job creation as important facets of the country’s development journey. It further calls for lowering of energy price thereby contributing to Cambodia’s competitiveness and energy security. Key highlights of the RS related to the power sector include: - Strengthen human resources/institutional capacity for management of the energy sector, - Private sector participation, - Environmental sustainability and green development, - Expansion of energy sector infrastructure, aiming at ensuring energy security, reliability and affordability to meet development needs, - Further lowering the electricity prices, expanding supply coverage and enhancing electricity reliability through the construction of additional sub-stations near economic poles and areas with high economic potential, - Diversification of energy resources, - Continuing to encourage and increase investment in clean energy and renewable energy, especially solar power while reducing the production of energy from unclean sources to ensure long-term energy security, - Rural electrification. A.1.2. National Strategic Development Plan (2019-2023) To implement the RGC’s priority policies in the Sixth Legislature of the National Assembly, the MME sets plan to continue its priority activities in managing and promoting the power sector development to achieve an adequate, reliable, quality, and affordable electricity supply for all types of users and to manage and promote the development of energy efficiency and energy saving. It portrays an obvious link between energy and sustainable human development sector; thus, identifying that the lack of energy and unaffordable costs correlates closely with many challenges of sustainable development (RGC, 2019). Key highlights of the NSDP related to the present project include: - Low-carbon development as the basis for green growth, - Development of the energy sector and electricity network, - Expand supply capacity and diversified energy sources to reduce reliance on petroleum fuels for electricity generation, - Development of large hydropower for grid electricity, - Increase the use of Renewable Energy (RE), - Environmental sustainability and green development, - Encourage private sector to participate in investing in rural power supply services with a sustainability, in particular, the use of new technologies and RE, - Promoting development of the energy sector and electricity by enhancing the connectivity to people with quality, stability, and affordability of electricity, Climate Change Action Plan for Energy Sector 2021 - 2023 3 Informal Translation A.2. Climate change policies & strategies, A.2.1. Cambodia Climate Change Strategic Plan (CCCSP) 2014-2023 CCCSP has the following strategic objectives: - Promote the use of renewable energy and energy efficiency to reduce greenhouse gas emissions and health effects:  Renewable energy  Energy efficiency  Appropriate technology transfer  Solid / liquid waste management through integrated measures in the capital city, urban areas, and animal waste management. - Analyze low GHG emissions by sectors (agriculture, energy, transportation, industry, land use and forestry management, and waste management). - Develop policies, legal framework, and action plans for low carbon development in accordance with national development priorities. - Promote the transfer of appropriate technologies to promote low-carbon development and facilitate the use of appropriate technologies through:  Guidelines for technical assistance and partnership building  Financial and tax incentives  Carbon marketing mechanism  Public and private partnership mobilization - Establish a system for registering projects and programs to reduce greenhouse gas emissions - Establish a quality national greenhouse gas inventory system. A.2.2. National Communication In line with CCCSP, RGC submitted the Cambodia’s Initial National Communication (INC) in August 2002 and Second National Communication (SNC) in 20168,9. INC and SNC highlighted that, though Cambodia is not a high emitting country, the government has committed to reduce GHG emission with condition of financial and technical support from developed countries. A.2.3. Nationally Determined Contribution After INC and SNC, the first Nationally Determined Contribution (NDC) was submitted to the UNFCCC in 201510. The first NDC is presently under revision to be second Nationally Determined Contributions (NDC), which will be implemented during 2020-2030. The NDC has identified the following five actions to reduce greenhouse gas emissions in the energy sector: - Maximize the use of renewable energy sources and increase the efficiency of energy consumption in the national power supply system by maintaining an adequate, reliable, and low-cost electricity supply to compete with neighboring countries. - Connect rural electricity enterprises to the national electricity supply network 8 https://unfccc.int/sites/default/files/resource/Cambodia%27s%20INC_0.pdf 9 https://unfccc.int/sites/default/files/resource/khmnc2.pdf 10 https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/Cambodia%20First/Cambodia's%20INDC%20to%2 0the%20UNFCCC.pdf Climate Change Action Plan for Energy Sector 2021 - 2023 4 Informal Translation - Connect GHG intensive energy consumers to the national grid - Provide power supply to areas outside the national electricity supply system using clean energy technologies, - Improve energy efficiency. In the past, the preparation of NDC in term of mitigation action identification, amount of GHG emission in the Business-As-Usual (BAU) scenario by 2030, and the determination of the amount of greenhouse gases that the Cambodian energy sector must reduce compared with BAU scenario were assumed and not clearly consistent with the PDP of RGC. This makes the implementation from the energy sector unclear and difficult. To address this, MME has incorporated climate change response goals into discussions and studies to update the PDP so that mitigation and adaptation projects identification supports climate change response better. It also ensures alignment with PDP and energy sector development goal. Consistency with these documents will support the effective implementation of NDC. A.2.4. Biennial Update Report In 2020, first Biennial Update Report (BUR)11 has been submitted to the UNFCCC as a reference for preparing policies and strategies to address climate change in the Kingdom of Cambodia. The report includes relevant data and information regarding Cambodia´s major sources of GHG emissions and sinks, coupled with necessary mitigation measures already implemented or planned; thus, furthering her contribution to global efforts to reducing GHG emissions. A.3. Energy sector development policies & strategies A.3.1. Rural Electrification by Renewable Energy Policy In 2011, the Rural Electrification by Renewable Energy Policy was integrated into the government’s overall agenda for the energy sector to provide reliable, affordable and adequate supply of electric power for all consumers. Moreover, promoting private ownership of electrical facilities and encouraging competition among the companies in the energy sector is another focus of the national policy on energy12. There are two strategic targets that drive the energy development in Cambodia: 1). by 2020, all villages to be connected to some sorts of electricity supply; and 2). by 2030, at least 70% of all households accessed to grid quality electricity. With support from private sectors, the government has already achieved the HH electrification target 10 years ahead of the planned schedule. At the end of 2019, Cambodia has already electrified 74.78% of total Cambodia households. At the end of 2020, 463 REEs are licensed to provide electricity supply in the country. The license area covers 14,143 (99.82%) villages among a total of 14,168 villages in which other 25 villages are outside the license zone. Out of the 14,143 villages in the license zone, 13,798 villages are already electrified with national grid electricity while 370 villages are not yet electrified. Thus, at the end of 2020 a total of 370 villages (or 2.61%) are not yet electrified. According to EAC, these 370 villages are difficult to reach. Among these 370 villages that are difficult to reach, 251 villages are in remote areas and with scattered households; 32 villages are without road access; 46 villages are on islands; 34 villages are floating villages, and 7 villages are rainy season flooding villages. 11 https://unfccc.int/sites/default/files/resource/FBUR_Cambodia.pdf

12 EC-ASEAN energy facility. Feasibility study of renewable energy options for rural electrification in Cambodia (REOREC); 2006. Climate Change Action Plan for Energy Sector 2021 - 2023 5 Informal Translation During the annual summit of Ministry of Mines and Energy in 2019, the ministry has proposed three key measures for energy sector development as part of its strategy, in line with National Strategy Development Plan 2019-2023 of the RGC. In this strategy, the government has revised the electricity access targets as follows: - Village areas: achieve an electrification rate of 100%, including solar and battery illumination, by 2020. - Household electrification: achieve an electrification rate of at least 90% connection to the national grid by 2023. Table 1: Strategic development plan of power sector of MME in NSDP 2019 – 2023 Policy Goal Action plans measures 1.1. Update PDP master plan, 1.2. Continue developing delivery and distribution 1. Continue capacities to ensure that Cambodia has sufficient to develop, electricity to supply from the national grid and to improve cover all villages, supply 1.3. Promote the network’s connectivity to reach the capacity needs of more than 90% of households having access To achieve to Electricity by 2023. adequate, 2.1. Improve the supply of electricity so that the supplying reliable, quality is sufficient for 24 hours uses, quality, safe, reliable, and affordable 2. Improve more affordable, and fair to measure and record the electricity electricity supply. supply for all supply 2.2. Improve the supply of electricity to facilitate types of businesses in Cambodia, including procedure, consumers numbers connection days, connection cost, reliability everywhere of supply, and the transparency of electricity charges. throughout the 3.1. Strengthen institutional communication mechanisms, Kingdom of 3.2. Attract investments, making sure there is sufficient Cambodia. investments, 3. Strengthen 3.3. Use rural electrification funds to cross-subsidy, reduce controlling the cost gap, and transfer capital for rural mechanisms developments, 3.4. Minimize the environmental and social impact, manage energy potential, participate in clean energy sources, participate in regional and international energy cooperation The government focuses on providing energy services and improving the quality of life for the rural population in two main policies: 1) Energy Sector Development Policy and 2) Rural Electrification Policy. Renewable energy development is one of many approaches adopted to meet the mentioned objectives. Rural Electrification Fund (REF) subsidy and investment incentives are two main policy instruments to support implementation of the Energy Sector Development and Rural Electrification Policies financially. Based on the REF documents among Climate Change Action Plan for Energy Sector 2021 - 2023 6 Informal Translation the renewable technologies, the only Solar Home Systems (SHSs) and mini/micro hydropower are qualified for subsidies scheme13,14,15,16. B. Context of Climate Change for Energy Sector Climate change is a threat not only to the energy sector but to development of the whole country because its impact has affected all Cambodian important sectors. According to the recent Addressing Climate Change Impacts on Economic Growth in Cambodia17, Cambodia’s GDP in 2015 was already 4.6% lower than it would have been without climate change over the 1993- 2015 period, and it will reduce Cambodia’s GDP by 9.8 % in 2050. Climate change is expected to worsen the frequency, intensity, and impacts of extreme weather events such as floods, droughts, storms, heat waves. The increase in temperature will affect the crop yield and labor productivity directly while the flood and change of rainfall can damage the crop. These impacts and consequences will require adaptation to climate change as well as actions to mitigate anthropogenic and natural global warming. It means that active, and selective policy will have to be used to achieve the balancing act of reducing GHG emissions and increasing adaptation capacity that could ensure that Cambodia can achieve low carbon development and climate resiliency. Generally, the challenge is to ensure that the development of the energy sector is not adversely affected by the impacts of climate change and it contributes to a low-carbon and de- carbonized economy; while simultaneously the development takes place without worsening the global warming. Moving to a low-carbon economy will require policy measures towards innovation and technology change that have different outcomes over the short, medium and long-term. Over the short-term the emphasis need to be on improving energy efficiency, over the medium term it needs to be on increasing the use of renewable energy and energy supply diversification for all consumption, and over the longer term on introducing more path-breaking technologies for low-carbon energy generation18. B.1. Climate Change Vulnerability The energy sector is, on the one hand, vulnerable to climate change, particularly to the damages from natural disasters on energy infrastructures. On the other hand, it can contribute to climate change through the emission of greenhouse gas (GHG) from fossil fuel power plants. Three major climate hazards that are relevant to the energy sector include:  Increasing temperature,  Increasing frequency and intensity of drought,  Increasing frequency and intensity of storms and floods. Table 2: Impact of climate change on energy sector

13 UN Department of Economic and Social Affairs. Cambodia Energy Sector Strategy. 2010. Available: http://www.un.org/esa/agenda21/natlinfo/countr/cambodia/energy.pdf

14 Ung L, Sovuthea H, Siek S, Chetra S. Status and potential for the development of biofuels and rural renewable energy Cambodia. Asian Development Bank 2009.

15 Hill RL, Curtin KM. Solar powered light emitting diode distribution in developing countries: an assessment of potential distribution sites in rural Cambodia using network analyses. Socio-Economic Planning Sciences 2011; 45: 48–57.

16 Javadi FS, Rismanchi B, Sarraf M, Afshar O, Saidur R, Ping HW, et al. Global policy of rural electrification. Renewable and Sustainable Energy Reviews 2013;19: 402–16. 17 http://www.camclimate.org.kh/en/documents-and-media/library/category/39-financing.html?download=912:full-report-on- cc-impacts-on-economic-growth-in-cambodia_may-2018_en

18 Naudé, W. (2011). Climate Change and Industrial Policy. Sustainability 2011, 3, 1003-1021; doi:10.3390/su3071003 Climate Change Action Plan for Energy Sector 2021 - 2023 7 Informal Translation Sector Impacts of climate change on energy sector Hydro power Extreme temperatures may affect energy generation due to increased reservoir evaporation. It may increase rain fall due to storm, which induces increasing water quantity in hydro basins that can affect hydro dam. Wind power Increased temperatures may decrease air density, decreasing energy output. Biomass Increased temperatures may affect crop yield and irrigation needs. Extreme temperatures may induce fires and threaten crops. Solar power High temperatures may reduce solar PV cell efficiency. High temperatures may alter concentrated solar power (CSP) efficiency. Thermal power Higher temperature of cooling water may decrease plant efficiency. Table 2 presents an overview of climate change impact on power generation system. Increasing of temperature, frequency and intensity of drought, storms, and floods will each independently, and in some cases in combination, affect the ability of Cambodia to produce and transmit electricity from both fossil and renewable energy sources (such as hydropower, biomass, biogas, solar and wind energy). Climate change does also affect the nation’s demand for energy. In 2019, due to drought and late arrival of rain the supply capacity did not meet the demand (Figure 1). This caused power outage across the country due to rotational load shedding. However, the supply is around 40% over the demand during the rainy season (Figure 2). This situation could be attributed to the challenges associated with management of seasonality of hydro power generation and temporary surpluses of generation capacity. 2000 1,755.00 1800 1,537.00 1600 1400 1,247.00 Capacity (MW) 1200 1,068.00 951.00 1000 784.00 800 625.00 508.00 600 407.00 334.00 400 200 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year Hydro Coal Oil Import with MV lines Import with HV lines Solar Biomass Demand Figure 1: Supply Capacity and Demand in Dry Season from 2010 to 2019. Climate Change Action Plan for Energy Sector 2021 - 2023 8 Informal Translation 3500 3000 Capacity (MW) 2500 1,800 2000 1,518 1500 1,269 944 1,042 1000 769 480 612 334.00 407.00 500 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year Hydro (MW, %) Coal (MW, %) Oil (MW, %) Import with MV lines (MW, %) Import with HV lines Biomass Solar Demand Figure 2: Supply Capacity and Demand in Rainy Season from 2010 to 2019 An assessment of impacts is necessary to inform forward-looking efforts to enhance climate resiliency, reliability, energy security and safety. Based on experiences and existing study, significant findings include:  Renewable energy resources, particularly hydropower, bioenergy and solar power, can be affected by changing precipitation patterns, increasing frequency and intensity of drought and floods, and increasing temperatures.  Electricity transmission and distribution systems carry less current and operate less efficiently when ambient air temperatures are higher, and they may face greater risks of physical damage from more intense and frequent storm, lightnings and flood events.  Higher temperature will increase electricity demand for cooling system used in residential, commercial and industrial premises. B.2. Contribution to Climate Change The increase of energy consumption has put a heavy pressure on resource consumption and environmental performance particularly the emission of GHG and other air pollutants. According to the BUR, five major sources of GHG emission are 1) forest and other land use (FOLU), 2) agriculture, 3) energy, 4) industrial processes and product use (IPPU) and 5) waste19. Figure 3 depicts the amount of emissions from these five sources from 1994 to 2016. It is observed that land-use change and forest, and agriculture are the main source of emission while energy and industrial processes are rising rapidly during the last decade due to the use of coal for power generation, fuel for transportation, fossil fuel power generation, and industrial development in the country. Cambodia’s 2016 GHG profile (Figure 4) was dominated by emissions from the FOLU sector, which accounted for 80% of the country’s total emissions of 163,592.35 MtCO 2e. Agriculture was the second highest emitter (11%) with rice cultivation and enteric fermentation from livestock as major sources of agriculture emissions. Energy, IPPU, and waste contributed 16%, 1%, and 2% of total emissions, respectively. According to BUR, Cambodia’s GHG emissions increased by 121,142.07 MtCO2e from 1994 to 2016. The average annual change in total emissions during this period was 12.97%, with sector-specific average annual changes as follows: 19 https://unfccc.int/sites/default/files/resource/FBUR_Cambodia.pdf Climate Change Action Plan for Energy Sector 2021 - 2023 9 Informal Translation FOLU (17.5%), agriculture (2.92%), energy (11.67%) industrial processes (2168%), and waste (3.63%). 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 - 1994 2000 2005 2010 2015 2016 Energy IPPU Waste Agriculture FOLU Figure 3: Cambodia GHG Emissions (MtCO2e)20 Energy IPPU Waste 6% 1% 2% Agriculture 11% FOLU 80% Figure 4: GHG emission profile of Cambodia in 2016 Under the energy emissions, transportation is the major source of GHG emissions accounted for 53% of total emission of 9.60 MtCO2e in 2016. Energy industry including fuel combustion was the second highest emitter (34%) with biomass wood for cooking and thermal energy generation in the form of steam in manufacturing industry and others contributed 8% and 5% of total emissions, respectively. 20 https://unfccc.int/sites/default/files/resource/FBUR_Cambodia.pdf Climate Change Action Plan for Energy Sector 2021 - 2023 10 Informal Translation Other 5% Energy Industries 34% Transport 53% Manufacturing Industry 8% Figure 5: GHG emissions from Cambodia energy sector in 2016 Note: MME only manages energy in the production of energy sources to supply for other uses, while energy consumption in the manufacturing industry and transportation sector is not yet under the control of MME. B.3. Existing Initiatives Even GHG emission from Cambodia is less than 1% of global emission, Cambodia has also committed to GHG emission reduction. Cambodia Nationally Determined Contribution (NDC) committed to reduce the GHG emissions by 21.3% by 2030 from energy sector, relative to its BAU GHG emissions, contingent upon international support. The commitment will be implemented in the energy sector through increased on-grid and off-grid renewable energy generation and promotion of energy efficiency; in the IP sector through the promotion of renewable energy and adoption of energy efficiency in garment factories, rice mills, and brick kilns; in transport through the promotion of public transport and use of energy efficient vehicles, and actions in other sectors21. MME had been engaged in a number of efforts to respond to climate change, including the development of the Climate Change Strategic Plan (CCSP) for Manufacturing Industry and Energy Sectors, the National Green Growth Strategic Plan22, the Cambodia Sustainable Energy for All Readiness Plan23 and the draft Energy Efficiency Policy, Strategy and Action Plan24, Cambodia Power Development Mater Plan, Renewable Energy Policy which are under preparation. These policies, strategies and action plans will continue to play an important role in developing the energy sector while at the same time addressing the mitigation aspect of climate change response through green energy production (renewable energy sources) and energy efficiency and adaptation aspect through the assessment of energy infrastructures ability to withstand the climate change impacts. C. Priority Issues During the work leading up to MME’s CCAP, MME also has some priority tasks that have to be implemented during this period. Overall, the MME’s works in the energy sector, which is in line

21 RGC. Updated Cambodia’s Nationally Determined Contribution 2020 22 Royal Government of Cambodia. National Green Growth Strategic Plan 2013 23 Ministry of Industry, Mines and Energy (MIME). Cambodia Sustainable Energy for All Readiness Plan, Phnom Penh, Cambodia. 2013. 24 Ministry of Industry, Mines and Energy (MIME). National Policy, Strategy And Action Plan on Energy Efficiency in Cambodia. 2013 (draft). Climate Change Action Plan for Energy Sector 2021 - 2023 11 Informal Translation with the activities to respond to climate change and the priority works of the energy sector for 2021-2023 are as follows:  Continue to lower electricity price, expand network coverage and increase electricity stability by building additional sub-stations to the economic poles and high economic potential areas;  Continue to promote rural development by continuously investing in expanding coverage of electricity;  Continue to encourage and increase investment in renewable energy, along with the gradual reduction of energy production from fossil fuels, to ensure an efficient supply of electricity to Cambodia's society and economy and to long-term response to climate change;  Finalize the energy efficiency policy and road map for implementation;  Study and identify low-carbon and environmentally friendly technologies that Cambodia can develop by maintaining key energy development goals;  Formulate and analyze the GHG emission sources and implement mitigation measures in the energy sector;  Undertake climate change vulnerability assessment of the energy infrastructures with adaptation measures;  Increase institutional capacity for adaptation and mitigation response, including risk assessment, legal framework, institutional arrangement, technology transfer, human capacity building, and research and development;  Develop legal and regulatory frameworks for the energy sector to ensure efficient management and use of energy resources;  Continue to foster development of all types of renewable energy and enhance the efficient use of energy;  Update PDP with maximizing feasible use of renewable energy while maintaining key energy sector development goals;  Promote the network’s connectivity to reach the needs of more than 90% of households having access to Electricity by 2023;  Improve the supply of electricity so that the supplying is sufficient for 24 hours uses, quality, safe, reliable, more affordable, and fair to measure and record the supply;  Minimize the environmental and social impact;  Manage energy potential, participate in clean energy source usage and participate in regional and international energy cooperation. II. STRATEGIES Reduction of GHG emission is a global shared responsibility. However, it must start from sectoral and national level intervention. Two common strategies to respond to climate change are mitigation and adaptation. While climate change mitigation is often discussed in terms of constraints, there are various environmental, economic, and social co-benefits that may arise as a result of mitigation actions. The promotion of renewable energy can lead to increased local employment due to decentralized energy production. Reducing GHG emissions have also provided health benefits e.g. through lower urban air pollution concentrations. Successful mitigation measures can also lead to potential cost savings due to a reduced need for adaptation actions. Climate Change Action Plan for Energy Sector 2021 - 2023 12 Informal Translation Thus, the preparation of a strategy to respond to climate change has two levels: firstly, development of a global climate change response strategy prepared by the Secretariat of the United Nations Framework Convention on Climate Change; and national climate change response strategies developed by individual countries. II.1. Global Climate Change Response Strategies Mitigating climate change requires a fundamental change in the way decision-makers, the public and the private sector perceive and pursue economic development. The main goal is to develop energy sector through deploying low carbon technology for everyone’s benefits. Three important dimensions of low carbon development include: 1). new political paradigm 2). more resource efficient patterns of consumption and production, as well as 3). incentives to redirect investment flows. Incorporating this low carbon technology into global climate change response strategy can help reorienting the intended overall economic, energy, and emissions trajectory for a country, set clear targets, and identify and prioritize policy interventions that contribute to national development goals. Thus, at the global level, there are three common strategies for climate change response25: - Preparation of political agenda to develop and implement plans and strategies resulting in less carbon intense economic development; - Patterns of consumption and production, which are resource and energy efficient; and - Redirection of investments towards clean technologies, renewable energy, and sustainable management of water, agriculture and forests. II.2. National Climate Change Response Strategies Cambodia has developed and adopted CCCSP 2014-2023 to guide interested parties in developing concrete and appropriate measures and actions related to adaptation and GHG mitigation. In the action plan (CCCSP), eight strategic objectives are proposed: - Strategic Objective 1: Promote climate resilience through improving food, water and energy security. - Strategic Objective 2: Reduce sectoral, regional, gender vulnerability and health risks to climate change impacts. - Strategic Objective 3: Ensure climate resilience of critical ecosystems (Tonle Sap Lake, Mekong River, coastal ecosystems, highlands, etc.), biodiversity, protected areas and cultural heritage sites. - Strategic Objective 4: Promote low-carbon planning and technologies to support sustainable development. - Strategic Objective 5: Improve capacities, knowledge and awareness for climate change responses. - Strategic Objective 6: Promote adaptive social protection and participatory approaches in reducing loss and damage due to climate change. - Strategic Objective 7: Strengthen institutions and coordination frameworks for national climate change responses. - Strategic Objective 8: Strengthen collaboration and active participation in regional and global climate change processes. 25 EU and UNDP Low Emission Capacity Building Programme website. Climate Change Action Plan for Energy Sector 2021 - 2023 13 Informal Translation Based on the above National Climate Change Strategic Plan, the strategic objectives of the Climate Change Strategic Plan for the energy sector within the jurisdiction of the Ministry of Mines and Energy for 2021-2030 are defined as follows: Strategic objective 01: Policy Development in energy sector to meet SEforALL target ensuring the key goal of the energy sector development, which is to supply adequate, reliable and low-cost energy sources to compete with neighboring countries. Strategic objective 02: Promote energy infrastructure development to be climate proof or climate resilient. Strategic objective 03: Implementation of the GHG emission management approach for the energy sector. Strategic objective 04: Improve capacities, knowledge and awareness for climate change response. III. ACTION PLAN A. Summary Scope of Planning The Climate Change Action Plan for the Energy Sector focuses on enhancing climate change adaptation and mitigation through building institutional capacity of MME and its staff, setting necessary policy and guidelines, implementing needed actions and cooperating with relevant stakeholders to cope with issues arising from a changing climate and extreme weather events such as floods, storms, droughts, as well as rising temperature. The Action Plan will continue to scale up existing actions and propose new dedicated actions most relevant to climate impacts on energy infrastructure and low-carbon development. B. Action Plan Matrix The MME has proposed actions to address concerns related to climate change issues in the mining and energy sectors. These are summarized in the table below Climate Change Action Plan for Energy Sector 2021 - 2023 14 Informal Translation Table 3: Matrix planning CCCSP Strategy # CCSP Strategy # Action Number Responsible Preliminary Estimated budget (Thousand USD) NDC# Category of Financial MME Climate Change Actions Sources action department(s) 2021 2022 2023 Total Promote climate resilience through 1 improving food, water and energy Security Policy Development in Energy Sector to meet SEforALL target ensuring the key goal of the energy sector development, 1 which is to supply adequate, reliable and low-cost energy sources to compete with neighboring countries. Review and update Cambodia energy 18 1 Modified GDE 2,100.40 120.00 120.00 2,340.40 ADB development master plan. Review and update national energy GDE, NA 2 Modified 934.28 500.00 500.00 1,934.28 ADB efficiency policy (NEEP). GDDA Reduce sectoral, regional, gender 2 vulnerability and health risks to climate change impacts To promote the energy infrastructures to 2 be climate proof or climate resilient Strengthen the capacity and stability of NA 3 Modified EDC 49,930.00 86,040.00 57,720.00 193,690.00 ADB substations and transmission lines. Climate Change Action Plan for Energy Sector 2021 - 2023 15 Informal Translation Conduct climate risk study for Cambodia GDE power system and provide 24 4 Dedicated and 146.00 116.00 60.00 322.00 NA recommendation for future EDC implementation. Promote low-carbon planning and 4 technologies to support sustainable Development Implementation of the GHG emission 3 management approach for the energy sector Establish national greenhouse and energy NA 5 reporting system for GHG inventory and Modified EDD 176.00 142.00 258.00 576.00 NA energy balance. Provide the remaining and remote off-grid EDC, 17 6 villages and household with low carbon Modified DREOE 20,782.19 18,043.19 36,086.38 74,911.77 KfW, energy. ADB DETBP Develop and implement energy efficiency NA 7 Dedicated 200.00 200.00 200.00 600.00 ADB projects to support NEEP implementation. Develop and implement Energy Efficiency 12 8 Standards & Labelling Program to support Modified DETBP 2,100.00 400.00 400.00 2,900.00 ADB NEEP implementation. Conduct study on clean and sustainable 16 9 energy for cooking and implement the Dedicated EDD 100.00 1,000.00 400.00 1,500.00 NA best available options for cooking. Conduct study on sustainable business NA 10 model to introduce efficient and clean Dedicated DTC 600.00 400.00 300.00 1,300.00 NA thermal energy for all sectors. Climate Change Action Plan for Energy Sector 2021 - 2023 16 Informal Translation Establish energy management program for large buildings and factories and EDD, 14 11 Dedicated 400.00 500.00 400.00 1,300.00 ADB voluntary scheme for SMEs for NEEP DETBP implementation Improve capacities, knowledge and 5 4 awareness for climate change response Implement capacity building in the NA 12 Modified DETBP 100.00 50.00 500.00 650.00 NA renewable energy and energy efficiency. EDD, 13 13 Raise public awareness on energy saving. Dedicated 190.00 500.00 500.00 1,190.00 NA DETBP Grand Total 77,758.87 108,011.19 97,444.38 283,214.44 Climate Change Action Plan for Energy Sector 2021 - 2023 17 Informal Translation C. Expected Benefits from the Implementation of the Action Plan The CCAP would enhance capacity of MME to effectively respond to the impacts of climate change and mitigate the GHG emissions in the energy sector within jurisdiction of the MME. Also, the CCAP would generate evidence-based implementation to inform future climate change interventions through better policy, climate change proofing and resiliency, GHG emission management and natural resources and capacities, knowledge and awareness for climate change response improvement. The expected results of this action plan implementation will have both short and long-term benefits. Short-term benefits could include:  Increased capacity of technical staff of the Ministry and partners involved in implementing the action(s) to address climate change adaptation and mitigation (e.g. through training of trainers with new methods and approaches);  Established institutional and legal frameworks: legal measures and policy developed, ministerial CCAP’s integrated into the National Strategic Development Plan (NSDP), technical manual or guidelines developed;  Harnessed soft and hard technology from developed countries to Cambodia;  Changed behavior of different target groups for adaptation and mitigation;  Committed stakeholders (especially government institutions, private sector and development partners) to tackle the impacts of climate change and mitigate the GHG emissions. Long-term benefits will focus on:  Enhanced environmentally sound economy, that reduces poverty (improved productivity and quality of life, improved environment in which we are living);  Conserved natural resources for sustainable development;  Considered long-term investment and proactive measures;  Enhanced environmentally sound society (reduced GHG emissions and other waste and pollutants);  Saved resources such as water, energy and the other resources. IV. MANAGEMENT AND FINANCING MECHANISM A. Analysis of Existing Management and Financing Mechanisms Figure 6 below illustrates a structural management of the Ministry of Mines and Energy. The Ministry has four general departments including General Department of General Affairs (GDGA), General Department of Mineral Resources (GDMR), General Department of Petroleum (GDP), General Department of Energy (GDE). Among these, GDE will take most of the responsibilities in implementing this CCAP. The ministry has formed a Climate Change Working Group for the representatives from relevant departments who will take the lead to promote CCAP implementation in their respective sectors, and coordinate where required. Climate Change Action Plan for Energy Sector 2021 - 2023 18 Informal Translation Minister Secretaries of State Under Secretaries of State Cabinet GD of General GD of Mineral GD of GD of Energy Affairs Resources Petroleum Dept. of Internal Audit Inspectorate Provincial Dept. of Mines and energy Financial Audit Unit Dept. of Admin & Dept. of Mineral Department of Dept. of Energy IT Geoscience Petroleum Study Development and Research Dept. of Staff Dept. of Mineral Dept. of Economic Dept. of Renewable & Planning Petroleum Other Energy Dept. of Technology, Accounting & Operation Dept. of Hydro Finance Support, and Energy Dept. of Dept. of Legal Energy security Construction Affairs Sand Mining Dept. of Thermal Dept. of and Combustion Dept. of Petroleum Cooperation and Dept. of Concession ASEAN affair Construction Project Dept. of Nuclear Stone Mining Management Science & Dept. of Technology Dept. of Planning Dept. of Industrial Mining Business Petroleum Dept. of Energy Resources Techniques & Dept. of Mining Promotion & Business Policy Operation Development Inspection Dept. of International Petroleum Affairs Figure 6: Structure of Ministry of Mines and Energy26 26 RGC (2018). Sub-degree No 137 ANKrBK on Organization and Functioning of the Ministry of Mines and Energy, Phnom Penh, Cambodia. Climate Change Action Plan for Energy Sector 2021 - 2023 19 Informal Translation B. Analysis of Potential Sources and Volume of Finance for Climate Change Actions B.i. National and MME Budgeting Since 2017, Ministry of Economy and Finance (MEF) has introduced climate change in annual budget guidance circulars for line ministries to include in their Strategic Budget Plan. Key ministries have started to integrate climate change in the way they prioritize activities for the national budget. In 2018, The government has dedicated around 1% of GDP in public expenditure to respond to climate change based on the regular public expenditure review. The MEF has included climate change as a consideration in the national budget guideline and played an important role in mobilization and management of external and domestic resources for the climate change response. The government has built a conducive dialogue with the private sector to create an enabling environment for green investments and green finance. B.ii. Financial mobilization mechanism Aside from the national budget, MME has already established partnerships with a number of donors and development partners on climate change related issues. The work of financial mobilization is led by respective general directors and approved by the Minister. B.iii. Potential Sources and Volume of Finance Climate Change Actions The present CCAP is estimated to be 283,214,440 USD over a 3-year period. Large part of the funds for the CCAP will be financed through the current development partners of MME. Of the 283,214,440 USD, the amount already raised is 197,964,675 USD, equivalent to 69.90%. This funding was provided by ADB in form of a Concessional Loan of approximately USD 127.8 million, and the grant from the Strategic Climate Fund of approximately 4,700,000 USD. Clean Energy Fund granted approximately 2,000,000 USD. Royal Government has contributed 28,951,502 USD through tax exemption, and EDC provided 30,2011,519 USD as co-finance. Other multi-donor modality consisting of SIDA, UNDP and EU are supporting the Cambodia Climate Change Alliance with total current funding of USD 12.8 Million for 2019-2023. The dedicated/global funds for climate change i.e., CIF, GEF, LCDF, AF, FCPF, and UN-REDD are potential sources of finance for implementing CCAP of MME. Dedicated/global funds for climate change are expected to play a more important role as their funding scales are expected to get larger. In addition, key bilateral partners supporting MME on climate change work are Agence Française de Développement (AFD), Germany (through GIZ), USAID, JICA, KOICA, China Aid, UKAID, and SIDA. Alternatively, co-funding may be sought from specialized climate funds (Adaptation Fund, Green Climate Fund, GEF/LDCF, Nordic Development Fund), to cover the climate-proofing of traditional projects, or dedicated climate change projects. UN agencies, such as UNDP or UNIDO, may be in a position to support resource mobilization for some of the ‘soft’ activities, and provide technical and capacity development services. Several NGOs are also very active in the renewable energy sector. Policy and capacity development support, as well as funding for innovative activities, can also be mobilized through the Cambodia Climate Change Alliance, or the Global Green Growth Institute. The potential for carbon-credit financing of mitigation initiatives should also be explored, with technical support from the Climate Change Department of the General Secretariat of the National Council for Sustainable Development. Climate Change Action Plan for Energy Sector 2021 - 2023 20 Informal Translation B.iv. Entry Points for Climate Change Mainstreaming in Management and Financing Dedicated CCAP actions will be included in the annual revision of the PIP, starting in 2020 for the 2021 – 2023 PIP. Representatives of energy development department will be in charge of this. At project level, a key action will be to ensure that the screening criteria for any new project development in MME shall include an assessment of climate relevancy. If the project is found to be climate relevant, they need to ensure that specific measures are included in the project design to contribute to mitigation or adaptation objectives. Advocacy on this issue will target both technical and planning departments involved in the review and formulation of new projects. There is currently no significant domestic capital budget (except for counterpart funds) allocated to the mining and energy sectors. When MME adopts a program-based budget, CCAP actions shall be included in the program budgets for co-funding through the national budget. V. MONITORING AND EVALUATION Monitoring and evaluation (M&E) of this CCAP is aligned with Cambodia’s M&E Framework for Climate Change, established by the CCCSP, as well as with the NSDP indicators on climate change. The framework encompasses four main types of indicators, which will be measured on a yearly basis, as indicated in Table 4 below. Table 4: Indicator for Monitoring and evaluation Indicator Type Purpose Frequency 1. CCAP delivery and Tracking the progress of Annual mainstreaming fundamental aspects of MME CCAP’s implementation, such as fund mobilization 2. Institutional readiness Tracking progress in improving Annual institutional capacities including the ability to mainstream CC into the MME’s broader policy and planning instruments 3. Results Assessing the results of actions Annual, or depending on the nature of the action27. 4. Impact Assessing the progress towards Annual, ad-hoc for ultimate climate policy and indicators that require development objectives specific studies Note that CCAP delivery indicators, though partially overlapping with other institutional readiness and result indicator part of other M&E framework, stills provide a summary view of MME’s success in implementing CCAP and they also facilitate a comparison with CCAP implementation across sectors. The full set of indicators which are part of this CCAP’s M&E framework is presented in Table 5 below. 27 Given that most actions will require formulation of project proposals to access the funds required for implementation, the indicators identified are preliminary and will be adjusted to reflect the actual scope of the action. Only indicators related to actions that have been funded for implementation will be monitored. Climate Change Action Plan for Energy Sector 2021 - 2023 21 Informal Translation Table 5: CCAP’s M&E framework indicators MME CCAP M&E System Indicator Units 1. CCAP delivery Actions successfully funded Number Degree of inclusion of CCAP actions into PIPs Number and MME Budget Strategic Plan (BSP) 2. Institutional readiness Status of development of climate robust % (ladder approach) energy policy and planning Coordination of CC response and CCAP % (ladder approach) implementation Status of climate-related information % (ladder approach) management 3. Result indicators Action 1  Degree implementation of the master plan % of RE energy in Review and update generation mix. Cambodia energy development master plan. Action 2  Degree implementation of the policy and Score card (ladder Review and update action plan for energy efficiency approach) national energy efficiency policy. Action 3  Renewable energy shared in the energy  % of RE energy in Strengthen the production mix generation mix. capacity and stability  Greenhouse gas emission avoided  Amount GHG of substations and transmission lines.  Number of additional substations emissions  Length of transmission line built  Number  Length Action 4  Report on climate change risk for power  Number Conduct climate risk infrastructures with recommendations for study for Cambodia future implementation power system and provide recommendation for future implementation. Action 5  Number of GHG inventory report published  Number  Establish national Number of Energy Balance Report  Number greenhouse and published energy reporting system for GHG inventory and energy balance. Action 6  Number of micro grid for villages  Number  Provide the remaining Number of HH access to low carbon  Number and remote off-grid electricity villages and household Climate Change Action Plan for Energy Sector 2021 - 2023 22 Informal Translation with low carbon energy. Action 7  Number of EE Projects including NAMAs  Number Develop and under implementation implement energy efficiency projects to support NEEP implementation. Action 8  Number of laws, policies and regulation for  Number Develop and energy efficiency standard and labelling implement Energy program Efficiency Standards & Labelling Program to  Number of products tested and labelled support NEEP implementation. Action 9  Number of study report published  Number Conduct study on Number of energy project for sustainable clean and sustainable source of energy for cooking energy for cooking and implement the best available options for cooking. Action 10  Number of sustainable thermal and steam  Number Conduct study on business model launched sustainable business model to introduce efficient and clean thermal energy for all sectors. Action 11  Number of industry and large buildings  Establish energy participated in energy saving program. management program for large buildings and factories and voluntary scheme for SMEs for NEEP implementation. Action 12  Level of capacity of government and  Score card (ladder Implement capacity interested parties on RE and EE improved. approach) building in the renewable energy and energy efficiency. Action 13  Number of programs on public awareness  Number Raise public on energy saving developed and promoted.  score card (ladder awareness on energy  Level of understanding about energy saving approach) saving. of the public. 4. Impact

1 Public awareness of CC/Energy issues Survey

2 Mainstreaming climate change/energy issues Number into national and subnational plans

3 Vulnerability Index -

4 Sector’s carbon intensity (carbon intensity of CO2e/Btu energy supply)

5 Carbon credits issued from carbon offset number projects Climate Change Action Plan for Energy Sector 2021 - 2023 23 Informal Translation Additional result indicators for monitoring progress in the implementation of specific actions are provided in the action fiches presented in Annex. A final evaluation will be conducted in mid-2023, to inform the development of the next round of the CCAP. The evaluation will assess the progress in implementing the CCAP and its relevance and contribution to addressing climate change impacts on the energy sectors, as well as alignment with and contribution to achieving the objectives set in the CCCSP 28. The evaluation will also provide recommendations for future adjustment of the policy response. The General Department of Energy (GDE) of MME will be responsible for regular monitoring and evaluating of CCAP’s implementation (with at least one M&E report per year). VI. CCAP AND GENDER Climate change effect will be inevitably magnified for the most vulnerable groups especially the minority people, the elder, the disable and gender, especially women and girls disproportionately. The areas where women play a central role – food security, nutrition, energy, livelihoods, health, natural resource management, among others – are those most directly impacted by climate change. By magnifying gender inequality, climate change also reinforces a structural root cause of violence against women and girls29. Mitigation priority actions, including access to clean energy for cooking and electricity have linkages to gender equality and social inclusion and the potential to contribute to several gender-based indicators. The MME’s priority action plans on energy and gender include: (1) access to energy in rural areas and (2) diversification of household and community energy generation sources to reduce reliance on biomass. Women are often responsible for household energy-related decisions in rural areas and women, the poor and the marginalized are often the last to gain energy access. Gender-responsive mitigation actions and indicators will help measure these changes and also contribute to measuring the success of Sustainable Development Goal 5, CEDAW commitments and CCCSP. VII. LEGAL REQUIREMENTS To fulfil the mandates of Ministry of Mines and Energy, a number of legal provisions have been developed to ensure effective leading and management of energy sectors including petroleum, natural gas, and electricity of Cambodia. Law on Electricity of the Kingdom of Cambodia was promulgated by Royal Decree No. NS / RKAM / 02/2001/03 dated 02 February 2001. Law on the First Amendment to Article 9 of the Electricity Law of the Kingdom of Cambodia by Royal Decree 28 http://www.camclimate.org.kh/en/documents-and-media/library/category/127-national-strategic- plan.html?download=474:cambodia-climate-change-strategic-plan-2014-2023-en-final 29 Gender, Climate change, Health WHO: https://www.who.int/globalchange/GenderClimateChangeHealthfinal.pdf?ua=1 Climate Change Action Plan for Energy Sector 2021 - 2023 24 Informal Translation No. NS / RKAM / 0607/015 dated 22 June 2007 and Law on the Second Amendment to Article 3, Article 4, Article 5, Article 26, Article 27, Article 27, Article 28, Article 42 and Article 74 of the Law on Electricity of the Kingdom of Cambodia was promulgated by Royal Decree No. NS / RKAM / 0515/005 dated 18 May 2015 had set forth the main goal of the law which aimed to govern and to provide a framework for the electric power supply and services throughout the Kingdom of Cambodia. This law covers all activities related to the supply, the provision of services and uses of electricity and other associated activities of power sector. The new Article 4 of this law states that the MME should promote efficiency in generation, transmission, distribution and consumption of electricity, and take action to create a Comprehensive Electricity Conservation Program for Cambodia, as well as electricity sector emergency and energy security strategies. This article supports the reduction of GHG emissions through improving energy efficiency which is directly linked to the CCAP. In addition to the existing supporting regulations, the implementation of CCAP will possibly require adjustments in the existing legal framework and/or the development of new regulations based on the need and evidence from implementation. The potential regulation development is on Renewable Energy and Energy Efficiency to boost GHG emission reductions and to increase equity on energy accessibility. VIII. CONCLUSION The Ministry of Mines and Energy highly appreciates the Climate Change Action Plan 2021-2023 as a basis for national policy implementation on climate change of energy sector. Based on the priority strategies defined above, there are specific strategies and actions which will support the achievement of the national strategic plan, visions, goals, and missions of climate change of energy sector. These strategies also indicate the importance of triple-dimension approaches for the interests of Cambodian society, economy, and environmental integrity as a whole. At the end of the action plan implementation period, evaluation of performance will be conducted to document lessons learnt and to identify new areas of intervention in energy sector. Climate Change Action Plan for Energy Sector 2021 - 2023 25 Informal Translation

Annex I: Action Fiches 1) MME ACTION FICHE No 1 Review and update Cambodia energy development master Action plan. CCCSP S01: Promote climate resilience through improving food, water and energy security. CCCSP and Sector CCSP Strategic CCSP 01: Policy Development in Energy Sector to meet Objective SEforALL target ensuring the key goal of the energy sector development, which is to supply adequate, reliable and low- cost energy sources to compete with neighboring countries. The overall objectives of the project were to review the existing Cambodia Power Development Master Plan and established a revised one. And it was included to establish appropriate methodologies for forecasting electricity demand, power supply plan, and transmission and distribution development Rationale plan. The Master Plan for the Development of the Energy Sector in Cambodia is a key roadmap for managing and developing the energy sector to plan towards a sustainable, reliable, high- quality and affordable power supply for all consumers everywhere throughout the Kingdom of Cambodia. Category of climate change  Cat 1–Re-scaled  Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation Short description: The Ministry of Mines and Energy has led and cooperated with the Electricity Authority of Cambodia, Electricité du Cambodge (EDC) and other relevant institutions to prepare and develop a master plan for the development of the electricity sector in Cambodia to be correct and accurate to the RGC. The preparation of this master plan update is divided into 3 main stages as follows: STAGE 1: Electricity demand forecast for 2020-2040 on the basis of: 1) - Increased actual electricity demand 2) - Global impact of Short description of the action Covid-19 disease on electricity consumption and economy in and expected results and Cambodia and 3) - The growth of large buildings in Cambodia. benefits This electricity demand forecast is divided into 3 options: 1- Business As Usual (BAU), 2- High Case and 3- Low Case. STAGE 2: Power supply source development plan based on: - By showing the amount of energy produced and the power capacity from each source which is divided into two seasons in each year. Schedule the Date of Commissioning (COD) of each power plant project. - Set the reserve margin of electricity supply sources based on: 1- Changes in electricity demand due to changes in GDP and climate change impact, and 2- Climate Change Action Plan for Energy Sector 2021 - 2023 26 Informal Translation Changes in electricity supply, including power outages from the power plant and water change. - Determine the characteristics and conditions of the selection of any power plant project based on 1- Energy coefficient between dry season and rainy season 2- Low electricity cost 3- Power generation capacity and production volume of each energy source potential and 4- Minimum environmental and social impact STAGE 3: Power transmission and distribution network development plan: - Study and analyze power flow of the power transmission system, determine characteristics and conditions of the selection of the power transmission network project to ensure the power supply system is stable, secure, and affordable and have quality. - Study options for importing electricity from neighboring countries and ASEAN countries. - Evaluation of results of the transmission network plan using computer software as well as training. - Expected results and benefits: - Report on energy demand, including industry, commerce and residential in line with the growth of electricity consumption and economy. - The plan for the development of electricity supply sources includes: 1-Development of technical and economical electricity supply sources, 2- buy electricity from neighboring countries and ASEAN region, and 3-Organize various power sources to help each other. - Development plans for the transmission network include: 1. Development of potential power sources at various locations to be integrated into the national grid system; 2. Management and acceptance of various power sources according to time and season to be consistent. According to the size of demand for each time and 3-Transform and send electricity sources to the capital - provinces and regions through sub-stations to supply electricity to consumers. - Set level of the amount of renewable energy in the generation mixture of local power supply sources. The Master Plan of energy sector development is an important document to guide the power development in the country to avoid blackout and unnecessary investment on Cost effectiveness of the action generation plants. The master plan evaluates future energy demands based on medium to long term scenarios of socioeconomic, technological and demographic development. Climate Change Action Plan for Energy Sector 2021 - 2023 27 Informal Translation - Commitment of top management; - Collection and compilation of energy data Preconditions needed for - The capacity of ministry staff and experts to project the successful implementation energy demand in various scenarios. - Level cooperation from different stakeholders. - Timely financial and technical support. Updated Energy Sector Development Master Plan Approved Indicator(s) of success by the Royal Government of Cambodia Implementation General Department of Energy of MME in collaboration with arrangements other stakeholders such as EDC and EAC. Estimated total cost $ 2,340,400 Possible funding sources ADB and National Budget Timeframe 2019-2021 2) MME ACTION FICHE No 2 Action Review and update national energy efficiency policy. CCCSP S01: Promote climate resilience through improving food, water and energy Security CCCSP and Sector CCSP Strategic CCSP 01: Policy Development in energy sector to meet Objective SEforALL target ensuring the key goal of the energy sector development, which is to supply adequate, reliable and low- cost energy sources to compete with neighboring countries. In Cambodia, energy efficiency policies and activities were drafted in 2013 with the support of the EU-EIPDF and revised in 2017 with the support of GIZ. This policy is based on old data from 2010. In November 2015, the Asian Development Bank (ADB) approved technical assistance for capacity building in the Greater Mekong Subregion to support sustainable electricity development, economic efficiency and reduce environmental and social impacts to also respond to climate change in the Mekong subregion. Within the framework of Technical Assistance (TA) of the Asian Development Bank, this energy efficiency project is a joint Rationale effort of three countries: Cambodia, Myanmar, and Laos PDR, members of the GMS countries, with three ministries representing the government of each country participate in this project, such as 1-Ministry of Mines and Energy representing Cambodia, 2-Ministry of Energy and Mines representing Laos and 3-Ministry of Industry representing Myanmar. For Cambodia, the Ministry of Mines and Energy has been working with the Asian Development Bank (ADB) to update its national energy efficiency policy, which is scheduled for completion in 2021. The objectives of this project are to study and evaluate energy efficiency market Climate Change Action Plan for Energy Sector 2021 - 2023 28 Informal Translation and formulate policies, strategic plans, and mechanisms for the implementation of energy efficiency and energy-saving programs, as well as to develop standards, regulations, measures to manage electricity consumption and human resource capacity building. Category of climate change  Cat 1–Re-scaled Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation Short description: The actions needed to develop EE policy are: - Establish inter-ministry technical working group to review and revise the content of the draft national energy efficiency policy. - Conduct survey for data collection and analysis from residential, commercial, industry and transport sector, etc. - Develop strategic plans, policies, action plans, Short description of the programs, and management mechanisms, M&E action and expected results Framework to monitor and evaluate energy efficiency and benefits in Cambodia to analyze and solve sustainable problems. Expected results and benefits: - Policy, strategy, and action plan to guide the development on energy efficiency will be available for government’s institutions and relevant stakeholders, raising awareness and guiding efforts nationally on promotion of energy efficiency. - Increase awareness and efforts to improve energy efficiency. - It will significantly contribute to GHG emission reduction and enhancing of national energy security. Energy efficiency policies and programs benefit and contribute to the achievement of energy efficiency goals that have a positive impact on the economy and society, including GDP growth and employment growth. The quantified benefits include energy savings, air quality Cost effectiveness improvements, comfort benefits and carbon savings of the action benefits, potential health benefits. The number of jobs associated with the policies, with this measurement made for jobs ‘supported’, rather than an estimate of any net change in employment levels (jobs created). - Commitment of top management; - Legal framework and institutional arrangement need to be improved. Preconditions needed for - The capacity of ministry staff and experts to project the successful implementation energy demand in various scenarios to reduce energy intensity. - Level of cooperation from different stakeholders. - Timely financial and technical support. Climate Change Action Plan for Energy Sector 2021 - 2023 29 Informal Translation - Progress of policy, strategy and action plan development and approval. Indicator(s) of success - Number of dissemination workshops conducted and communication materials on document produced. Dept. of Energy Techniques & Business Policy, Ministry of Implementation Mines and Energy (MME) in collaboration with other arrangements stakeholders as well as other departments of Ministry of Mines and Energy Estimated total cost $ 1,934,27 Possible funding sources ADB and National Budget Timeframe 2021-2023 3) MME ACTION FICHE No 3 Strengthen the capacity and stability of substations and Action transmission lines. CCCSP SO2: Reduce sectoral, regional, gender vulnerability CCCSP and Sector CCSP Strategic and health risks to climate change impacts Objective CCSP SO2: To promote the energy infrastructures to be climate proof or climate resilient. The Asian Development Bank (ADB) has provided loans and grants to Electricité du Cambodge (EDC) for enhancing capacity of substations and transmission lines (Grid Reinforcement Project) in Phnom Penh, Kampong Cham, Kampong Chhnang, and Takeo provinces, and the installation of battery energy storage systems. (BESS) at National Solar Park substation: 1. Grid Reinforcement Project Rationale 2. Construction of substation and transmission line in Phnom Penh 3. Construction of substations and transmission lines in Kampong Chhnang, Kampong Cham and Takeo provinces 4. Install a 16 MWh battery energy storage system (BESS) at National Solar Park substation in Teuk Phos district, Kampong Chhnang province. Category of climate change  Cat 1–Re-scaled Cat 2–Modified Cat 3– Dedicated action Type of action Mitigation and adaptation Short description: To strengthen the capacity of substations and transmission lines, some important activities to be implemented are as follows: Short description of the - Prepare loan application procedure for power action and expected results transmission system capacity enhancement project and benefits in Phnom Penh, Kampong Cham, Kampong Chhnang and Takeo provinces and grant for the installation of battery energy storage system (BESS) at solar power substation. Climate Change Action Plan for Energy Sector 2021 - 2023 30 Informal Translation - Procurement procedures, recruitment of project implementation consultants (PIC), and selection of suppliers and construction (EPC) - Study on environmental and social impacts of the project - Prepare procedures for cooperation financing agreement between the Royal Government and ADB. Expected results and benefits - Strengthen the capacity and stability of the power supply system in Cambodia - Increase awareness and efforts to improve energy efficiency - A significant contribution to reducing greenhouse gas emissions and strengthening energy security - Strengthen the adaptation capacity of energy systems to climate change The project provides benefits and contributes to achieving energy efficiency goals, including stabilizing power supplies, Cost effectiveness of the action improving the quality of power transmission lines and other additional benefits, as well as carbon savings and enhanced energy security. - Ability of officers and experts to study the project Preconditions needed for - Level of cooperation from other relevant institutions successful implementation - Timely financial and technical support - Renewable energy index in energy production mix - Reduced greenhouse gas emissions Indicator(s) of success - Number of additional substations - Length of transmission line built. Implementation EDC in cooperation with other relevant ministries and arrangements institutions Estimated total cost $ 193,690,000 ADB and National Budget Possible funding sources Timeframe 2021 – 2023 4) MME ACTION FICHE No 4 Conduct climate risk study for Cambodia power system and Action provide recommendation for future implementation. CCCSP SO2: Reduce sectoral, regional, gender vulnerability CCCSP and Sector CCSP Strategic and health risks to climate change impacts Objective CCSP SO2: To promote the energy infrastructures to be climate proof or climate resilient. Given the high cost of electricity infrastructures and high Rationale demand for energy in Cambodia, conducting risk assessment Climate Change Action Plan for Energy Sector 2021 - 2023 31 Informal Translation and identifying prevention measures is contributing to the achievement of government’s energy policy. Category of climate change  Cat 1–Re-scaled Cat 2–Modified Cat 3–Dedicated action Type of action Adaptation Short description: - Assess risks of electricity infrastructures in particular those located in the climate-hazard prone areas and provide policy recommendations - Build capacity on inspection procedures aiming at reducing climate risks of infrastructures and conduct site inspections - Develop national guidelines on the climate proofing of Short description of the electricity infrastructure development action and expected results - Disseminate the assessment results and guidelines to the and benefits owners of the electricity infrastructures and relevant stakeholders. Expected results and benefits Policy and decision makers, as well as investors will have a better understanding of the level of climate risk on electricity infrastructures and will be able to implement measures to address those risks (also contributing to better planning and design of future infrastructure development). The climate risks analysis will provide overall potential impacts of climate change on electricity infrastructures, Cost effectiveness of the action which could be translated into prevention measures, and thus in avoided costs. - This action relies on results from the national climate change vulnerability assessment. - Capacity of the MME staff to comprehend climate change Preconditions needed for risks and potential impacts on infrastructures is essential to successful implementation successful implementation of the action. - Cooperation with the owners of electricity infrastructures is needed to conduct the assessments. - Number of infrastructures assessed - Level of implementation of the risk assessment Indicator(s) of success recommendations - Level of dissemination of guideline on the climate proofing of electricity infrastructure The executing agent is General Department of Energy of Implementation MME in cooperation with MoE, EAC, EDC and other arrangements development partners Estimated total cost $ 322,000 Possible funding sources CCCA, ADB, AFD, CHINA AID, KOICA and JICA Timeframe 2021 – 2023 5) MME ACTION FICHE No 5 Climate Change Action Plan for Energy Sector 2021 - 2023 32 Informal Translation Action Establish national greenhouse and energy reporting system for GHG inventory and energy balance. CCCSP and Sector CCSP Strategic CCCSP S04: Promote low-carbon planning and technologies Objective to support sustainable CCSP 03: Development Implementation of the GHG emission management approach for the energy sector Rationale As a Party to the UNFCCC, Cambodia is obligated to report on its GHG emission. Developing GHG inventories is an essential first step toward reporting on GHG and managing emissions. A GHG inventory in energy sector is also an element of the required National Communications to the UNFCCC and is part of the energy balance work. This action is designed to establish GHG inventory system for the energy sector (stationary combustion and mobile sources) and to identify the opportunities reduce greenhouse gas emissions. Category of climate change  Cat 1–Re-scaled  Cat 2–Modified  Cat 3–Dedicated action Type of action Mitigation Short description of the action - Develop capacity of the General Department of Energy and expected results and (GDE) for the design and development of the inventory benefits system (including SOPs, data collection and quality assurance (QA) protocols, etc.) - Provide on the job training on 2006 IPCC Guidelines for National Greenhouse Gas Inventories - Identify and acquire hardware and software (including training on the use of software) - Conduct inventory data collection (stationary combustion and mobile sources) including improving data compilation, data gaps and analysis - Conduct studies to develop emission factors for energy sector. - Identify financing options necessary for ensuring sustainability of GHG inventory activities for the energy sector - Share information via workshops to engage other ministries and relevant stakeholders. - Provide timely reporting to the national focal point for the GHG Inventory at the NCSD Secretariat - Study mitigation options (including CBA), including the promotion of technologies aiming at increasing efficiency or replacing fuel wood or charcoal such as efficient cook stoves, bio digesters, solar lanterns, wind water pumping, and ceramic water filters. - The action will result in reliable, good quality activity and emission data, enabling better estimations of future energy demand and emissions and identification of opportunities for emission reductions from the sector. Cost effectiveness It is mandatory for Cambodia as a Party to UNFCCC. Climate Change Action Plan for Energy Sector 2021 - 2023 33 Informal Translation of the action Furthermore, the GHG inventory will help Cambodia to manage GHG emissions from the energy sector more effectively, providing useful information to policy makers and investors on potential areas for low carbon development planning and investment. It will also help Cambodia to attract for climate funding earmarked for mitigation projects, as well as to mobilize support from developed countries in terms of technical assistance and technology transfer. Preconditions needed for Active cooperation between Ministry of Mines and Energy successful implementation (MME), the Ministry of Public Works and Transports (MPWT) and NCSD Secretariat. Indicator(s) of success - GHG Inventory system for energy sector established - Formulation of the baseline emissions between the year 2016 and 2050 based on the most recent available data and projections of future demand - Number of mitigation options identified - Level of capacity improved in GHG inventory system Implementation The executing agent is the GDE of MME in cooperation with arrangements MPWT, MoE, EAC, EDC and other development partners Estimated total cost $ 576,000 Possible funding sources Bilateral donors, USAID, UNDP, JICA, ADB, UNEP, UNFCCC, IGES, GEF, and CCCA Timeframe 2021 – 2023 6) MME ACTION FICHE No 6 Provide the remaining and remote off-grid villages and Action households with low carbon energy. CCCSP SO4: Promote low-carbon planning and technologies CCCSP and Sector CCSP Strategic to support sustainable development Objective CCSP SO3: Implementation of the GHG emission management approach for the energy sector At the end of 2019, Cambodia has 364 REEs who are licensed to provide electricity supply in the country. The license area covers 14,095 (99.48%) villages among a total of 14,168 villages where 73 villages are outside the license zone. Out of the 14,095 villages in the license zone, 13,131 villages are already electrified with national grid electricity while 964 villages are not yet electrified. Thus, a total of 1,037 villages Rationale are not yet electrified. According to EAC, 794 will be connected to national grid in 2020, while the remaining 243 villages are difficult to reach. Among these 243 villages that are difficult to reach, 97 villages are remote and with scattered households; 55 villages are without road access; 50 villages are on islands; 34 villages are floating villages, and 7 villagers are rainy season flooding villages. Climate Change Action Plan for Energy Sector 2021 - 2023 34 Informal Translation The difficult to reach village and household will be provided with solar energy with two possible options including solar home system (SHS) and solar micro grid. Category of climate change Cat 1–Re-scaled Cat 2–Modified  Cat 3–Dedicated action Type of action Adaptation and Mitigation Short description: - Conduct study on status of electrification of the remote village and feasibility of proposed options including SHS and micro grid and other low carbon technologies. - Project concept note development and tendering technical document - Public tendering for suppliers. Short description of the - Monitor and evaluation of service provision. action and expected results - Report the results and GHG reduction. and benefits Expected results and benefits: - Achieve 100% electrification target - Standard of living of people in the rural area increased. - Job creation - GHG reduction - Better health and security - Data for policy and decision makers. - Attract investors to the country. Solar is the cheapest source of energy now compared to other available sources of energy in the country. In the BAU scenario, SHS is more expensive than the baseline of diesel generator. The baseline assumes the use of diesel generators in village charging stations to charge rechargeable car batteries, which in turn supply low-voltage electricity for the households. This approach results in baseline generation costs of USD 0.40 per kWh. In comparison, SHS energy costs in the BAU scenario is estimated at USD 1.17 per kWh. This means that electricity from SHS without derisking requires a price premium of USD 0.77 per kWh over the baseline energy technology mix. For the post-derisking scenario, the cost of Cost effectiveness of the electricity from SHS reduces slightly to USD 1.08 per kWh. action This is USD 0.68 higher than electricity costs in the diesel generator baseline. This indicates that when implementing government interventions to derisk the investment environment, electricity from SHS becomes more affordable, but overall electricity costs from SHS remain significantly higher than electricity from the diesel generator baseline (from an electricity generation point of view). Households spend around USD 0.60 to 0.75 per charge, depending on size of battery, typically around 50-70 Ah. Charging frequency depends on energy needs of the household but is typically 1- 3 times a week. However, grant support from the project, it is expected to lower the cost of electricity from SHS further. Climate Change Action Plan for Energy Sector 2021 - 2023 35 Informal Translation In practice, Rural Electrification Fund has provided up to 100 USD per SHS system subsidy. This will bring down the cost by around 30% further. With new technology of LiFePO4 battery, it is expected that the HH does not need to replace their battery in 10 years. - This action relies on willing to co-finance from the HH for solar home system and micro grid. - Level of capacity of local community is needed for micro grid operation and control. - Commitment from top management is needed to ensure speedy implementation. Preconditions needed for - Support from local authority, community is a must in term successful implementation of facilitation of installation, land use for the micro grid, fee collection for maintenance. - Available of maintenance shop at the local level is needed for repairing the system or preventive maintenance. - Support form electricity supply license holder is needed to prevent conflict. - Number of micro grid deployed - Number SHS installed. Indicator(s) of success - Number of HH raised out of poverty - Number of SHS and micro operational after 5 years. The executing agent is the Department of Renewable and Implementation Other Energy of MME in cooperation with MoE, EAC, EDC, arrangements REF and other development partners Estimated total cost $ 74,911,765 Possible funding sources CCCA, ADB, KfW, China AID, KOICA and JICA Timeframe 2021 – 2023 7) MME ACTION FICHE No 7 Develop and implement energy efficiency projects to Action support NEEP implementation. CCCSP S04: Promote low-carbon planning and technologies to CCCSP and Sector CCSP support sustainable Strategic Objective CCSP 03: Development Implementation of the GHG emission management approach for the energy sector Cambodia is committed to decoupling carbon emissions from economic growth and is making efforts to keep on the path of low carbon resilient development, thus generating additional sustainable development gains. In order to promote GHG emission reduction, Cambodia is actively engaged in establishing the enabling conditions Rationale necessary for the functioning of a number of market-based, carbon offset credit mechanisms which have been established under The UNFCCC, including the Clean Development Mechanism (CDM) first established by the Kyoto Protocol. Other project and program carbon finance crediting mechanisms include the Joint Crediting Mechanism (JCM), Reducing Emissions from Climate Change Action Plan for Energy Sector 2021 - 2023 36 Informal Translation Deforestation and Forest Degradation (REDD+), and Nationally Appropriate Mitigation Actions (NAMA). In the energy sector, there is potential to develop NAMA project including hydro, biomass (waste agricultural biomass to energy, brick kiln, cook stove, industrial stoves efficiency), solar energy, biogas energy, wind, clean coal technology, combined heat power generation, municipality waste management, addressing electricity distribution losses, etc. Category of climate change  Cat 1–Re-scaled  Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation This action will focus on the establishment of NAMAs in the energy sector, each specific field in the energy sector requires technical expertise with analytical capacity at national level, which in part can be supplemented by harnessing domestic technical institutions and experts. This action comprises the following activities: - Assess framework conditions and strategies and identify mitigation opportunities in the energy sectors (in coordination with the implementation of Action 4) - Evaluate technical emission reduction potential, co- Short description of the benefit & co-costs action and expected results - Select NAMA ideas and benefits - Identify NAMA objectives and select mix of instruments - Define baselines - Design MRV Plan - Detail the NAMA planning - Identify needed resources - Support to project implementation The action is expected to attract the technical and financial support from developed countries and from private investors towards low carbon development. It will also improve better planning of low carbon energy development in Cambodia. - This action is part of Cambodia’s commitments under the UNFCCC. - it is expected that it will contribute to attract funding for the implementation of NAMA projects (both from Cost effectiveness of the domestic and international sources), as well as support action from developed countries in terms of technical assistance and technology transfer. - It is expected that gains from setting up monitoring, reporting and verification (MRV) system will far outweigh the investment made. Climate Change Action Plan for Energy Sector 2021 - 2023 37 Informal Translation - Leadership and commitment of MME to promote and achieve low carbon development objectives, placing high on the agenda the approval of the legal framework for GHG emission reduction mechanisms and the establishment of a Preconditions needed for quality MRV and Registry system. successful implementation - Progress made in the establishment of the GHG Inventory System - Capacity building of the staff of MME - Timely technical and financial supports - GHG emissions avoided - Number of NAMA projects developed Indicator(s) of success - Low carbon energy integrated in national energy balance and outlook - The executing agent would be the Energy Development Implementation Department in MME, in cooperation with MoE, Private arrangements Sector, government institutions, and development partners. Estimated total cost $ 600,000 ODA, UNDP, GEF, Green Climate Fund, Nordic Development Possible funding sources Fund and JICA, KOICA and other development partners. Timeframe 2021 – 2023 8) MME ACTION FICHE No 8 Action Develop and implement Energy Efficiency Standards & Labelling Program to support NEEP implementation. CCCSP and Sector CCSP Strategic CCCSP S04: Promote low-carbon planning and technologies Objective to support sustainable development CCSP 03: Implementation of the GHG emission management approach for the energy sector Rationale So far there is no energy efficiency standard and labelling program yet to be operational in Cambodia. However, there was initiative in 2010 to establish the standard and labelling for electrical appliances by Promoting and Demonstrating Energy Conservation in Siem Reap project of Climate Change Department of Ministry of Environment. The project is funded by EEP Mekong as part of climate mitigation program for Mekong countries. In this project, the energy efficiency label of imported electrical appliances to Cambodia are translated directly into Khmer language to ensure the local can choose energy efficiency products for their use. However, there was no standard and testing facility established during this project. In 2013, another initiative for energy efficiency standard and labelling is from the ASEAN Japan Energy Efficiency Program Scheme 3 under coordination from ASEAN Center for Energy (ACE). In this support a regulation on EE S&L for Air Conditioner is established with study on market Climate Change Action Plan for Energy Sector 2021 - 2023 38 Informal Translation potential and energy saving potential if the standard and labelling program was in place. However, it is still in the development stage. In 2014, as part of the ASEAN+3 Mitigation Cooperation Programme, the Mitigation Capacity Building Workshop in Korea and a Policy Consultation on Energy Efficiency Standards and Labelling (EE S&L) for Cambodia are put into the agenda of support for Cambodia by Korea aiming at strengthening the cooperation of ASEAN+3 Member States in GHG Mitigation, capacity building and information sharing on GHG mitigation, and developing business opportunities on GHG Mitigation. In this support, the regulation was developed with designed of indicative energy efficiency label which were handed over to Ministry of Mines and Energy to proceed for adoption and implementation during the workshop in August 2017. The energy efficiency works under this ministerial decision includes energy efficiency standard and labeling for household appliances, energy efficiency for building (energy efficiency building code), energy audit and mandatory reporting scheme and energy efficiency capacity building. The Ministry of Mines and Energy plans to mobilize all resources, including technical assistance, to complete or further improve regulations on energy efficiency standards and labeling to ensure that they are within the framework of the national energy efficiency policy implementation. Category of climate change  Cat 1–Re-scaled  Cat 2–Modified  Cat 3– Dedicated action Type of action Mitigation Short description of the action Short description and expected results and The following step should be addressed or followed to ensure benefits the establishment of energy efficiency standards and labelling is successfully development and sustainably implemented: - Step 1: Decide whether and how to implement energy efficient labels and standards; - Step 2: Develop a testing capability and capacity building for the right people; - Step 3: Design and implement a labelling program and analyze and set standards; - Step 4: Maintain and enforce compliance; and - Step 5: Evaluate the labelling or standards-setting program Expected results and benefits, including number of beneficiaries and type of impact on beneficiaries: Taken together, standards and labels shift the markets to the highest quality, lowest impact appliances and lighting products. Standards drive inappropriate products from the market, protecting consumers and levelling the playing field for manufacturers, distributors, and procurers. Labels draw Climate Change Action Plan for Energy Sector 2021 - 2023 39 Informal Translation consumers and other buyers to the best, most innovative products. Standards will drive inappropriate markets from the market. By setting minimum energy performance levels – or minimally required levels of quality – standards: - Raise the average efficiency or quality of products on the market - Reduce energy costs - Reduce greenhouse gas emissions - Protect consumers - Improve market efficiency & competition - Labels inform smart choices on the best products. To help the best products stand out, labels: - Recognize best products - Describe product performance & quality - Drive competition & innovation Economic Impacts: The economic impacts alone of switching global markets to energy-efficient lighting, appliances, and equipment are staggering: - $350 billion in reduced electricity bills - $500 billion in spending on energy efficient products by 2035, representing a booming market Cutting Carbon: Recently implemented appliance efficiency standards among 18 major economies in the world are expected to save over half a gigaton of CO2 in 2030. However, appliance standards can do much more – if all Cost effectiveness of the new appliances and equipment sold in major economies action used the most energy efficient technologies available on the market, the energy saved each year by 2030 would equal nearly 16 exajoules—more than 20% of global electricity demand in 2014. Worldwide, 75 countries have adopted energy performance standards and labels. If 18 major economies improved their standards to reflect best available technologies, a further one and a half gigaton of CO2 emissions could be saved in 2030—almost half of the aggregated country commitments for year 2100 set in the Paris Agreement. To date, 19 countries have adopted or are considering adopting quality standards for off-grid appliances or cook stove emissions and safety policies, marking the rapid evolution of these dynamic markets. Climate Change Action Plan for Energy Sector 2021 - 2023 40 Informal Translation Research is needed to calculate the cost effectiveness for Cambodia. Preconditions needed for - Timely financial support successful implementation - Technical support Legal supporting and enforcement - Cooperation from private sector and local authorities Indicator(s) of success - Amount of GHG emission reduced - Number of EE label issued. Implementation General Department of Energy in MME and other relevant arrangements departments and ministries. Estimated total cost $ 2,900,000 Possible funding sources ADB, UNDP, CCCA, JICA, and Other development partners Timeframe 2021 – 2023 9) MME ACTION FICHE No 9 Conduct study on clean and sustainable energy for cooking Action and implement the best available options for cooking. CCCSP S04: Promote low-carbon planning and technologies to CCCSP and Sector CCSP Strategic support sustainable development Objective CCSP 03: Implementation of the GHG emission management approach for the energy sector In Cambodia, biomass energy accounts for around 55% of the energy mix which is the highest proportion in South-East Asia. For domestic cooking, 82% of Cambodian households use wood fuels as their main fuel; 18% of which use charcoal as their primary fuel. Cambodia’s total energy consumption is projected to grow at an average annual rate of 5.2% from 2009 to 203530, and charcoal is expected to continue to represent an important part of the energy mix. While in urban areas the consumption of charcoal is expected to slightly decrease, it is expected to increase by 53% in rural areas between 2012 and 203031. At the national and regional levels, Rationale charcoal consumption is expected to rise until 203032. Therefore, wood fuels, and more specifically charcoal, represent a highly strategic economic sector for Cambodia. However, international and national investments in the sector remain low. One of the reasons could be that charcoal is considered as energy for the poor, to be replaced by LPG (Liquid Petroleum Gas) and/or electricity. This vision has been popularized by Leach33 in the 1990s with the “energy ladder” concept, where households adopt progressively more modern energy sources and reduce traditional wood fuel use as they become wealthier and as cleaner sources of energy 30 Asian Development Bank, « Asian Development Outlook 2013: Asia’s Energy Challenge », April 2013, 978-92-9254- 023-4. 31 GERES, « Residential energy demand in rural Cambodia » (UNDP, 2008). 32 J.E. Michael Arnold, Gunnar Köhlin, et Reidar Persson, « Woodfuels, livelihoods, and policy interventions: Changing Perspectives », World Development 34, no 3 (March 2006): 596‑611, doi:10.1016/j.worlddev.2005.08.008. 33 Gerald Leach, « The energy transition », Energy policy 20, no 2 (1992): 116‑23. Climate Change Action Plan for Energy Sector 2021 - 2023 41 Informal Translation become more accessible. However, recent studies suggest that charcoal is not energy for the poor as it is predominately used in urban areas where higher levels of income are observed34. A survey conducted by GERES in 2013 on 1,969 households35, representative of the Cambodian population, shows that the share of households that use charcoal as a primary fuel does not decrease with an increase in wealth. This fact is also observed in Phnom Penh, where LPG is most widely available, and is in line with observations made in other developing countries36. In this regard, sustainable source of fuel wood for charcoal production is necessary for sustainable consumption of the resources. Category of climate change  Cat 1–Re-scaled Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation Actions: - Conduct study on clean energy source for cooking. - Develop a baseline for potential analysis. - Pilot the sustainable way of charcoal production. - Develop regulation for sustainable charcoal production. - Implement the regulation and enforce it. Short description of the - Monitor the result. action and expected results Expected results and benefits and benefits - The consumption of wood fuel for charcoal production is reduced by 30% or more. - Sustainable sourcing of fuel wood is practice in Cambodia. - GHG emission reduced. - Economic benefit due to better efficiency. - Deforestation is reduced. Sustainable production and supply of charcoal play important roles in food security, including food production, processing, utilization and access to food through income generation. Charcoal is often readily available in local markets compared to other cooking energy options such as electricity or modern liquid or gaseous fuels, particularly in the urban and/or peri-urban Cost effectiveness of the areas in Cambodia. Reliable access to affordable cooking fuels action enables food being well cooked, making it more digestible and enhancing the uptake of nutrients.37. Also, cash income from charcoal production and trade provides means to purchase food or to invest in agriculture production. FAO estimated that about 2,570,400 people in Cambodia, or roughly 18% percent of the HH in Cambodia, use charcoal for primary cooking. GERES estimates that Cambodia’s national 34 Tuyeni H. Mwampamba et al., « Dispelling common misconceptions to improve attitudes and policy outlook on charcoal in developing countries », Energy for Sustainable Development 17, no 2 (2013): 75‑85. 35 GERES, 2013. Nationwide Domestic Use of Cooking Fuels and Devices. Nation-wide baseline Survey. 36 Douglas F. Barnes, Kerry Krutilla, and William F. Hyde, The urban household energy transition: social and environmental impacts in the developing world. (Routledge, 2010). 37 http://www.fao.org/3/a-i6815e.pdf Climate Change Action Plan for Energy Sector 2021 - 2023 42 Informal Translation charcoal production was around 336,000 tons in 201338. Considering an average retail price of 0.35 USD per kilogram, the Cambodian charcoal market would represent more than 117 million USD per year, which makes it a significant economic sector for rural Cambodia. Charcoal production can be integrated in food production systems, such as through agroforestry practices. Studies found that some agroforestry systems can provide wood resources for year-round charcoal production combined with staple agricultural crops39. Furthermore, woodlots and tree plantations established for sustainable charcoal production may provide forest foods, animal fodder and fuelwood simultaneously and contribute to global efforts to halt and prevent deforestation. - Cooperation of relevant stakeholders Preconditions needed for - Commitment of government and interested parties. successful implementation - Available for financial and technical assistance. - Regulation is developed, implemented and followed. - Sustainable charcoal practice is developed, deployed and followed. Indicator(s) of success - GHG reduction - Number sustainable charcoal practice is implemented or followed. Implementation Department of Renewable and Other Energy in cooperation arrangements with NCSD Estimated total cost $ 1,500,000 FAO, GERES, GEF, Green Climate Fund, Nordic Development Possible funding sources Fund and others. Timeframe 2021 – 2023 10) MME ACTION FICHE No 10 Action Conduct study on sustainable business model to introduce efficient and clean thermal energy. CCCSP and Sector CCSP Strategic CCCSP S04: Promote low-carbon planning and technologies to Objective support sustainable development CCSP 03: Implementation of the GHG emission management approach for the energy sector Rationale The most used boiler technology in garment factories to convert wood fuel into thermal energy for the production processes is boiler with different capacity ranging from few 45 kg per hour to 12,000 kg per hour. Boiler with size ranging from 1 to 5 TPH is the most commonly used, which is around 29% of the total boilers followed by boiler size of 0.1 to 0.5 TPH which is around 24%, and boiler size of 0.5 to 1 TPH. The boiler smaller than 0.1 TPH account 38 GERES, 2015. Nation-wide assessment of biomass consumption patterns in Cambodia. 39 Industrial plantations and agroforestry for the benefit of populations on the Batéké and Mampu plateaux in the Democratic Republic of the Congo. Bois et Forȇts des Tropiques, 301 (Bisiaux et al, 2009) Climate Change Action Plan for Energy Sector 2021 - 2023 43 Informal Translation for 16%, while boiler size 5 to 10 TPH and above 10 TPH are 8% and 1%, respectively. According to GERES’s 2017 and 2018 survey40 on 45 factories, wood is the major fuel supply for the steam generation in boiler. The share of different fuels used for steam production in garment factories in Cambodia: wood (73%), heavy fuel oil (HFO) (2%), diesel oil (6%), electricity (19%) LPG gas (0.18%), fabric waste 0.51% and biomass briquette and pallet (0.46%). From the survey, the total wood consumption in Cambodia’s garment industry is estimated at around 1,143,929.64 m3 or 633,891 ton per year in 2017. Category of climate change Cat 1–Re-scaled Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation Short description of the Actions: action and expected results - Undertake boiler assessment in all sectors including industry, and benefits commercial building and other where boiler usage exists. - Potential estimation with technology identification. - Pilot the energy efficient boilers. - Promote the use of energy efficient boilers. - Develop minimum energy performance for boilers. Expected results and benefits: - Boiler database of Cambodia. - Reduce wood and other fuel consumption for steam generation. - GHG reduction - Economic saving due to better efficiency. Cost effectiveness of the Finding from the surveyed factories indicates huge potential action of biomass saving by replacing the existing boilers with the new and more efficient ones. In general, wood boilers that are more than 8 years old has great potential for replacement because the efficiency is very low. In the GERES study, around 33% of total boilers 971 have great potential for replacement in which 237 are wood boilers with different capacity. By considering distribution of boiler size, possibility of improving energy efficiency, potential of wood saving is estimated at 189,873 m3 per year which is around 17% compared with the low efficiency boiler scenario. This requires the investment of approximately 6.5 million USD which will takes about an average payback period of 1.64 years. If this boiler replacement is adopted, the saving of wood could lead to saving emission of GHG of around 180,370 ton per year. Preconditions needed for - Level of cooperation between MME, MISTI, private sectors successful implementation and all interested parties. - Availability of energy efficiency boiler. 40 GERES (2018). FEASIBILITY STUDY OF A CREDIT-LINE PROGRAM FOR ENERGY EFFICIENCY PROJECTS IN CAMBODIA, Phnom Penh. Climate Change Action Plan for Energy Sector 2021 - 2023 44 Informal Translation - Proper legal and regulatory framework to support the work. Indicator(s) of success - Number of boiler data collected and published - Number of energy efficient boilers launched. - Amount of GHG saved. Implementation Department of Thermal and Combustion and other private arrangements sectors. Estimated total cost $ 1,300,000 Possible funding sources UNDP, FAO, AFD, UNIDO, ADB, world bank and other development partners Timeframe 2021 – 2023 11) MME ACTION FICHE No 11 Action Establish energy management program for large buildings and factories and voluntary scheme for SMEs for NEEP implementation. CCCSP and Sector CCSP Strategic CCCSP S04: Promote low-carbon planning and technologies Objective to support sustainable development CCSP 03: Implementation of the GHG emission management approach for the energy sector Rationale Energy use in factories and building has risen in recent years because of the growth in energy intensive industry, large high-rise building with air-conditioning, motors, heating, ventilation, lighting, and other intensive use. However, this trend is offset by considerable improvements in building materials, insulation, plant, lighting and controls as well as the availability of energy management tools to help building owners/property managers to manage their energy usage efficiently. Category of climate change Cat 1–Re-scaled Cat 2–Modified Cat 3–Dedicated action Type of action Mitigation and adaptation Actions: - Conduct Data collection: The most important part of the energy management work is the evaluation of consumption patterns and the identification of specific energy saving measures. This is achieved through energy audits. Energy audits can involve different levels of detail depending on the objectives of the study. The objective was to gather Short description of the action sufficient and relevant information data for complete and expected results and assessment of the buildings and factories being investigated. benefits - Analyze and benchmark development: The data collected was subject to various statistical analysis and correlation from building and factory to system levels. The aim of the analysis was to assess the influence of the independent parameters on the annual electricity consumption, enabling important and critical characteristics to be identified. - Develop Energy audits assessment tool: This methodology can be used as a reference guide for future work as well as Climate Change Action Plan for Energy Sector 2021 - 2023 45 Informal Translation for building or factory owners/managers when carrying out an energy audit. - Develop building energy benchmarking tools: Using the established benchmarking curves developed as a result of the study, the total energy saving potential of a building can be calculated using the total energy performance benchmarking curves. A performance target may be set for a short- or long-term performance of the building and factory. If services system’ energy data are available, a building or factory can also determine the saving achievable from each of the systems using system benchmarking curves. Once the system’s saving potential is established, a building or factory owner can prioritize an energy retrofitting project according to the extent of saving each system can achieve. Energy benchmarking is well recognized as an important tool in identifying the current and future energy requirement of a building or facility. There are available web-based benchmarking systems offered by government and commercial enterprises, but such data is frequently invalidated. Expected results and benefits: - Financial benefits: Recent experience has shown that if energy management programs are implemented in a systematic way, there are significant financial benefits to be gained. Some of the main financial benefits of energy management works are: o Quick payback – about two years for optimization measures and five years for retrofit measures; o return on investment (ROI) – 20-50 % (compared to only about 6 % for bank fixed deposit); and o savings can be used to fund the energy management program. - For building and factory owners and facilities managers, investment in energy efficiency should be treated on the same basis as any other financial decision and should have no more onerous conditions placed upon it than any other investment. The appraisal of energy saving measures should always take into account the wider benefits such as improvements in comfort and the environment. This can usually be achieved using a life cycle costing approach. Therefore, energy management programs should not be considered as environmentally friendly programs which require expenditure but as investments which will bring significant financial returns for an organization while achieving environmental goals. - Energy efficiency leads to better managed buildings and factory: The most obvious benefit of energy efficiency Climate Change Action Plan for Energy Sector 2021 - 2023 46 Informal Translation through a well-planned energy management program is that it lowers running costs, amounting to relatively large savings over the life of the buildings and factories. However, reduced emissions and less use of natural resources have now become more important long-term benefits. Improving energy efficiency can also lead to better buildings and factories with greater comfort, a better working environment, more satisfied occupants and improved productivity as spin-off benefits. Energy efficient buildings need not cost any more to build than a “standard building”. - Availability of training materials related to EE for buildings and factories. - Ministry staff and lecturers from academic institutions with greater knowledge on how to improve EE for building and large factories. - Enable ministry staff to explore other potential EE projects in Cambodia continuously. Cost effectiveness of the action Energy management program for large buildings and factories is a cost-effective way to efficient use of resources and low- cost mitigation options. Preconditions needed for - Level of cooperation between the MME and other interested successful implementation parties especially MISTI, private building owners and factory owners. - Timely technical and financial support - Competent consultants or consultancy firm to support the work Indicator(s) of success - Number of buildings and factories participated in the program - Amount of GHG saved. Implementation Energy Development Department and Department of arrangements Energy Techniques & Business Policy in MME and academic institutions Estimated total cost $ 1,300,000 Possible funding sources UNDP, UNEP, UNIDO, ADB, world bank and other development partners Timeframe 2021 – 2023 12) MME ACTION FICHE No 12 Action Implement capacity building in the renewable energy and energy efficiency. CCCSP and Sector CCSP Strategic CCCSP SO5& CCSP SO4: Improve capacities, knowledge and Objective awareness for climate change responses Rationale The aim of capacity building on RE and EE is to enhance the capacity of government and interested parties to promote the RE and EE in Cambodia. Capacity building is one of the strategies to ensure sustainability of the RE and EE program. Category of climate change Cat 1–Re-scaled  Cat 2–Modified  Cat 3–Dedicated action Climate Change Action Plan for Energy Sector 2021 - 2023 47 Informal Translation Type of action Mitigation and adaptation Short description of the action Short description: and expected results and - Undertake a capacity needs assessment (particularly benefits reflecting the needs of local business and industry groups) - Promote south-south and north-south technology development partnerships - Develop a regional multi-year capacity development framework for key stakeholders in the RE&EE sector (particularly reflecting the needs of local business and industry groups) - Facilitate the adoption and implementation of the regional capacity development framework and mobilize support from various partners - Develop training competency standards, certification and accreditation schemes and models on RE&EE in coordination with local business and industry groups - Act as coordinative hub for the accreditation and certification of national training centers and trainers - Execution of regional training of trainer workshops - Train key policy makers in sustainable energy policy planning and incentive mechanisms, including cross- cutting nexus issues (e.g. waste-to-energy, mainstreaming of environmental assessments and standards in project approval procedures, energy-water-food nexus, gender mainstreaming, decommissioning and recycling procedures for RE&EE technologies) - Training utilities and regulators regarding RE integration/grid stability and energy efficiency (e.g. demand side management) - Provide targeted RE&EE business development training for clean-tech SMEs and entrepreneurs (e.g. energy auditors, equipment installers, RE service providers) - Increase the capacity of stakeholders to mainstream gender, environmental sustainability and climate resilience into RE&EE policies and projects - Train experts on the financial structuring, design and planning of RE&EE projects (e.g. climate finance, RETScreen, HOMER) - Conduct a baseline study on the research priority needs of the Pacific RE&EE industry and business sectors - Create a regional incentive model for the establishment of regional research programmes with high relevance for the local industry Expected results and benefits: - Availability of training materials related to EE and RE in the ministry and academic institutions. - Ministry staff and lecturers from academic institutions with greater knowledge on how to improve RE and EE. - Enable ministry staff to explore other potential RE and EE project in Cambodia continuously. Climate Change Action Plan for Energy Sector 2021 - 2023 48 Informal Translation Cost effectiveness of the Capacity development is a cost-effective way to improve action human resources competency for the need in the area of RE and EE development. Preconditions needed for - Level of cooperation between the MME and academic successful implementation institutions - Timely technical and financial support - Competent consultants or consultancy firm to support the work Indicator(s) of success - Number of training material produced - Number of trainees received training Implementation GDE of MME and academic institutions arrangements Estimated total cost $ 650,000 Possible funding sources UNDP, UNEP, UNIDO, ADB, World Bank and other development partners Timeframe 2021 – 2023 13) MME ACTION FICHE No 13 Action Raise public awareness on energy saving. CCCSP and Sector CCSP Strategic CCCSP SO5 & CCSP SO4: Improve capacities, knowledge and Objective awareness for climate change responses Rationale Energy Saving awareness raising program for the public aims to promote and demonstrate energy conservation and energy efficiency in Cambodia. The main objective of the program is to raise awareness of energy efficiency and energy conservation in the context of climate change and sustainable development, and to demonstrate the practical solutions of simple energy conservation measures that can be implemented directly by the public. Energy Saving Program directly responds to Cambodia’s priorities in renewable energy and energy efficiency, and contributes to national objectives to reduce poverty, achieve energy security and mitigate greenhouse gas emissions. The project targets households, government buildings (government offices, schools, hospitals), and the commercial and private sectors (hotels/guesthouses, restaurants and commercial centres). Category of climate change Cat 1–Re-scaled Cat 2–Modified  Cat 3–Dedicated action Type of action Mitigation & Adaptation Short description of the action Actions: and expected results and - Awareness needs assessment benefits - Public consultation workshops - Development of awareness raising materials in Khmer - Development of website or Facebook pages providing information on energy conservation and energy efficiency in Khmer Climate Change Action Plan for Energy Sector 2021 - 2023 49 Informal Translation - Awareness raising workshops for public buildings (government agencies, schools and hospitals), hotels/guesthouses, restaurants and commercial buildings. - Awareness raising campaign through local media (television, radio, printed press) - Awareness raising campaign in primary and secondary schools Expected results and benefits: - Information on energy conservation and energy efficiency available in Khmer and disseminated - Awareness raising of energy efficiency and energy conservation increased - Greenhouse gas emissions reduced - Electricity consumption for equivalent output level decreased. Cost effectiveness of the Awareness raising is a cost-effective way to improve energy action saving in the country, and it bring real change to the energy consumption for everyone. Preconditions needed for - The executing agency would be the Department of successful implementation Hydroelectricity in MME. - Level of cooperation between the MME and academic institutions - Timely technical and financial support Indicator(s) of success - Number of radio spots run - Number of leaflets, brochures, posters and print materials distributed - Energy savers website developed (with tips on saving energy and money) - Number of awareness raising workshops - Number of participants in awareness raising workshops - Number of television spots run - Number of newspaper advertisements and features published - Amount of GHG emission reductions (CO2) Implementation Department of Energy Techniques & Business Policy and arrangements other departments in MME and academic institutions Estimated total cost $ 1,190,000 Possible funding sources UNDP, UNEP, UNIDO, ADB, world bank and other development partners Timeframe 2021 – 2023 Climate Change Action Plan for Energy Sector 2021 - 2023 50 Informal Translation Ministry of Mines and Energy Building No. 79-89, Pasteur Street (51), Sangkat Phsar Thmei 3, Khan Daun Penh, Phnom Penh Phone: (855) 23 219 574 Email: info@mme.gov.kh Mailbox: 49 Climate Change Action Plan for Energy Sector 2021 - 2023 51