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Electricity Authority Clarifies Need For Rooftop Solar Declaration Amid Confusion

Solar panels installed at the Bakheng Water Treatment Plant on the outskirts of Phnom Penh on March 13, 2024. (CamboJA/Pring Samrang)
Solar panels installed at the Bakheng Water Treatment Plant on the outskirts of Phnom Penh on March 13, 2024. (CamboJA/Pring Samrang)

A recent unclear statement by the Electricity Authority of Cambodia (EAC) drew mixed reactions from the public about the solar rooftop self-declaration. The EAC later released a statement clarifying that self-declaration was “only for rooftop solar power consumers” who are connected to the national power grid.

EAC issued a statement on July 4, urging consumers, who installed solar panels and used solar power, to declare their installations. But it did not give specific information about the scale of the solar power generated which might be subject to declaration, further confusing the public. 

To date, the EAC announcement has been shared 1,100 times and garnered nearly 1,000 comments, along with 1,300 “likes”. Many people sought for more information on the scale and what type of solar system needed registering. Some also asked why solar power consumers needed to register, concluding that the EAC’s notifications were causing people to be misinformed.  

After being hit by a barrage of questions from the public, the EAC issued a statement on July 6 to clarify their earlier statement on the self-declaration of rooftop solar. 

It said the Ministry of Mines and Energy worked with the UNDP to develop a solar rooftop system management principle in relation to the electricity system receiving power from the national grid, which required registration. 

However, the registration and management of the rooftop solar system does not refer to the installation of separate solar equipment, which is not connected to the national power grid, such as lamps, pumps, and cookers. 

Rooftop solar consumers who possessed a capacity of above 10 kilowatts were obliged to pay capacity charges. The capacity charge was only for large consumers such as industrial factories, businesses, hotels and large buildings that want to install medium and large solar power systems.

“As such, over 95% of the people who use electricity for their homes and businesses will not be affected by the EAC’s measure,” the statement read. 

On December 15, 2023, the EAC released the first notification. So far, there are 94 self-declaration locations, which have registered to install solar. The announcement this July 4 was its second notice. It had an August 15, 2024 registration deadline. 

According to the notice, if there was no proper registration, management and technical inspection, “electricity leakage” could occur in the supply grid which could endanger the lives of repairmen if the power supply was cut to facilitate repairs on the power poles. 

Meanwhile, the national grid could neither properly invest in anti-vibration devices and arrange for the assembly of power sources nor install energy storage systems to meet the shortage of power sources for consumers in the absence of sunlight. It was also difficult to collect data. 

In order to manage that, the EAC has to first register those with solar systems on the roof, it said, adding that notice had been issued to consumers who have installed the system to declare at the site where they received the supply. They should register and receive an acknowledgment of a permission to install and use, which was in accordance with the law, EAC stated.

Keo Rottanak, Minister of Mines and Energy, said on February 15, 2024 that the policy of installing rooftop solar should be in control to ensure energy stability due to the low exposure of direct sunlight. 

He said if the EAC allowed everyone to install solar panels, there would be cost problems. For example, the government asked the Electricite du Cambodge (EDC) to buy energy from investors abroad to preempt a shortage of electricity supply.

However, when electricity supply is acquired from abroad, citizens who installed solar panels would utilize the electricity only when their panels failed to produce electricity due to a lack of sunlight. If that happens, EDC would have to absorb the loss. 

“That is why the formula stated that when we install solar, we have to contribute to the capacity charge, which is a reserve charge that we can absorb at any time when there is no sunlight by connecting to the national grid,” Rottanak said.

In Vietnam, the government recently approved direct sales of renewable power, including rooftop solar, wind, biomass, micro-hydropower, geothermal, wave, and tidal energy plants, without having to go through Vietnam Electricity as an intermediary. 

Solar panels installed at the rooftop of an apartment in Phnom Penh, July 8, 2024. (CamboJA/Pring Samrang)

Ty Bunly, head of solar technology at SOGE Cambodia, told CamboJA News that the self-declaration policy would help the EAC collect information from solar consumers. If there were many rooftop solar power consumers who also use the national power grid, it might result in electricity instability.

In terms of capacity charge for solar consumers with capacities above 10 kilowatts, he said, while it is not yet known how much the charges would be, large scale solar consumers may experience a negative impact including higher fees as a result of self-declaration.

“It may be one of the reasons why the cost of investing in solar systems would increase. As consumers utilize solar energy to lower their electricity expenses, the requirement to pay for grid services at a higher rate when using solar power could result in increased costs for solar users,” he said. “This factor could impact the decision to adopt solar energy, which is considered clean energy.”

SOGE Cambodia supplies water to farmers using solar energy to pump water. Their solar panels generate between one kilowatt and 362 kilowatts of energy, Bunly said, sharing that his company was preparing to make a self-declaration soon.

Heng Kimhong, president of Cambodian Youth Network, said the authorities should encourage people to use solar energy as it is clean energy and while the government is not yet 100% able to generate and distribute electricity nationwide.

He opined that discussions about raising the cost of solar energy should not happen “when we talk about promoting clean energy”. Kimhong said he “did not support” the EAC’s measure which required rooftop solar power consumers, who connect to the national grid, to self-declare and make contributions.

Oxfam Cambodia said the installation of a rooftop solar power systems is a diversification of energy sources that contributes to the promotion of clean energy and increased energy production. It reduced the load and pressure on the national distribution network, Oxfam told CamboJA News via Telegram.

To raise the use of solar energy, the state should encourage service providers and consumers by providing tax incentives for equipment, as well as low-interest loans to reduce installation costs, it added.

Regarding the EAC’s announcement, Oxfam mentioned that the confusion and lack of understanding about the purpose of the declaration and related terms have caused concern. “If people don’t fully understand the purpose of the self-declaration, it could lead to the discontinuation or non-use of solar energy.”

Following the public reaction, the ministry and EAC explained, with questions being clarified, especially about the purpose of the self-declaration, but a “small number of people remain concerned”, Oxfam observed.

The government should continue to disseminate information, clarify to resolve the confusion, and provide clarity on the conditions that must be met, especially for service providers and people who wish to install solar systems for use.

Ky Sereyvath, economic researcher with Royal Academy of Cambodia, said companies that use solar connected to electricity have to pay a fee to the electricity authority. However, the fee must be calculated in a balanced way, so that “all companies will use solar mixed with electricity”.

Companies (including manufacturers), which use solar energy, can save money when exporting to the United States and Europe with preferential tariffs.

“But if the government makes solar widely available and cheaper, factories would stop using electricity, while EDC enters into long-term foreign purchase contracts,” said Sereyvath. The government should consider finding a suitable time to promote the use of solar systems when the contract expires to contribute to reducing pollution and boosting Cambodia’s exports, he added.

EnergyLab Cambodia said they would respond later next week. UNDP did not reply at the time of publication.