CAMBODIA plans to spend more than US$100 million (RM417 million) on subsidies by 2021 to reduce electricity tariffs and spur economic growth.
The move is also to relieve the financial burden of businesses and households.
Cambodian utility company Electricite du Cambodge (EdC) director general Keo Ratanak told The Phnom Penh Post that the government had already spent some US$95 million (RM396 million) to reduce tariffs this year.
According to Ratanak, EdC generated about US$50 million (RM208 million) in revenue last year through the sale of electricity.
“This year’s earnings could be even higher because of the growing number of consumers, so the government will also have to increase their subsidies,” he said.
The tariff subsidies will be introduced during the next sitting of the General Assembly.
Currently, Cambodian households that consume less than 50kW per month pay on average 610 riel (63 sen) per kilowatt hour (kWh), while commercial consumers pay between 600 (62 sen) and 800 riel (82 sen) per kWh on average.
Rice Federation of Cambodia secretary-general Lon Yeng said the EdC currently sold electricity to the rice processing industry for 600 riel (62 sen) per kWh.
“Electricite du Cambodge may reduce the rate to 592 riel (61 sen) next year, but businessmen want it to be lowered even further to increase manufacturing productivity for the export market,” Yeng said.
He also feared Cambodia’s electricity supply may not be enough to meet the rice industry’s demands, adding that rice mill owners often complained of power cuts during this year’s dry season.
“We have a lot of problems regarding the lack of energy being supplied. It’s not good. Rice mills need constant power to dry grain during the harvest season,” Yeng said.
According to official figures from the Ministry of Mines and Energy, Cambodia consumed a total of 2,650 MW of electricity last year, an increase of around 15 per cent compared to 2017.