The Asian Development Bank (ADB) has approved $82.5 million for the second phase of Cambodia’s Energy Transition Sector Development Program (ETSDP). The funding — cofinanced by the ASEAN Infrastructure Fund, the Asia–Pacific Climate Finance Fund, the Green Climate Fund and the UK, through the ASEAN Catalytic Green Finance Facility — will drive Cambodia’s clean energy shift through policy reform and investments in innovative technologies.
The first phase, endorsed in 2022, introduced major policy measures that placed Cambodia’s energy sector on a path toward more efficient and renewable growth.
Building on that momentum, Subprogram 2 aims to enhance regulations that strengthen the energy efficiency framework and improve policy clarity to draw in private investment. A key outcome will be the rollout of Cambodia’s first Minimum Energy Performance Standards (MEPS) for electrical appliances, beginning with air conditioners, which represent the highest household energy use.
The new phase will also create an Energy Efficiency Revolving Fund, designed to expand access to finance for small and medium-sized enterprises (SMEs) investing in energy-saving technologies. The fund will work through a financial intermediation model, allowing local banks to provide loans for efficiency upgrades. By engaging with domestic financial institutions and supporting SMEs, this mechanism is expected to significantly accelerate energy efficiency investments nationwide.
“The ADB is honoured to support Cambodia in its ambitious and transformative journey in the energy sector. Through a comprehensive reform package, combining policy support with strategic investments, the Energy Transition Sector Development Program will support turning the government’s ambitious vision into reality,” said ADB acting country director for Cambodia Anthony Gill.
“This includes the goal of achieving 70 per cent renewable energy in the power mix by 2030, along with a strong commitment to advancing energy efficiency, which is essential to ensure that Cambodia’s growth remains both sustainable and affordable,” he added.
Looking ahead, a third subprogram, scheduled for 2027, will further expand the reform agenda, strengthening the regulatory framework for energy efficiency and introducing technical standards for renewable energy, buildings and industry to draw greater private sector participation.
