WSHPDR_2013_Final_Report-updated_version

3.4.3 Lao People’s Democratic Republic
Lydie Mateo, Gregoire Pelletreau and Aurelie
Phimmasone, Laos Institute for Renewable Energy,
Lao People’s Democratic Republic
Key facts
Population 6,586,266 1
Area 236,800 km 2
Climate Tropical monsoon 1
Topography Mountainous landscape
Rain pattern Rainy season: May to November.
Dry season: December to April 1
Electricity sector overview
The responsibility for the energy sector is divided
among various organizations with the Ministry of
Energy and Mines or MEM (formerly the Ministry of
Industries and Handicrafts or MIH), being the most
prominent as it manages the electricity sector through
the Department of Electricity (responsible for power
sector development) and Electricité du Laos (EDL),
which is a state owned enterprise responsible for
electricity supply to the domestic sector. Under the
Electricity Law (Article 43), MEM has the primary
responsibility for policy formulation and strategic
planning, jointly undertaken with the Science,
Technology and Environment Agency, the Committee
of Investment Management and Foreign Economic
Cooperation and other relevant agencies. 2
During the period 1995-2010, Lao People’s
Democratic Republic (hereafter Lao PDR) made
impressive achievements in national electrification
whereby electricity access has more than quadrupled.
Indeed, the ratio of household electricity use had
rapidly increased from 15 per cent in 1995 to 73 per
cent in 2010, surpassing expectations and the 70 per
cent target. The majority of villages have access to
electricity, both on-grid and off-grid. These are
outstanding results for a country with a
predominantly rural population. Thus the country is
on track to achieve its target of 80 per cent national
electrification coverage by 2015 and 90 per cent by
2020. 3 This is in contrast with the data reported in
World Energy Outlook 2011, where it states that the
country’s electrification rate was at 55 per cent for
2009, which was probably due to a difference in
definition of electrification. 4
In order to reach its 2020 target, the Government
pursues an aggressive grid extension programme
complemented by off-grid electrification whenever it
is cost-effective. In parallel, the Laotian Government,
with the support of the World Bank through the
expansion of the Power to the Poor Program from EDL
is also willing to increase the nationwide connection
ratio in areas already covered by the grid, from 80 per
cent to 95 per cent of the households. 5 In addition,
the Rural Electrification Fund (REF) Secretariat under
the Ministry of Energy and Mines (MEM) is working
with the United Nations Economic and Social
Commission for Asia and the Pacific (UNESCAP) to
promote rural entrepreneurship using an innovative
pro-poor public-private site-specific partnership (5Ps).
Besides developing local entrepreneurship, 5Ps aim to
integrate energy in to broader rural development
agenda and reduce stress on the government budget.
At this stage of national electrification, where most of
the unconnected population lives in villages and
scattered communities in hard-to-reach places, it is
expected that as much as 20 per cent of the total
population will remain beyond the reach of the
mainstream grid for the foreseeable future, especially
when the cost of extension has increased. 5 Indeed,
over the course of the last seven years, the average
cost per grid connection has almost doubled: from
about US$450-$550 in 2005 to about US$900 in 2012. 3
The majority of the rural population, with no access to
electricity at present, depends primarily on biomass
(fuel wood and charcoal) for domestic energy needs
such as cooking and heating. 6
Hydropower contributes almost all electricity
production in Lao PDR (figure 1). The Government has
signed memoranda of understanding (MOU) as well as
undertaken research studies on more than 70
hydropower studies. Of these, 15 are either
operational or under construction. Lao PDR has also
signed a MOU to provide 7,000 MW of electricity to
Thailand, and another MOU to provide 3,000 MW of
electricity to Viet Nam by 2020.
Electricité du Laos had a share of 50.7 per cent of the
total installed electricity capacity, the private sector
contributes 49.1 per cent and the Provincial
Departments of Energy and Mines at 0.16 per cent. 7
Solar
Diesel
Hydropower
0.05%
0.18%
0% 20% 40% 60% 80% 100%
99.76%
Figure 1 Electricity generation in Lao People’s
Democratic Republic
Source: Laos Ministry of Energy and Mines. 7
Note: Data from 2008.
Small hydropower sector overview and potential
A total of 10.5 MW small hydropower is in operation,
not including pico hydro (figure 2). Some 16.2 MW are
under construction and 23.5 MW capacity are at the
feasibility stage.
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