(KPL) The Asian Development Bank (ADB) has approved a US$3.25 million technical assistance (TA) project to enhance power sector reform in the Lao People’s Democratic Republic (Lao PDR). The TA aims to improve governance and policy reform to create sustainable and reliable clean electricity supply in the Greater Mekong Subregion (GMS). It will also help pave the way for increased investment and private sector participation in renewable energy.

“The Lao PDR has significant potential to scale renewable energy to generate revenue and mitigate climate change impacts, but it needs to promote private sector investment through sound macroeconomic management and structural reforms,” said Sonomi Tanaka, ADB Country Director for the Lao PDR “These are needed to build the country’s creditworthiness and accelerate its sustainable public financial management”.

The government aims for the country to become a ‘green energy hub’ in the GMS.

However, the country’s energy sector is challenged by reform gaps and financial issues, hindering investments in transmission and distribution infrastructure, as well as the country’s ability to meet regional energy transition goals.

The TA under the Power Sector Enhancement for Fiscal Sustainability Project will assist the Government of the Lao PDR to (i) modernize power sector regulations, tariff reforms, and governance arrangements; (ii) improve market access for private sector participation in expanding clean energy generation; (iii) enhance power utilities' environmental and social safeguard management system; and (iv) strengthen human resource capacity development for implementing power sector reforms.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.

KPL