Price of electricity

I was always told that electricity in Cambodia is very expensive and that's why no industry can flourish here. I tried more than once to compare prices with France and could not get a clear view because of pricing options and exchange rates.

If I convert French prices to USD they seem high because the euro is so strong now. The prices in France are not indexed on the price of oil though because 80% of the electricity is produced by nuclear plants and most of the rest is hydro-electricity.

Let's try anyway with prices in USD, exchange rates of 1.25 USD/Euro and 4050 Riels/USD.

In France, the price paid for electricity by individuals is between 8 and 13 cents/kWh with taxes (including 19.6% VAT). A small business pays between 6 and 10 cents/kWh. I guess large clients get lower prices.

In Phnom Penh, I pay my owners about 18 cents/kWh but most of my friends pay between 20 and 25 cents/kWh (the price I pay was the cost price for my owners at the time we signed the renting contract and I bet the price has increased since but my owners didn't bother reflecting the price increase because I consume only about 2 $ worth of electricity each month).

=> The difference doesn't strike at first when comparing the price I pay here (18 cents) to the highest price in France (13 cents).

In Stung Treng, on the Mekong in the North of Cambodia (about 50 kms from the border with Laos), they just got an electricity service three months ago.

A guest house owner told me that, before that, he used to pay 1 $/kWh for electricity generated by a neighbouring hotel. Now the price paid to the company is about 31 cents/kWh. The service is very unreliable, though.

In Banlung the price is lower: I heard a price of 15 cents/kWh but didn't get a full answer as to why. I guess electricity comes from Vietnam or Laos which are nearby.

=> Compared to the average income per inhabitant, electricity is obviously a very very expensive good in Cambodia, especially where the is no distribution service and one needs to own a generator or buy from someone who has one: think of someone living on 1 or 2 $ per day and a 1 $ price tag on the kWh... But I'm not enough of an economist to see how the price of electricity in the Phnom Penh area could by itself prevent industry to develop.