Four Policy Briefs for LAO PDR

Lao PDR’s energy system is undergoing a transformative transition, as revealed by four brand new Policy Briefs, developed by the OSeMOSYS core group of modellers in Lao PDR. Collectively they outline a complex path to sustainable energy development.

Policy Brief 1 highlights the potential of electric vehicle (EV) adoption, projecting that EV integration could increase electricity demand by approximately 2.2 times by 2055. This projection underscores the need for strategic infrastructure planning and highlights potential benefits such as reduced fossil fuel dependence and lower carbon emissions.

Policy Brief 2 delves into Laos’ seasonal energy challenges, noting that the country imports electricity during the dry season (November to April) despite significant hydropower potential. The brief presents two scenarios for energy self-sufficiency: a Business-as-Usual scenario with continued electricity imports and a No-Import scenario that reveals potential energy deficits. The analysis emphasizes the critical need for accelerated renewable energy deployment, particularly solar and wind power, to enhance energy security and reduce import reliance.

The third policy brief focuses on Laos’ strategic ambitions in electricity export. By 2050, many hydropower plants under concessionary agreements will transition to government control, presenting a significant opportunity for revenue generation. The energy systems model developed in this brief indicates reduced import dependence and increased export potential, highlighting the importance of strategic investments in transmission infrastructure and emerging industries like green hydrogen production.

Policy Brief 4 addresses the most critical challenge: balancing Laos’ current coal-fired power exports with its ambitious climate goals. With three coal-fired power plants currently in operation, the country aims to reduce greenhouse gas emissions by 60% by 2030 and achieve net-zero by 2050. The energy systems optimisation model recommends a compelling case of solar PV and wind power potentially substituting coal in meeting export commitments.

Additionally, the analysis recommends a gradual phase out of coal to avoid affecting the revenue flow from electricity imports.

Collectively, these briefs paint a nuanced picture of Laos’ energy transition. The country stands at a pivotal moment, with opportunities to transform its energy landscape through strategic investments in renewable infrastructure, EV adoption, and grid modernization. The analyses consistently emphasize the potential for solar and wind power to play a crucial role in meeting the country’s energy needs and export commitments.