The Asian Development Bank has approved $63.44 million in funds to assist Cambodia in deploying a 250MW/500MWh grid-connected energy storage project.

It is reported that the Asian Development Bank (ADB) has approved the funding support application submitted by the Cambodian government for the deployment of a 250MW/500MWh battery energy storage project. This multilateral development financial institution announced on June 24 that it has approved a total financing package of 63.44 million US dollars to support the deployment of a battery energy storage system at the Takeo substation in southern Cambodia.

The solar power plant and battery energy storage system in the National Solar Park of Phnom Penh Phchey Nyunt Province

This financing plan includes a $40 million concessional loan, a $5 million grant from the Asian Development Fund, and a joint financing of $18.44 million provided by the Global Green Climate Fund (GCF) and the UK government through the ASEAN Green Finance Catalyst Mechanism (ACGF).

According to data released by Bloomberg New Energy Finance, the average cost of a 2-hour continuous battery energy storage system globally in 2025 was $124/kWh. Based on this estimation, the funds provided by the Asian Development Bank can cover most of the costs of this project – although there are differences in capital expenditure requirements across regions.

The ASEAN Green Finance Mechanism (ACGF) is an initiative launched by the ASEAN Infrastructure Fund in 2019, aiming to accelerate green infrastructure investment in ASEAN countries.

The Asian Development Bank (ADB) and the Cambodian state-owned utility company EDC jointly released a tender announcement on June 22, soliciting proposals for project design and construction. This project will be equipped with grid-forming (GFM) inverter functions, mainly to assist industrial zones, agricultural processing facilities, and urban areas in absorbing the grid-connected power of fluctuating renewable energy (VRE), while promoting cross-border power transactions with Vietnam in response to the ASEAN Grid Initiative. Additionally, the grid-forming technology will enable the energy storage system to participate in frequency control and grid stability services – services that traditionally were provided by fossil fuel or hydroelectric power plants.

In March this year, Cambodia’s first grid-connected battery energy storage project was put into operation. The project is located in Phnom Penh Province in the west and has a capacity of 500MW/1000MWh. It is deployed in the same site as a large-scale solar power generation facility.

The bidding window for the energy storage project will remain open until August 20th.

This public competitive bidding will be conducted in accordance with the Asian Development Bank’s “one-stage: one-envelope” procedure – the technical proposal and the price proposal must be combined and placed in one envelope for public opening. The bid submission deadline is 10:00 a.m. on August 20, 2026. The winning project must be completed within 12 months from the effective date of the contract.

The requirements for bidding eligibility include:

• Over the past three years (counting from the submission of the tender documents), as a contractor, a partner of a joint venture, a supplier or a subcontractor, one has undertaken contracts that accounted for at least 75% of the total value of the previous BESS contract.
• Or within the past five years, as the main contractor, a member of a joint venture, or a supplier, you have completed or implemented grid-connected or micro-grid battery energy storage projects with a capacity of 2GWh or more;
• Or within the past five years, as a contractor, a consortium member, a supplier or a subcontractor, successfully completed two or more battery energy storage projects (each contract with a scale of no less than 100 MWh and featuring frequency control functionality), and the projects have been operating stably for at least one year, with a cumulative contract amount exceeding 13 million US dollars.

In addition, the financial threshold requirements are as follows: the average annual business turnover over the past five years must be at least 83 million US dollars, and the current financial obligation capacity for contract performance must be at least 13.7 million US dollars.

The Asian Development Bank stated that this project will help reduce Cambodia’s energy sector’s reliance on high-cost and high-pollution imported fossil fuels and promote the application of renewable energy electricity. According to Cambodia’s 2022-2040 Power Development Master Plan, the country aims to achieve 70% renewable energy generation by 2030. Thanks to its abundant hydropower resources, 63% of Cambodia’s current power generation structure already comes from renewable energy.

According to local media reports, Cambodia’s Minister of Mines and Energy, Keo Rottanak, stated in March this year that the country is steadily achieving this goal – which is already far exceeding the overall target of 35% for ASEAN countries by 2030. However, the imported fossil fuels in Cambodia still face the risk of price fluctuations.

Yasmin Siddiqi, the Country Director of the Asian Development Bank in Cambodia, said: “In the context of the global energy crisis, this project further solidifies Cambodia’s commitment to the transition to clean energy. By strengthening the grid operation through battery energy storage systems, we are helping the country unlock more potential for renewable energy generation, while ensuring that households, farmers, and businesses have access to safe, stable, and affordable electricity.”

The “Preliminary Environmental Assessment” released in December 2025 and the “Social Security Due Diligence Report” published in January 2026 provided more details about this project.