The Japan International Cooperation Agency (JICA) and the Lao government agreed last Friday to continue discussions regarding the construction of a 115kv transmission line and substations in Savannakhet and Saravan provinces.
JICA reported that they had previously supported the construction of 115kv transmission lines and substations to deliver power to a 300km section between Pakxan district in Borikhamxay province and Pakbo village in Kaysone Phomvihane district, Savannakhet province, which was installed earlier this year.
The new transmission line is expected to ease power shortages in Savannakhet and Khammuan provinces (South 1), improve reliability, ease brownouts, and enhance rural electrification.
The situation in the Lao energy sector has changed drastically in recent years, both on the demand and supply side, and the importance of the power sector to the Lao economy cannot be overemphasised.
Not only does it acquire foreign currency reserves through exporting electricity to neighbouring countries, it also contributes to domestic development, and enhances integration in the Greater Mekong Sub-region.
Due to significant economic growth, domestic power consumption has been increasing rapidly. The South 1 area in particular needs an extra power boost, as this is where the East-West Economic Corridor is situated and the Savan-Seno Special Economic Zone is under development. Local mining ventures also require a reliable power supply.
On the supply side, power development projects have been undertaken mainly in the northern and central provinces and in Saravan, Xekong, Champassak and Attapeu provinces (South 2) in the south to meet both domestic power demands and export power to neighbouring countries.
The national power network system is divided into four separate regions, but the transmission systems in South 1 and one in South 2 are not yet interconnected.
In South 2, there are a number of electricity development projects for domestic supply planned by Independence Power Producers and South 2 has enormous potential to supply its surplus power to South 1. To meet the future demand in South 1, it is essential to establish an electricity network that links South 1 and South 2 (Savannakhet and Saravan provinces).
JICA attaches great importance to the role of the power sector in terms of development. Since launching a study in the late 1950s, Japan has been providing assistance for various infrastructure projects such as the Nam Ngum 1 hydropower project in 1974, and the Nam Leuk hydropower project in 1996.
JICA and the Lao government have agreed to continuous cooperation to develop the energy sector in Laos.
