Lao PDR Learns about Small Hydropower from Vietnam




In Lao PDR, small hydropower has the potential to be big business. With support from IFC and the Australian government, Lao PDR approved the Regulation on Small Hydropower Development this month to streamline approvals for projects less than 15 megawatts, in accordance with the Electricity Law.


This regulation was prepared in collaboration with the Hydropower Developers’ Working Group (HDWG), a private sector platform aimed at contributing to policy change. Members of the HDWG reviewed the drafts, liaised with senior Lao PDR government officials and participated in consultative discussions.


“Small hydropower is extremely important for my province, but the planning process should be improved,” said Phetsavanh Philavong, Deputy Director of Section Policy and Business Energy, Department of Energy and Mines of Attapeu. “Learning from Vietnam’s experiences will definitely help us build ours better.”


About 300 small hydropower projects are in the preparatory or negotiation phase in Lao PDR, while 11 are under construction and 13 in operation.


Philavong was one of 25 top-level representatives at the five-day study tour in Vietnam, led by the Lao Ministry of Energy and Mines and supported by the World Bank Group.


The event allowed Lao government officials and hydropower professionals to learn from their neighbor’s small hydropower development experiences. Participants applied the shared lessons to the final draft of the regulation.


“What we learned was that for the regulation to work, there needs to be transparency,” said Philavong. “In Vietnam we learned practical procedures and how the regulation on small hydropower can help us develop in a more sustainable way.”


In Attapeu, Philavong’s home province in southern-most Lao PDR, small hydropower has the potential to contribute to socio-economic development by boosting business investments and bringing affordable electricity to rural residents. Today, fifteen projects are in the pipeline in Attapeu and local companies are approaching authorities to develop more.


Study tour participants visited three small hydropower projects including Song Rieng, Coc San and Hoa Phu and met with local authorities and hydropower developers. Lao officials learned how Vietnam addressed the roles and responsibilities of government agencies’ at different procedural levels to ensure regulatory bodies are maintaining high construction standards.


“The Small Hydropower Regulation aims to help local authorities with their decision-making when prioritizing projects,” said Amphavanh Sisouvanh, IFC Associate Operations Officer, based in Vientiane. “About 50 hydropower projects that did not meet standards have been cancelled in Vietnam. IFC supports the government of Lao PDR’s implementation of stronger regulations and promotes high quality hydropower investments in Lao PDR."