en.Wedoany.com Reported - The Asian Development Bank (ADB) has approved $63.44 million in financing to support the deployment of a 250MW/500MWh battery energy storage project at the Takeo substation in southern Cambodia. The multilateral development financial institution announced the financing package on June 24.
The financing package consists of a $40 million concessional loan, a $5 million grant from the Asian Development Fund, and $18.44 million in co-financing jointly provided by the Green Climate Fund (GCF) and the UK government through the ASEAN Catalytic Green Finance Facility (ACGF). The ACGF is an initiative launched by the ASEAN Infrastructure Fund in 2019 to accelerate green infrastructure investment in the region.
According to data from BloombergNEF, the global average cost of a turnkey battery energy storage system with a two-hour duration in 2025 is $124/kWh. Based on this estimate, the financing could cover most of the project costs, although capital expenditure requirements vary by region.
On June 22, the ADB and Cambodia's state-owned power utility, Electricité du Cambodge (EDC), issued a tender notice soliciting proposals for project design and construction. The project will be equipped with grid-forming (GFM) inverters, primarily serving industrial zones, agro-processing facilities, and urban areas. It will help integrate variable renewable energy (VRE) into the grid, while facilitating cross-border electricity trading with Vietnam in response to the ASEAN Power Grid initiative. Grid-forming technology also enables the energy storage system to participate in frequency control and grid stabilization services, functions traditionally provided by fossil fuel or hydropower plants.
Cambodia's first grid-forming battery energy storage project, with a capacity of 500MW/1000MWh, was commissioned in March this year in the western province of Pursat, co-located with a large-scale solar power facility.
This tender follows the ADB's "Single-Stage: Single Envelope" procedure, where bid documents must combine technical and price proposals in a single sealed envelope for public opening. The bid submission deadline is August 20, 2026, at 10:00 a.m., and the winning project must be completed within 12 months of contract effectiveness. Eligibility requirements include: having undertaken, as a contractor, joint venture partner, supplier, or subcontractor, contracts totaling at least 75% of the value of a previous BESS contract within the past three years; or having completed or implemented, as a prime contractor, joint venture member, or supplier, grid-connected or microgrid battery energy storage projects exceeding 2GWh within the past five years; or having successfully completed, as a contractor, consortium member, supplier, or subcontractor, two or more battery energy storage projects, each with a contract size of no less than 100MWh and frequency control functionality, with stable operation for at least one year, and cumulative contract value exceeding $13 million. The financial threshold requires an average annual turnover of at least $83 million over the past five years and a current financial capacity to fulfill contractual obligations of at least $13.7 million.
The ADB stated that the project will reduce the Cambodian energy sector's reliance on costly and polluting imported fossil fuels, promoting the adoption of renewable energy. According to Cambodia's Power Development Master Plan 2022-2040, the country aims to achieve 70% renewable energy generation by 2030. Leveraging its abundant hydropower resources, Cambodia's current power generation mix already includes 63% from renewables. Local media reported that Cambodian Minister of Mines and Energy Keo Rottanak said in March that the country is steadily progressing toward this target, which far exceeds the ASEAN-wide goal of 35% by 2030, though imported fossil fuels remain exposed to price volatility risks.
Yasmin Siddiqi, ADB Country Director for Cambodia, stated that against the backdrop of the global energy crisis, this project further strengthens Cambodia's commitment to the clean energy transition. Strengthening grid operations through battery energy storage systems will help unlock more renewable energy generation potential while ensuring safe, stable, and affordable electricity for households, farmers, and businesses.
Further details of the project were disclosed in the "Initial Environmental Assessment" published in December 2025 and the "Social Safeguards Due Diligence Report" published in January 2026.
