Ecology and Energy Planning in Laos

Policymakers in the Lao PDR call for the nation to become the “Battery of ASEAN,” but its current export-oriented energy development trajectory comes with high social, environmental and economic costs for this riparian country so heavily dependent on the Mekong Delta. I worked with USAID and a team of UC Berkeley colleagues to develop two capacity expansion models to explore alternative resource development strategies that contribute to a more diverse, broad-based, and efficient economy in the long run. These models inform both a strong domestic energy economy and a larger, and at the same time more sustainable, energy export sector.

The first new modeling tool is a capacity expansion and optimization package that we use to explore the trade-offs across different generation technology configurations in meeting future installed capacity goals. We explore the cost, benefits and impacts of various scenarios of large hydro, traditional fossil fuel and renewable energy based generation mixes, thereby comparing currently established expansion plans to their potential alternatives. Our second model is used to compare the technical viability of achieving rural electrification by integrating distributed off-grid, mini-grid, and centralized grid expansion.

Our results suggest that while substituting renewable energy technologies for large hydropower or coal generation may not be the least-cost option under current conditions, precise and targeted substitution results in relatively small to insignificant differences in overall lifetime costs. Moderate inclusion of technologies such as solar, wind, and biomass does not resemble the prohibitively expensive path that critics describe, especially when the substantial downstream (basin-wide) impacts of large hydropower installations are taken into consideration. Thus, strategic substitution of renewables clearly emerges as an efficient solution.

Avila, N., Kittner, N., Shirley, R., Dwyer, M., Roberts, D., Sager, J. and Kammen, D. (2019). Beyond the Battery:  Rural Electrification, Economic Diversity, and Human Development in Laos [Chapter 2] in “Sustainable Development in the Mekong Basin”. Lower Mekong Public Policy Institute, Harvard Kennedy School.