Laos' Hydroelectric Capacity to Serve as Powerhouse for Southeast Asia

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Researched by Industrial Info Resources (Sugar Land, Texas)--The nation of Laos is land-locked, but mountainous, providing reliable water movement derived from the Mekong River. The majority of Laos' electricity is generated via hydroelectric power, taking advantage of the country's terrain and resources. Currently, Laos has an installed hydroelectric power capacity of approximately 2,500 megawatts (MW), a 27% jump since 2007, with a potential generation capacity of more than 26 gigawatts.

Southeast Asia's power demand growth is expected to reach at least 5% per year over the next decade as the region experiences significant urbanization and industrialization. Unlike its neighbors, however, Laos' capacity growth is expected to exceed domestic demand growth by approximately 5.5% every year through 2030. This gives Laos' the opportunity to provide electricity to neighboring countries, such as Vietnam, Thailand and Malaysia. Vietnam is expecting large investments in the power industry as well, though most developments will take place in the coal-fired sector.

Industrial Info is currently tracking more than $10 billion worth of hydroelectric power development in Laos, falling just behind Vietnam and the Philippines. Laos accounts for approximately 18% of the region's hydroelectric development, while Vietnam and the Philippines account for 20% each. Roughly 54% of the hydroelectric power projects tracked in Laos are larger than 100 MW, with about $1.5 billion worth currently under construction. Another $8.9 billion worth are scheduled to start within the next few years.

Firms from Vietnam, as well as firms from Malaysia and Thailand, are heading most of the projects under development in Laos. Two of the largest, both more than 1 gigawatt each, are being planned by PetroVietnam Corporation (Hanoi, Vietnam). One, with a designed capacity of 1,410 MW, is currently under construction on the Mekong River in Louangphabang, while the other will not see development for another few years. PetroVietnam is also involved in the construction of two other power stations Vietnam, both scheduled for completion later this year.

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