{"id":60149820,"date":"2026-09-04T23:36:00","date_gmt":"2026-09-04T22:36:00","guid":{"rendered":"https:\/\/dialogue.earth\/?post_type=explainer&p=60149820"},"modified":"2026-09-05T02:36:50","modified_gmt":"2026-09-05T01:36:50","slug":"explainer-how-laos-role-as-southeast-asias-battery-is-changing","status":"publish","type":"explainer","link":"https:\/\/dialogue.earth\/en\/energy\/explainer-how-laos-role-as-southeast-asias-battery-is-changing\/","title":{"rendered":"Explainer: How Laos\u2019 role as Southeast Asia\u2019s \u2018battery\u2019 is changing"},"content":{"rendered":"\n

Following a spate of foreign investment in the 1990s, Laos began producing surplus electricity and looked to export it. Today, around 80% of its energy, largely from hydropower, is sold to neighbours. Electricity exports from Laos generate around USD 2.6 billion for what is one of the poorest nations in mainland Southeast Asia. Across the region, neighbours including Thailand, Cambodia, Vietnam, Singapore and Malaysia have become reliant on hydropower from Laos.<\/p>\n\n\n\n

Slowly but surely, however, this is changing.<\/p>\n\n\n\n

Laos\u2019 hydropower exports are facing increasing competition from non-hydro renewable energy and wider changes in the region\u2019s power sector. Growing investment in non-hydro renewables and the first steps towards a regional power grid are beginning to change both the nature of that reliance and what it means for Laos to be the \u201cBattery of Southeast Asia\u201d.<\/p>\n\n\n\n

The environmental and social effects<\/a> of hydropower, particularly on biodiversity and local fisheries throughout the Greater Mekong Region, also continues to loom large on the future of hydropower in the region.<\/p>\n\n\n\n

Thailand: Buying the Battery<\/h2>\n\n\n\n

Thailand is the most prolific<\/a> importer of power from Laos, making it the main driver of the latter\u2019s power export ambitions. But Thai civil society organisations are also key opponents of large dam projects.<\/p>\n\n\n\n

The Thailand-built Xayaburi Dam in north-west Laos, which began operations in 2019 with a generating capacity of nearly 1.3 gigawatts (GW)<\/a>, was the first Mekong mainstream hydropower project in the country and remains one of its largest. The dam had been mired in controversy during its construction due to a lack of transparency<\/a> about its potential environmental and social impacts.  
<\/p>\n\n\n\n

\"group<\/div>
Thai villagers protesting against dams on the Mekong, with several placards mentioning Xayaburi. Critics have highlighted the adverse effects of the dam, one of Laos\u2019 largest projects, on the river\u2019s downstream biodiversity (Image: Apichart Weerawong \/ Associated Press \/ Alamy)<\/div><\/div><\/div><\/div>\n\n\n\n

But for local communities, the impacts are clear. Critics of the first \u201cmega-dam\u201d have cited adverse effects on downstream fisheries<\/a> and the reduction of nutrient-rich sediment<\/a> needed for the river\u2019s biodiversity. They also raise concern about hydropeaking \u2013 sudden and artificial releases of water to meet short-term peaks in electricity demand \u2013 that affects riparian animals such as beach nesting birds<\/a>.<\/p>\n\n\n\n

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Recommended<\/span><\/span><\/div><\/a>\n\n\n\n

Since Xayaburi\u2019s operations began, several hydropower dams have been planned for the Mekong. Key among them is the 1.5 GW dam near Unesco World Heritage site Luang Prabang<\/a>, set to come online in 2030. Experts fear construction of the dam could lead to revocation of the site\u2019s status.

Thailand has a dynamic environmental civil society space. The Sanakham dam project, for instance, two kilometres from the Thai border in Laos, has drawn criticism from groups<\/a> for ecological threats. Other dams such as Pak Beng<\/a> and Pak Lay<\/a>, which Thailand have significant stakes in, have faced opposition as well as allegations of contentious studies and consultations. <\/p>\n\n\n\n

Thailand is the largest investor<\/a> in Lao hydropower projects. The driving force behind these deals are Power Purchase Agreements (PPAs) promising that Thailand will buy energy from the dams once completed. For years, however, organisations such as the Mekong People\u2019s Network<\/a> and Fair Finance Thailand<\/a> have fought the construction of new dams and pushed back against PPAs. NGOs and researchers have called the dams a \u201cfalse climate solution<\/a>\u201d.
<\/p>\n\n\n\n

\"field<\/div>
A solar farm in central Thailand. The country is pushing for large solar projects and mass rooftop solar installations to shift away from liquefied natural gas and protect itself against price volatility (Image: Thattaphon Sukborwornophat \/ Alamy)<\/div><\/div><\/div><\/div>\n\n\n\n

Even with its big stakes in Lao hydropower, however, Thailand is beginning to invest heavily in solar. This is primarily to guard against rising prices<\/a> of imported liquefied natural gas (LNG), the country\u2019s primary source of energy, from external shocks like the Strait of Hormuz crisis. In September 2026, it announced a drive to install 5 GW of rooftop solar within a year for this purpose. In its draft Power Development Plan 2026, nearly half<\/a> of all its new renewable capacity between 2026-2037, totalling nearly 51 GW, is planned to come from solar.<\/p>\n\n\n\n

Vietnam: A new type of battery<\/h2>\n\n\n\n

Power needs in Vietnam are surging, driven<\/a> largely by the manufacturing sector. In March 2026, at the height of the dry season, Vietnam\u2019s electricity consumption reached 1 billion kilowatt-hours (kWh)<\/a>, months earlier than in previous years. By May, this reached 1.1 billion kWh, and authorities issued<\/a> orders to maintain stable electricity supply through measures including importing more electricity from Laos and China. In the first quarter of 2026, energy imports from Laos grew nearly 120%<\/a> compared to the same period in 2025.<\/p>\n\n\n\n

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Recommended<\/span><\/span><\/div><\/a>\n\n\n\n

In 2025, Vietnam imported roughly 1.5 GW of power from Laos, much of which was hydropower. As part of its revised PDP, released that same year, it aims to increase energy imports from Laos to at least 8 GW<\/a> by 2030, up from 5 GW in the PDP published in 2023.<\/p>\n\n\n\n

Together with Laos, Vietnam is actively increasing the interconnectivity infrastructure, contributing to the dream of connecting the grids of all countries in Southeast Asia. The latest project connecting the two countries is expected to be a 75-kilometre transmission line<\/a> linking the Nam Nha hydropower complex in Houaphanh province, north-eastern Laos, to the Vietnam border.<\/p>\n\n\n\n

While hydropower will still be a key source of Vietnam\u2019s energy imports from Laos, wind projects look set to comprise an increasingly significant share. Monsoon<\/a>, Southeast Asia\u2019s first cross-border wind project, began sending power to Vietnam in the latter half of 2025. The project, located in Laos\u2019 Sekong and Attapeu provinces, produces 600 MW, which goes to its neighbour through a high-capacity 500-kV transmission line.<\/p>\n\n\n\n

\"Wind<\/div>
Wind and solar farms in southern Vietnam. While the country has started importing wind power from Laos, it is also trying to increase its own renewable generation capacity (Image: Thinh Doan \/ Dialogue Earth)<\/div><\/div><\/div><\/div>\n\n\n\n

More Lao wind energy import projects are on the horizon. Danish renewables investment firm Copenhagen Infrastructure Partners and Vietnamese developer Fecon have proposed a 1 GW onshore wind project<\/a> in Savannakhet province in southern Laos, mainly intended to power<\/a> manufacturing hubs in Vietnam.<\/p>\n\n\n\n

Vietnam\u2019s revised PDP has increased the country\u2019s ambitions for its own non-hydro renewable generation. Compared to its 2023 targets of producing around 43 GW<\/a> from solar, wind and biomass by 2030, the revised PDP raises this figure to at least 75 GW.<\/p>\n\n\n\n

Cambodia: Future for the grid<\/h2>\n\n\n\n

Cambodia has had difficulty powering rapid urbanisation. Unplanned growth in cities like Phnom Penh and Sihanoukville has left authorities scrambling to keep pace with energy demand, which in 2025 increased by around 14% nationwide<\/a> from the year before. Energy security<\/a> has been helped by increases in solar, but the country still struggles with reliable energy, further strained by factors like the Strait of Hormuz crisis<\/a> which has led to volatile prices of imported fuel.<\/p>\n\n\n\n

Cambodia imports around 200 MW of hydropower from the Don Sahong dam in Laos, controversial for its impacts<\/a> on downstream fisheries and the endangered Irrawaddy dolphin. Cambodian civil society organisations have long pushed back<\/a> against hydropower projects in the country and region. In 2020, the country implemented a 10-year ban <\/a>on new dam projects on its mainstream Mekong, citing a need to diversify energy sources.<\/p>\n\n\n\n

\"Don<\/div>
The Don Sahong dam on the Mekong, right before it flows into Cambodia. The country imports 200 MW of hydropower from this dam, controversial for its impacts on downstream fisheries and the endangered Irrawaddy dolphin (Image: Andy Ball \/ Dialogue Earth)<\/div><\/div><\/div><\/div>\n\n\n\n

In the long run, Cambodia aims to continue importing power from Laos at a stable level, according to its Power Development Plan of 2022. This is expected to increase to around 3 GW<\/a> by 2030 and remain the same until 2040.<\/p>\n\n\n\n

But it hopes to eventually expand power sharing with Laos through one of the region\u2019s most ambitious plans: a power grid connecting the member states of the Association of Southeast Asian Nations (Asean). The initiative, which has been in the works<\/a> since 1997, is a plan to eventually share energy across all members of the bloc, in both mainland and maritime Southeast Asia. In May 2026, the Asean Centre for Energy, Electricit\u00e9 du Cambodge and Electricit\u00e9 du Laos signed<\/a> a joint study framework to advance cross-border connections, as part of a phased approach<\/a> to advancing the Asean Power Grid. The framework involves collaboration on technical assessments, economic analysis and preliminary environmental assessments for future projects.<\/p>\n\n\n\n

Laos and Cambodia took a major step towards regional grid interconnectivity in 2023 when they launched a high-capacity China-built 500-kilovolt transmission line<\/a> linking a substation in Champasak province in south-western Laos to its border with Cambodia.<\/p>\n\n\n\n

Malaysia and Singapore: End of the line?<\/h2>\n\n\n\n

Neither Malaysia nor Singapore share a border with Laos, so the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP<\/a>), launched in 2022, has been hailed as a broad advancement for the Asean Power Grid.<\/p>\n\n\n\n

From Laos, energy largely created by hydropower is sent through Thailand, which acts as a \u201cwheeler<\/a>\u201d country to send electricity through to Malaysia and subsequently Singapore. The city-state began importing 100 MW from this system in 2022, making the LTMS-PIP\u2019s first multilateral cross-border electricity trade through four Asean countries \u2013 all from Laos\u2019 hydropower dams.<\/p>\n\n\n\n

The capacity of tradable electricity was increased<\/a> to 200 MW in the project\u2019s second phase, launched in January 2026. This phase introduced multidirectional electricity trading, with Singapore importing the additional 100 MW from Malaysia.<\/p>\n\n\n\n

Imported hydropower from Laos is part of how Singapore seeks to achieve its climate goals, but experts have raised concerns<\/a> about the environmental impacts of Lao and Mekong dams, noting that it is more than just counting carbon.<\/p>\n\n\n\n

\"\"\/<\/div>
Malaysia has started exporting power to Singapore through the Laos-Thailand-Malaysia-Singapore Power Integration Project, the first multilateral and multidirectional cross-border electricity trade through four Asean countries (Image: Stephen Browne \/ Alamy)<\/div><\/div><\/div><\/div>\n\n\n\n

Nevertheless, Singapore\u2019s energy needs are helping to drive the Asean Power Grid ever further as the Sarawak to Singapore undersea connection is expected to have some engineering design studies complete by end-2026<\/a>. The hydropower produced for export will come from Malaysian Borneo, with the project estimated to transmit a proposed 1 GW of energy by around 2035.<\/p>\n\n\n\n

China: The battery\u2019s builder<\/h2>\n\n\n\n

In April, the China-Laos cross-border power transmission line began operations, opening China\u2019s domestic electricity market<\/a> to Laos\u2019 renewable energy generators. But Chinese involvement in Laos\u2019 hydropower sector stretches back two decades. Today, many of Laos\u2019 planned and completed Mekong mainstream hydropower dams have some involvement from Chinese companies, from ownership to loans and development at different levels. Major dam projects Pak Beng and Sanakham<\/a> cost at least USD 2 billion each to build and are majority-owned by Chinese companies, while others like Don Sahong and Pak Lay<\/a> have Chinese infrastructure developers. <\/p>\n\n\n\n

Chinese companies have also helped build big dam projects on Mekong tributaries, such as the Nam Ou hydropower cascade, as well as non-hydro renewable projects like the 1 GW Oudomxay Solar Farm, the largest<\/a> in Southeast Asia.
<\/p>\n\n\n\n

\"\"\/<\/div>
The Luang Prabang dam project, one of the few Lao dams with no Chinese involvement. Many of Laos\u2019 planned and completed Mekong mainstream dams have Chinese companies with part ownership or development at different levels (Image: Richard Sowersby \/ Alamy)<\/div><\/div><\/div><\/div>\n\n\n\n

China\u2019s development of Laos\u2019 domestic resources has led to some pushback. These include strategic multilateralism concerns<\/a> from the US about regional influence, and public opposition to mega-project dams due to their environmental and social impacts. Legal disputes have also arisen related to dam projects developed by China. For instance, in 2025, state-owned company PowerChina sued Electricite du Laos for USD 555 million in unpaid dues for the Nam Ou hydropower project, reported<\/a> Reuters.<\/p>\n\n\n\n

With more hydropower dams planned for the Mekong mainstream coinciding with promises to expand energy exports, non-hydro renewable energy and the potential ASEAN power grid, the Battery of Southeast Asia could look very different in the future.<\/p>\n","protected":false},"excerpt":{"rendered":"

Laos\u2019 dams and transmissions lines are powering the region\u2019s shift to lower-carbon energy. But its neighbours are also ramping up other renewables<\/p>\n","protected":false},"featured_media":60149832,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_acf_changed":false,"_has_post_settings":[],"footnotes":""},"categories":[757],"tags":[50041599,556,50042156],"country":[20028095],"class_list":["post-60149820","explainer","type-explainer","status-publish","has-post-thumbnail","hentry","category-energy","tag-energy-consumption","tag-infrastructure","tag-overseas-investment","country-laos"],"acf":[],"yoast_head":"\nExplainer: How Laos\u2019 role as Southeast Asia\u2019s \u2018battery\u2019 is changing<\/title>\n<meta name=\"description\" content=\"Laos\u2019 dams and transmissions lines are powering the region\u2019s shift to lower-carbon energy. 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