Hong Lai Huat (HLH) Agriculture Company and China Machinery Engineering Corporation (CMEC) have signed a non-binding memorandum of understanding (MOU) for a solar farm project in Cambodia. The legal agreement specifying the partnership’s specifics is scheduled to be signed in the next 90 days. The duration of the proposed partnership is 20 years including a right of renewal for another 20 years. The project’s total investment value is estimated to be USD200 million.
The two companies will create a special purpose vehicle (SPV) to build and operate a 200 MW solar farm at Aoral Eco-City, Hong Lai Huat’s Cambodian development project. The planned solar farm will supply electricity to the EDC grid under a Power Purchase Agreement (PPA) between the SPV and the state-owned Electricite du Cambodge (EDC). The companies will share the profit generated under the PPA. The HLH group will also be able to purchase power from the solar farm at the same price that it provides to EDC.
The planned solar farm project is an important part of the eco-city as it will provide renewable energy to the local community while also reducing carbon emissions and increasing energy protection for investors in the Aoral Eco-City.