As of mid-October, this is the biggest contract won by China Western Power – with Xekong Thermal Power Plant in Laos. They will develop, finance, and build the dramatic new 1,800-megawatt clean development project down south in Laos. This landmark $1.45 billion deal is a major advance in advancing bilateral power exchanges between the two countries. Once complete, the project will produce three billion kilowatt hours of zero-emission electricity annually. All of this will help unlock a robust two-way electricity exchange capacity of 1.5 million kilowatts, profoundly transforming the energy landscape of this wide-distributed region.
This partnership is designed to make Laos the star of the region’s “battery of Southeast Asia.” The Southeast Asian nation has rightfully claimed this nickname for itself with its growing decarbonised electricity exports to neighbors such as Thailand and Vietnam. Even more recently, since 2016, Laos has enjoyed a quasi-monopoly on hydropower, producing 80% of its electricity from this source. The new partnership with China Western Power would help to diversify its energy portfolio. Just as importantly, it will lay the groundwork for expanding clean energy capabilities.
In 2022, China Western Power made a bold move in this direction. Last month, they signed a $409 million supply and service agreement with a Laotian state power company. Innovation took a huge leap forward this year. Of significance, a $228.8 million power transmission agreement was signed, and in February 2025 the Laos-China 500kV interconnection project will be inaugurated in Vientiane. These projects are turning points in making the electrical grid more robust and allowing for easier power trades between Laos and its new darling—China.
The $2.2 billion ambitious clean energy project is expected to be up and running by 2026. We hope to have that first prototype design finished by late 2025. Completion is currently anticipated by early 2030 — a nearly decade-long path home to the region’s transformative energy future. This tight timeline coincides with China’s broader interests in Laos. Earlier in 2023, a Chinese state-owned power company signed memorandums of understanding to increase wind and solar energy installations in northern Laos.
Electricity exports remain a crucial component of Laos' development strategy, and this new venture underscores the country's commitment to sustainable growth and energy independence. Further south, Laos is building a robust clean energy foundation. Taken together, this action will increase our export capacity and better position us to meet domestic energy needs more efficiently.