Laos has entered a $1.45bn clean energy agreement with China Western Power Industrial, advancing the country’s clean power generation and transmission efforts.

China Western Power signed the agreement with Xekong Thermal Power Plant in Laos to design, supply, and build a 1,800-megawatt clean energy power project in southern Laos in collaboration with a Singapore-based construction company, as reported by Reuters.

The project is set for completion by early 2030, with initial designs expected by the end of 2025.

Details on the project’s energy source have not been disclosed.

China Western Power has signed a $228.8m power transmission agreement with the same Laotian company.

This follows a $409m supply and service deal with another Laotian power company in 2022.

In a related development in 2023, a Chinese state-owned power company also signed an agreement to expand a wind and solar energy base in northern Laos.

Laos, known for its mountainous terrain, has generated 80% of its electricity from hydropower since 2016.

However, the country has faced challenges in scaling up solar and wind power.

Electricity exports, particularly to Thailand and Vietnam, are a crucial part of Laos’ development strategy, earning it the moniker “the battery of Southeast Asia.”

In February 2025, the Laos-China 500kV interconnection project was officially launched in Vientiane, the capital of Laos.

This initiative aims to expand bilateral power exchanges, strengthening co-operation between Laos and China.

The project, expected to be operational by 2026, will enable a two-way electricity exchange capacity of 1.5 million kW, delivering three billion kilowatt hours of clean electricity annually.