Lao PDR is a mountainous country with a population of about 5.6 million, over 80% of which lives in rural areas and is engaged in rice-based agriculture and harvesting of forest products. The narrowly based economy is one of the least developed in Asia with an approximate per capita Gross National Product of around US$ 500 per annum ( 2006 )

The Main Economic in Laos is from the Agriculture, Forestry, Power Generation, Mining, Small industries and agriculture is 42.2 % of the Gross Domestic Product, while the Industry is 31.5 % , Services 25.4 % and Import duties 0.9 % ( in 2006 ) .

Lao PDR is endowed with significant indigenous energy resources for electricity generation. Hydropower is the most abundant and cost-effective form. The energy resources range from traditional energy source such as fuel-wood to coal and hydropower. The forest areas which cover about 40 % of total land are a potential source for substantial traditional energy supplies.

The Lao power sector is in the good progress stage as 54.1 % of the population having access to electricity in 2006 . but the main energy consumption in Laos comes from fuelwood for cooking.

In order to meet the government target for the increasing the households electrification ration to be 70 % of total households in 2010 and 90% in 2020 , the Government set up the Power Sector Policy :

1. Maintain and expand an affordable, reliable and sustainable electricity supply in Lao PDR to promote economic and social development;

2. Promote power generation for export to provide revenues to meet GOL development objectives;

3. Develop and enhance legal and regulatory framework to effectively direct and facilitate power development; and

4. Strengthen institutions and institutional structures to clarify responsibilities, strengthen commercial functions and streamline administration

In order to meet those targets and Policies, now a day there are more than 50 MOU for the hydropower development with the capacity from 5 — 1080 MW and 6 projects are under construction, if we look on those hydropower development plan, we could see that there are many waste wood in the reservoirs need to be clear and if we have the good technologies and investment capital then we could construct biomass cogeneration projects in Laos.

Lao PDR import 100 % fossil fuels, at the present there are 3 companies to conduct the survey for the natural gas and oil and it takes about 10 years for getting all information and for the production of natural gas and oil ( if feasible ) , for reduction of import fuel and high efficiency fossil fuel consumption, the government of Laos also support the biofuel as biodiesel from the Jatropha and palm oil and bioethanol from the sugarcane.

After the government announced for promotion of biofuel, the are some companies started the business by plantation of Jatropha to produce the bio diesel, the biggest investor is Kolao Farm company, their target is plant the Jatropha 40.000 hac , the factory is under construction, it is far from the Vientiane Municipality about 70 km.

The second company is LaoBiodiesel company just started the construction of the factory in Champasak province on 10 March 2008 and their plantation is 100 hac for the Jatropha.

There are two companies to invest on the palm oil, the first one in Champsak province with the plantation of 25 hac, this company started in 2006 and the second one in Bolikhamsay province with the plantation of 20 hac this company started in 2006 .

The other companies to invest on Jatropha for biodiesel are small plantation.

Under Lao — Thai cooperation of Energy sector, the Ministry of Energy of Thailand give one set of Biodiesel production equipment from Jatropha to Ministry of Energy and Mines for the demonstration.

The Promotion of biodiesel is much more popular than biothethanol because the investment cost and the technology of bioethanol is high and now there is only one small existing of sugar factory in Laos, there other two factories are under construction in Savannaketh province.

Because of there is no any document for the promotion of biofuel in Laos, the department of Electricity, Ministry of Energy and Mines requested New Energy and Industrial Technology Development Organization ( NEDO ) , Representative Office in Bangkok to support the finance to hire the Lao Institute of Renewable Energy in Laos ( LIRE ) to conduct the survey and drafted the recommendation for the Strategy and Policy for the Promotion of Biodiesel in Laos.

The target of the government to reduce the fossil fuel consumption 5 % by promotion of biodiesel production.

The details of Strategy and Policy will be developed more..