The Cambodian Ministry of Mines and Energy has reaffirmed its pledge to maintain subsidized electricity tariffs for households, agriculture, and tourism sectors, prioritizing economic stability despite escalating global energy costs.

The announcement, made by Minister H.E. Keo Rottanak during the annual review meeting of the Electricity Authority of Cambodia (EAC) on February 3, underscores the government’s strategy to shield consumers and industries from volatile energy markets.
Key Announcements and Context
Tariff Stabilization Efforts:
Minister Rottanak emphasized that the Royal Government of Cambodia (RGC) will absorb rising costs of fuel, coal, and imported electricity to avoid passing financial burdens onto consumers.
“Even as global prices surge, we will not raise electricity prices. This is critical to sustaining livelihoods and economic growth during challenging times,” he stated.
Sector-Specific Support:
Households: Subsidies ensure affordable access to electricity, particularly for low-income families.
Agriculture: Reduced tariffs support irrigation and farming operations, a cornerstone of Cambodia’s rural economy.
Tourism: The sector, still recovering from pandemic losses, benefits from lower operational costs for hotels and resorts.
Industrial Relief: In September 2023, the ministry reduced electricity prices for industrial and agricultural consumers, a move credited with enhancing factory competitiveness by lowering production costs. This aligns with Cambodia’s goal to attract manufacturing investment and boost exports.
Energy infrastructure and renewable growth
Cambodia’s total installed electricity capacity reached 5,044 megawatts (MW) in 2023, marking an 8.5% increase from 4,649 MW in 2022. The energy mix includes:
Hydropower: The backbone of renewable energy, contributing roughly 60% of domestic production.
Solar and Biomass: Expanding solar farms and biomass projects (e.g., rice husk-powered plants) now account for 10% of capacity.
Imports: During dry seasons, Cambodia purchases electricity from Laos, Thailand, and Vietnam to offset hydropower shortages.
Challenges and Strategic Priorities
Cost Pressures: Global coal prices rose 20% in 2023, while imported electricity costs spiked due to regional demand. The RGC’s subsidy program requires significant fiscal discipline, funded through state reserves and bilateral energy agreements.
Renewable Transition: Critics urge faster adoption of solar and wind energy to reduce reliance on coal and imports. The ministry aims to increase renewable capacity to 25% by 2030, supported by international partnerships.
Grid Modernization: Plans to upgrade transmission infrastructure aim to reduce energy losses and improve rural access, currently at 98.5% nationwide.
Economic and social implications
The subsidy policy is a lifeline for Cambodia’s post-pandemic recovery:
Agriculture: Lower energy costs aid rice production and agro-processing, vital for food security and export revenue.
Tourism: Stable tariffs help resorts and SMEs rebound.
Manufacturing: Garment and electronics factories, which employ over 1 million workers, rely on affordable power to maintain competitive pricing in global markets.
Expert Insight:
Dr. Vannarith Chheang, an energy economist at the Asian Vision Institute, noted:
“Subsidies are a short-term fix. Sustainable growth requires modernizing Cambodia’s energy grid and accelerating renewables to insulate the economy from global shocks.”
Looking ahead
Minister Rottanak reiterated plans to balance subsidy commitments with long-term energy security. This includes diversifying energy sources, expanding cross-border electricity trade, and incentivizing private investment in renewables. The ministry is also drafting a 2024–2028 energy strategy to align with Cambodia’s carbon neutrality goals by 2050.
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