(KPL) The Lao government has signed a memorandum of understanding aimed at promoting the nationwide use of electric vehicles, as officials work to reduce the impact of rising global fuel prices and strengthen the country’s transition to clean energy.

The agreement follows Prime Minister’s Order No. 40, issued on March 13, 2026, which calls for urgent measures to address fuel shortages and price volatility that have affected the national economy and household expenses.

State-owned power utility Electricité du Laos, known as EDL, is leading the initiative in coordination with 27 public and private sector partners. These include transport companies, electric vehicle suppliers, infrastructure developers and financial institutions such as Banque pour le Commerce Extérieur Lao.

Officials say the project focuses on expanding the use of electric trucks to reduce fuel consumption and take advantage of Laos’ domestic electricity supply. The plan is also intended to cut reliance on fuel imports and improve long-term economic resilience.

However, authorities acknowledge significant challenges. Electric trucks currently have a limited range of about 100 to 150 kilometers per charge, compared with 500 to 600 kilometers for conventional fuel-powered vehicles. The country also lacks dedicated charging stations and battery-swapping infrastructure for heavy transport. In addition, the upfront cost of electric trucks remains more than double that of traditional vehicles, making adoption difficult for many transport operators.

Under the agreement, partners will collaborate across four key areas: vehicle supply, charging infrastructure, transport operations and financing. The group plans to build charging and battery-swapping stations, develop a centralized digital platform to manage energy use and charging schedules, and introduce financial products to support businesses transitioning to electric fleets.

Speaking at the ceremony, Akhomdeth Vongxay said the partnership will play a key role in advancing the country’s use of electric transport. He added that continued government support and clear policy direction will be essential to encourage broader participation from the private sector.

Minister of Industry and Commerce Malaithong Kommasith said the initiative is expected to reduce carbon emissions, lower fuel import costs and improve the efficiency of the transport sector through the use of digital technology. He also noted that the project could help Laos align with regional trends in sustainable development.

Senior officials attending the signing ceremony included Deputy Prime Minister Saleumxay Kommasith and Central Bank Governor Bounkham Vorachit, along with other government leaders and business representatives.

The agreement marks a significant step in Laos’ efforts to modernize its energy and transport systems, although its success will depend on overcoming infrastructure gaps and improving access to financing for electric vehicle adoption.

KPL