Energy-starved Cambodia has opened its largest hydro-electric dam to date, a multi-million dollar China-funded project that has drawn praise from the Phnom Penh government and criticism from environmentalists.

Prime Minister Hun Sen and a host of dignitaries witnessed the start of operations Wednesday at the 194-megawatt dam on the Kamchay river in southern Kampot province. The prime minister called the inauguration a “historic event” that will help reduce the cost of electricity in his country, where only about 15 percent of households have access to electrical power.

The $280 million project has pitted Cambodian and foreign-based environmentalists against government planners. Opponents say locals have been denied a voice in the Kamchay project and several others under construction.

The U.S.-based International Rivers organization also says the dam has destroyed hundreds of hectares of forest and farmlands, and says it will have a negative impact on fisheries in the impoverished country.

Proponents have argued that unreliable and increasingly expensive electrical utilities have severely hampered foreign investment in Cambodia, despite government efforts to reduce energy costs.