Vietnam VEA Proposes Power Price Hike by 50% in 2011

The Vietnam Energy Association (VEA) has recently proposed prime minister to approve a power price increase this year by nearly 50% from currently in order to mobilize capital for the country’s electricity sector.

 

Earlier, the state-run Electricity of Vietnam Group (EVN) has urged the Ministry of Industry and Trade to consider its proposals on market price mechanism for electricity and scheme for electricity prices in 2011.

 

Last year, VEA proposed a power price hike to an average of VND1,500 per kWh of electricity from this year. 

 

The association also suggested the government to only apply price subsidy to the first 50kWh power consumption to poor, closely poor households, families with great contributions to the national liberty; households in mountainous, remote, border and island areas; the retired, pupils and students instead of to all as currently.

 

The power price table for household consumption now has seven levels with a price of VND600/kWh for first 50kWh consumption and the highest price of VND1,890/kWh for power consumption of over 400kWh.

 

The country’s power sole distributor EVN is seeking a loan of VND13 trillion to buy input materials for its gas-fuelled power plants to generate 3.8 billion kWh in the first quarter of 2011 to meet local demand.

 

The group will also buy 64.5 billion kWh of electricity from local and foreign sources to feed the domestic demand of 117.6 billion kWh in 2011, including 56.14 billion kWh in H1.

 

Vietnam has applied no more power price hike since raising retail prices by 6.8% to an average of VND1,058/kWh from March 1, 2010. (Capital Security)