PM Calls for Acceleration of Power Plant Construction

PM Calls for Acceleration of Power Plant Construction

Prime Minister Phan Van Khai has urged the local electricity industry to ensure work on new power plants proceeds as quickly as possible in a recent meeting that reviewed the progress of power construction.

This move was prompted by the power blackouts that hit the north of the country during May, which have been blamed on an unprecedented high demand and a shortage of water to operate the Hoa Binh Hydropower Plant.

Khai has required the ministries of industry, construction, and planning and investment and the government office to regularly inspect hydropower plants and report progress and difficulties directly to the prime minister.

He has asked the Ministry of Industry (MoI) to increase the speed of construction of power projects so that power demand for 2006-2007 can be met.

The government has also instructed the State Bank to consider permitting commercial banks to lend more than 15 per cent of the legal capital required to finish power projects.

The government said six power projects should be operational next year, including the Se San 3, Se San 3A, Srok Phumieng and Tuyen Quang hydropower plants, with a combined capacity of 761 MW. Two other thermal power plants, Uong Bi and Ca Mau, are expected to start producing electricity in the next few years.

According to a MoI report, 15 power plants are due to start construction this year, with seven bankrolled by the State-owned Electricity of Vietnam (EVN), and the others built by joint stock companies. These new projects will provide a total designed capacity of 3071 MW, supplementing the 16 other plants currently under construction, which will produce 3066 MW.

According to EVN, Vietnam now lacks VND45 trillion ( US$2.85 billion) for 14 projects that are under construction and to be kicked off within this year.

EVN General Director Dao Van Hung said at the meeting that the implementation of development plans for power projects has been tardy and faced many difficulties. In particular Hung was concerned over slow approval of investment projects, less synchronous equipment supply, and difficulties in capital mobilization.

Vietnam’s economic growth of more than 7 per cent over the last few years has pushed the country’s demand for electricity up by 14-15 per cent annually on average. The demand should reach 93 billion kWh by 2010, or double the current figure. As a result the country needs to build another 52 power plants in the next five years with a designed capacity of 7,547 MW at a total cost of  US$13.7 billion.

In a meeting early last month, the government said it would consider additional investment to build coal-fired plants in the central and southern regions, and mobilize capital from non-state and foreign sources through build-operate-transfer and build-transfer modes.

Vietnam would import about 2,000 MW of electricity from Laos, according to an electricity development plan until 2010, which was approved last October. The country is currently purchasing power from China through three transmission lines in Lao Cai, Quang Ninh, and Ha Giang.

EVN supplied 21.5 billion kWh of electricity in the first half of this year, up 14.78 per cent over the same period last year, but only representing by 48.44 per cent of the plan set by the government. Electricity for industries and construction accounted for 45.54 per cent of the total commercial power.

• People’s Army, VIR