EVN Hanoi workers install an eletrcity meter in Thuong Tin District, Hanoi (Photo: VNA)Hanoi (VNA) — Deputy Prime Minister VuongDinh Hue has asked the Ministry of Industry and Trade (MoIT) to calculateretail power price adjustments every six months instead of three as itproposed.
In a draft revision of a Government decision on power price adjustment, theMoIT proposed an adjustment period of every three months instead of the sixmonths implemented since 2013. However, after discussions with involvedparties, the Deputy PM asked to maintain the current adjustment mechanism toensure macro-economic stability.
The Deputy PM asked the MoIT to team up with the Ministry of Finance and VietnamElectricity Corporation (EVN) to review and finish the draft on averageelectricity retail prices and submit it to the Prime Minister next month.
Earlier, the Deputy PM asked the MoIT and EVN to draft a report, includingproduction and business activities, expenses, production costs and sellingprice in 2016, as well as a plan for 2017.
In a draft revision of a Government decision on power price adjustment, theMoIT proposed an adjustment period of every three months instead of the sixmonths implemented since 2013. However, after discussions with involvedparties, the Deputy PM asked to maintain the current adjustment mechanism toensure macro-economic stability.
The Deputy PM asked the MoIT to team up with the Ministry of Finance and VietnamElectricity Corporation (EVN) to review and finish the draft on averageelectricity retail prices and submit it to the Prime Minister next month.
Earlier, the Deputy PM asked the MoIT and EVN to draft a report, includingproduction and business activities, expenses, production costs and sellingprice in 2016, as well as a plan for 2017.
But a power rate hike for consumers appears likely in the coming months, giventhat there was no adjustment in 2016 and the last power tariff hike was inMarch 2015, when it increased 7.5 percent.
An EVN representative told media that the power retail price would depend onthe price of coal the company buys. The Government has asked the FinanceMinistry to negotiate with the Vietnam National Coal and Mineral IndustriesGroup (Vinacomin) over the coal prices sold for electricity production. Thenegotiation results must be submitted to the Government by the end of thismonth.
Dang Hoang An, EVN’s general director, said the input cost for electricityproduction had increased since 2015, with coal prices up 7 percent sinceDecember 24, 2016, and electricity production costs surging by over 4.7trillion VND (206 million USD).
However, the increase had not been included in the current power retailtariffs.
Nguyen Ngoc Hung from the Energy Institute told news site Vietnamnet.vn thatthe electricity demand and material prices could affect power tariffs thisyear. Hung said the higher power retail prices were due to increasing demand,which rises 11-12 percent a year. In addition, the country had seen developmentof thermo-hydropower and gas turbine power plants instead of hydropower plants– the cheapest electricity resource.
"That is the reason a rate hike is unavoidable," he said.
Coal prices have a major effect on power tariffs as thermo-power plants accountfor the biggest chunk of the country’s supply.
EVN said its power output bought from power plants in the last quarter of 2016included 26 percent of hydropower, 40 percent of thermo-power and 31 percent ofgas turbine power and other.
Hung said it was estimated that if coal prices for electricity production roseby 10 percent, the power generation cost would increase by 3-4 percent.-VNA
An EVN representative told media that the power retail price would depend onthe price of coal the company buys. The Government has asked the FinanceMinistry to negotiate with the Vietnam National Coal and Mineral IndustriesGroup (Vinacomin) over the coal prices sold for electricity production. Thenegotiation results must be submitted to the Government by the end of thismonth.
Dang Hoang An, EVN’s general director, said the input cost for electricityproduction had increased since 2015, with coal prices up 7 percent sinceDecember 24, 2016, and electricity production costs surging by over 4.7trillion VND (206 million USD).
However, the increase had not been included in the current power retailtariffs.
Nguyen Ngoc Hung from the Energy Institute told news site Vietnamnet.vn thatthe electricity demand and material prices could affect power tariffs thisyear. Hung said the higher power retail prices were due to increasing demand,which rises 11-12 percent a year. In addition, the country had seen developmentof thermo-hydropower and gas turbine power plants instead of hydropower plants– the cheapest electricity resource.
"That is the reason a rate hike is unavoidable," he said.
Coal prices have a major effect on power tariffs as thermo-power plants accountfor the biggest chunk of the country’s supply.
EVN said its power output bought from power plants in the last quarter of 2016included 26 percent of hydropower, 40 percent of thermo-power and 31 percent ofgas turbine power and other.
Hung said it was estimated that if coal prices for electricity production roseby 10 percent, the power generation cost would increase by 3-4 percent.-VNA
VNA
