Electricity price to increase from tomorrow

HA NOI – The electricity price would increase tomorrow by 5 per cent to VND1,304 (US$0.06) excluding VAT for one kWh, Electricity of Viet Nam said in a press release.

The existing average price of VND1,242 would rise VND62 following decision 380/BCT-DTDL issued by the Ministry of Industry and Trade (MoIT) last Friday.

The increase would not apply to the first rates on the price escalation chart, which starts from 0-50kWh for the poor – who normally use less than 50kWh of electricity per month – and from 0-100kWh for other people, the press release said.

As a result, the increase would be calculated from the 101st kWh of electricity.

Poor families, who were required to register and prove they do not use not more than 50kWh of electricity a month, would still receive VND30,000 (US$1.40) as support from EVN.

Previously, EVN submitted a report to the MoIT to ask permission to increase the price on December 13.

According to EVN's report, the group suffered a loss of VND10,162 billion ($483 million) in electricity business due to low hydro-power plant production in 2010 because of insufficient water supply.

EVN had to utilise its oil-fired plants and purchase additional electricity at high prices, which caused operating costs to soar. Increased fuel prices and exchange rates contributed to rising expenses.

In a previous interview with the Viet Nam News, deputy general director of EVN Dinh Quang Tri said national electricity retail prices had subsequently remained inadequate.

"Increasing the electricity price is a urgent need for long-term development, which is in accordance with a socialist-oriented market economy as well as the formation and development of electricity market in Viet Nam," Tri said.

"It will also help solve all existing problems in the electricity price." – VNS