Government approves power price hike of 15.28%

Thứ năm, 3/3/2011 | 17:23 GMT+7

Prime Minister Nguyen Tan Dung has approved a power price increase of 15.28% beginning March 1, 2011.

This has been confirmed in a statement by Deputy Minister of Industry and Trade Hoang Quoc Vuong on February 19. Vuong noted that the increase is much lower than the ministry’s proposed increase of 18 percent. The price hike is also lower compared to a proposal by Electricity of Vietnam Group (EVN), the country’s sole power distributor, of 24 to 40 percent. As a result, from March 1, 2011, the country’s averaged power price will be VND1,220 (USD0.05)/kWh, instead of VND1,058/kWh, Vuong said. According to the ministry’s estimates, such power price increase could drive up the national CPI by between 0.54% and 0.7% this year. This is considered acceptable in terms of macro-economic impacts, but not an optimal solution to the electricity industry, which is in desperate need of capital for investment. Despite of the price increase, EVN is still forecast to incur as much losses as VND19 trillion (USD918.18 million) this year. The national total power output is projected at 117.6 billion kWh in 2011, up 17.63% from a year earlier. The country may consume as many as 56.11 billion kWh of electricity during the dry season of this year, up 18.3% compared to the same period last year. Source: DTI News