Therefore, retail electricity price will be adjusted to VND1,864.04 per kilowatt from VND1,720.65 per kilowatt.
Below 10 percent increase in electricity price comes within the jurisdiction of the Ministry of Industry and Trade (MoIT) after the Prime Minister’s permission.
From 2010 to now, electricity price has been adjusted for seven times. The latest adjustment was at the end of 2017.
According to the Decision 24 of the PM, there must been an adjustment in power price in 2018. However, it was kept unchanged in order to achieve the target to stabilize the macro-economy despite the fact that increasing costs have greatly affected electricity industry. Eventually, an adjustment in electricity price cannot be delayed longer.
Vietnam Electricity (EVN) has rechecked every expense that affects power price. The PM also gave permission to raise electricity price in the first quarter of this year.
In recent years, large projects, especially the coal-fired electricity plant of Vietnam Oil and Gas Group and Vietnam National Coal – Mineral Industries Holding Corporation Limited, were behind schedule so in order to meet an electricity consumption demand of above 10 percent, electricity industry has mobilized high-cost power source from gas, oil and coal which affects heavily power price when the prices of oil and gas sharply increase. In addition, environmental fees and exchange rate have also contributed to an increase of thousands of billion Vietnamese dong in expenses of EVN.
In previous adjustments, electricity price was raised by 6 percent upwards. If being fully calculated, electricity price may climb by nearly 10 percent. However, the Government has allowed an increase of 8.36 percent after calculations.
The detail announcement on power price rise will be released this week or next week, said Mr. Vuong.
According to the MoIT, the country’s electricity price was more than 7 cent before adjustment and will be nearly 8 percent after adjustment. Meanwhile, power price of India is 8 cent, China 8 cent, Laos 9 cent, Indonesia 10 cent and Canada 11 cent.
Mr. Hoang Quoc Vuong said that an increase in power price would likely to reduce gross domestic product growth by 0.22 percent and increase consumer price index by 0.29 percent.