VietNamNet Bridge - If Electricity of Vietnam’s (EVN) exclusive role cannot be removed, private businesses will not be able to join the electricity market, even though the Ministry of Industry and Trade (MOIT) has decided to open the market to all businesses that can meet the requirements.
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MOIT has approved the detailed design for the competitive wholesale electricity market, while paving the way for businesses from different economic sectors to join the market.

The electricity sellers will comprise the power generators possessing the power plants with the capacity of over 30 MW, and the hydropower plants with the capacity of 30 MW and lower which can satisfy the requirements on infrastructure. 

The power plants invested under the BOT mode and strategic multi-purpose hydropower plants will also be able to join the competitive wholesale electricity market.

The electricity buyers will include five power corporations in the northern, southern, and central regions, Hanoi and HCM City, large consumers which buy electricity at the 110 KV and higher levels with direct connection to 220 KV transformer stations, and others which can satisfy MOIT’s requirements.

Dr Bui Huy Phung, Chair of the Vietnam Energy Science Council, pointed out that the power corporations which have the right to buy and sell electricity all belong to EVN. Therefore, the market competitiveness will be at a low level.

Meanwhile, Tran Viet Ngai, chair of the Vietnam Energy Association, noted that in the past, consumers who bought electricity at the 110 KV level could not connect directly to 220 KV transformer stations, but they bought electricity through power corporations.

With the new market structure, the five power corporations will operate independently from EVN.

However, the competitive wholesale market establishment plan does not mention the roadmap for splitting the five power corporations from EVN.

Under the plan, the competitive market will only operate on paper from 2016, and run on a trial basis from 2017 before it gradually improves by 2018. This means that a real competitive wholesale market will only take shape after 2020.

Under the new market operation, all the businesses which can satisfy MOIT’s requirements will be able to join the market. 

This means that oil & gas, mining and other private companies will be welcomed to the market.

However, Ngai pointed out that it would be very difficult for private companies to ‘squeeze into the market’ because of the strict requirements, which are beyond small power plants’ capability.

In order to become a member of the market, businesses have to have their network connected to A0 (the National Power Regulatory Center) and SCADA (supervisory control and data acquisition) system. 

Only the power plants belonging to EVN have networks connected with A0, while non-EVN companies still cannot do so.

NLD