Installed power capacity has increased sharply in recent years, but Vietnam is still suffering from an electricity shortage.

Private capital is the best solution for upgrading of power transmission lines, which have traditionally been funded by the state.

With increasingly high demand for electricity and the latest 8.36 percent electricity price spike, Electricity of Vietnam Group (EVN) and other power generation companies have seen profits soar. 

While people believe that the monopoly enjoyed by EVN is the main reason behind high electricity prices, EVN affirms that prices will escalate if the company is dissolved.

Deputy Minister of Industry and Trade Do Thang Hai said recently the ministry would consider increasing the price of electricity this year.

VietNamNet Bridge - More than one electricity generator and wholesaler exists in Vietnam, but the country still does not have a competitive electricity market.

The Electricity of Vietnam’s (EVN) plan to sell electricity to manufacturing enterprises at the lowest price level will only bring benefits to foreign invested enterprises (FIEs) and eat into people’s pockets, analysts say.

VietNamNet Bridge - Several coal-fired thermal power plants in Vietnam have begun applying a high-tech method to reduce emissions. 

VietNamNet Bridge - The investment rate in solar power systems is now just equal to 20-30 percent of the rate of 10 years ago.

While Vietnamese believe that the Electricity of Vietnam (EVN), the only electricity retailer, sets high retail prices, international reports point out that the electricity price in Vietnam is lower than in other countries.

VietNamNet Bridge - More and more households plan to install solar panels on their roofs to generate electricity. Once EVN completes its policy on electricity purchase, households will be able to join the electric power market.

If Electricity of Vietnam’s (EVN) exclusive role cannot be removed, private businesses will not be able to join the electricity market.

VietNamNet Bridge - Infrastructure and conditions in Vietnam are still not sufficient to apply the market-based electricity pricing mechanism, experts say.

VietNamNet Bridge - Minister of Industry and Trade Vu Huy Hoang said last week that electricity prices from early 2016 would be determined by the market. 

EuroCham, in its latest report about foreign investors’ views about Vietnam’s energy policies, pointed out that Vietnam’s ability to attract foreign direct investment (FDI) does not depend on the price of electricity.

VietNamNet Bridge - The contract to buy electricity from China is scheduled to terminate this year. However, EVN thinks it would be better to continue importing electricity from many different sources.

VietNamNet Bridge - International consultants have said that Electricity of Vietnam (EVN) should no longer be the only electricity wholesale buyer by 2019. However, EVN wants to extend the deadline.

Figures about electricity access cited by Electricity of Vietnam (EVN) and the World Bank (WB) show different pictures. According to WB’s Doing Business 2014 report, Vietnam’s electricity-access index ranks 135th out of 189 surveyed countries.

VietNamNet Bridge - The 7.5 percent price increase in electricity prices, starting from March 16, will cost small businesses hundreds of millions of dong and big businesses billions of dong a month.

VietNamNet Bridge – The recent moves taken by state-owned corporations and management agencies signal inevitable increases in petrol and electricity prices.