Draft to establish Electricity Price Stabilization Fund: Increasing burden on people
The Ministry of Industry and Trade is seeking opinions on a draft to establish an Electricity Price Stabilization Fund to reduce the adverse impact of market factors on electricity prices.
However, experts' analysis shows that the establishment of this fund will be more "unstable" when consumers have to increase their contributions.
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| People having to pay money to contribute to the Electricity Price Stabilization Fund will increase the burden of paying taxes and fees. (Photo: Nhu Y) |
According to the draft Regulation on the mechanism for adjusting the average retail electricity price developed by the Ministry of Industry and Trade, the Electricity Price Stabilization Fund was established to stabilize electricity prices. The source of the Electricity Price Stabilization Fund is taken from the electricity price and is included in the cost of electricity production and business. The Electricity Price Stabilization Fund is set up when the input factors forming the electricity price fluctuate, causing the average electricity price to decrease, and the cost of electricity production and business has not been fully included in the electricity price...
Immediately, this proposal received quite a lot of disagreement. Talking to Tien Phong reporter, Dr. Vu Dinh Anh, an economic expert, said that the proposal to establish an Electricity Price Stabilization Fund is completely inappropriate in the current situation.
Mr. Anh argued: Basically, if we evaluate the effectiveness, as with the Petroleum Price Stabilization Fund in the past, it can be seen that the effectiveness of the fund has not been as expected due to some shortcomings. Meanwhile, recently, opinions from the Ministry of Industry and Trade and the Ministry of Finance also said that this fund could be considered for elimination. "With the draft proposal to establish the Electricity Price Stabilization Fund, we need to carefully calculate whether it can be implemented or not," Mr. Anh said.
Another point to note is that according to Dr. Vu Dinh Anh, the proposal to establish an Electricity Price Stabilization Fund by the Ministry of Industry and Trade in the draft has not taken into account the factors of fluctuations in electricity prices. As for gasoline prices, it can be said that they are related to international prices, so to some extent the fund can be considered as a buffer to reduce the impact of price increases. But with electricity, it is not like that.
Another point that makes people wonder is how the stabilization fund will be managed. Even if it is well managed, this fund will require a separate mechanism with accompanying personnel. This means that it will create unnecessary management costs, not to mention the story related to transparency in management.
“There are already too many extra-budgetary financial funds in existence with many management shortcomings. Is it necessary to set up another fund now?” Mr. Anh questioned.
Obscure mechanisms, increased burden
According to Dr. Le Dang Doanh, former Director of the Central Institute for Economic Management Research, the draft of the Ministry of Industry and Trade states that the Electricity Price Stabilization Fund is deducted from the electricity price and included in the cost of electricity production and business. With this regulation, if it is not clarified how much deduction from the electricity price is reasonable, when the fund can be mobilized to compensate for losses in electricity prices, when deductions from the fund will stop, as well as the initial assessment of the effectiveness of the fund, the establishment and management of the fund will lack transparency. More specifically, Mr. Doanh analyzed: The draft does not have calculated data showing whether the establishment of the fund will help EVN reduce losses, whether any country in the world has established this fund, and what are the successful or unsuccessful experiences?
Assoc. Prof. Dr. Ngo Tri Long, former Deputy Director of the Institute for Price Science Research, said: The formation of a price stabilization fund is necessary for businesses that bear high price risks. But "the source of the fund must come from both sides, businesses and consumers. It is impossible to force consumers to pay in advance like the gasoline stabilization fund. "As a risk reserve in business, businesses must also deduct from profits. On the other hand, the mechanism for forming a stabilization fund must be transparent: where the fund comes from, how to use and manage it effectively," said Mr. Long.
According to an expert in the electricity industry, in essence, people themselves must contribute money to the stabilization fund, because the fund is deducted from the cost of electricity sales. The formation of the fund is basically only meant to reduce losses for EVN, while the fund will cover the losses and increase the burden on people. Even in the price adjustment mechanism, when input factors decrease, the fund is deducted, then EVN must reduce the average electricity price. Therefore, the formation of the fund at any time needs to be considered.
According to VOV
