Electricity prices may increase?

At the meeting on electricity production costs of EVN, Mr. Nguyen Anh Tuan - Director of Electricity Regulatory Authority (Ministry of Industry and Trade) said that he is building a plan for electricity supply in 2019, in which 4 operating scenarios are proposed corresponding to 2 growth rates of load and water volume. In the scenarios, the total coal-fired thermal power increased by 116 million kWh, putting pressure on increasing electricity prices.

Mr. Tuan added that with the optimal plan of 9.94% load growth, 3 billion kWh of diesel must still be mobilized; if the load growth is higher but water level is low, more diesel must be mobilized.

"In 2019, we can still ensure electricity, but at some times when the source is tense, we have to mobilize oil factories. We are also building a plan, but we also recommend using electricity economically," said Mr. Tuan.

In all scenarios, total coal-fired thermal power increased by 116 million kWh, putting pressure on electricity prices to increase.

In addition, it is forecasted that in 2019, water supply to hydroelectric reservoirs will be much worse, and gas mines will have reduced supply, so Mr. Tuan emphasized that he will direct coal supply units to prepare fuel sources based on import sources.

Mr. Dinh Quang Tri - Acting General Director of EVN said that overall electricity capacity for the next two years is "sufficient, the problem is at what price". According to EVN leaders, hydropower output is forecasted to decrease by nearly 4 billion kWh, forcing the electricity industry to increase the mobilization of resources from coal-fired thermal power, DO and FO oil.

But the difficulty is that the cost of each kWh of diesel-fired electricity is nearly 5,000 VND, much higher than other mobilized electricity sources such as coal, gas... And compared to the electricity price sold to households of 1,720 VND per kWh, the loss is relatively large.

"Using high-priced oil, electricity costs will increase and pose a challenge to the electricity price sold in 2019," said Mr. Tri, adding that EVN is currently calculating 4-5 electricity price options and will report to the Ministry of Industry and Trade.

In addition, the price of coal sold for electricity production will increase by 5% from the beginning of December. Mr. Nguyen Anh Tuan admitted that this will affect the cost of electricity production and trading in 2019. "Coal accounts for a significant proportion of the cost of electricity production, so this is a great pressure on the electricity industry. When building the electricity price scenario, we will estimate all these costs," said Mr. Tuan.

Another challenge for electricity prices in 2019 is that electricity demand growth is still above 10% and has skyrocketed in some areas. The solution Mr. Tri mentioned is rooftop solar power for households.

He calculated that each household installing 3-5 MW would be enough for daily life. With 30 million households, if only 1 million households install, this number would be equivalent to 3,000 MW. "Promoting rooftop solar power in households will partly solve the electricity shortage in the South," said Mr. Tri, and expressed hope that the Government would soon issue related regulations so that EVN could develop a plan for implementation, announce prices, and technical standards for people to install.

According to the announcement, in 2017, EVN earned more than VND2,730 billion from electricity production and trading. The amount of commercial electricity recorded was nearly 175 billion kWh. The cost of electricity production and trading in 2017 was VND1,667 per kWh, an increase of 0.15% compared to 2016. In addition, there was still over VND5,000 billion not included in the cost of electricity production in 2017.