What direction will household electricity prices take?

The retail electricity pricing structure is being finalized with the goal of establishing a suitable electricity pricing policy for the majority of residential electricity users.

The draft "Scheme for improving the structure of retail electricity tariffs for household consumption" is currently being widely reviewed by the Vietnam Electricity Group (EVN) for finalization in October. People are still hoping for an electricity tariff structure that enhances transparency, ensures the highest level of fairness and balance of interests between the State, businesses, and consumers, and effectively implements policies for efficient and reasonable electricity use, preventing people from paying excessively high electricity bills.

Establishing a pricing structure for household electricity is necessary.

Currently, the electricity sector is implementing the retail electricity pricing structure according to Decision 28 of the Prime Minister. When designing the current retail electricity pricing structure, the electricity sector considered the actual electricity usage of four main customer groups: manufacturing customers, residential customers, administrative and public service customers, and business and service customers.

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Following the electricity price adjustment in March 2015, some customers have expressed concerns that the current retail electricity pricing structure is unsuitable, particularly for residential electricity users. In response to these customer complaints, the Ministry of Industry and Trade has tasked EVN with developing a plan to improve the retail electricity pricing structure. This plan aims to assess the current electricity usage situation, focusing primarily on residential electricity users to determine if the current retail electricity pricing structure is appropriate.

Mr. Nguyen Anh Tuan, Director of the Electricity Regulatory Authority (Ministry of Industry and Trade), stated that based on an assessment of the actual electricity usage of residential customers, EVN has considered and proposed several options with different scenarios to analyze the advantages and disadvantages of each option. In cases where the pricing structure does not match actual usage, the electricity sector must improve and adjust the retail electricity pricing structure.

According to a representative from the Electricity Regulatory Authority, after being assigned by the Ministry of Industry and Trade to inspect and assess the actual electricity usage situation in the years from 2013 to 2014 and the first eight months of 2015, EVN compiled data and proposed three options for adjusting the structure of retail electricity tariffs for household consumption.

Among the options presented by EVN, Option 1 is to maintain the current electricity tariff structure with specific analyses of its advantages and disadvantages. This is seen as a way for EVN to evaluate and compare the current retail electricity tariff with the newly proposed tariff structures, in order to have a basis for adjustment and select the most suitable retail electricity tariff structure.

"According to the Electricity Law, when the electricity sector adjusts electricity prices, Vietnam Electricity Group (EVN) holds a dominant market share of approximately 95% in the retail distribution sector. Given EVN's position and role, assigning EVN to implement the project to research and propose options for adjusting the retail electricity pricing structure is entirely appropriate," said Mr. Nguyen Anh Tuan.

Implementing a tiered electricity pricing system to regulate electricity consumption.

Through several consultation workshops on the proposed improvements to the retail electricity pricing scheme, it can be seen that the scheme focuses primarily on improving the tiered electricity pricing system, with the goal of ensuring that the new retail electricity pricing structure is suitable for low-income residential electricity users, prioritizing poor households and households receiving social welfare benefits.

Commenting on the draft plan for improving the structure of retail electricity tariffs, Mr. Hoang Van Tuy, Deputy Head of the Finance and Accounting Department of Vietnam Electricity Group, said that the plan for improving the structure of retail electricity tariffs is a research project, so it must present the most feasible and appropriate options. The plan must evaluate and analyze the impact as well as the advantages and disadvantages of each option, and then synthesize them to select a feasible option, with the goal of aiming for an electricity pricing policy that is suitable for the majority of household electricity users.

According to VOV