Completing preparations for the operation of the competitive electricity market

On July 1, Vietnam's competitive power market will officially operate. At this point, all preparations have been completed. Power generation companies are ready to enter the market.

According to Mr. Ngo Son Hai - Director of the National Power System Dispatch Center, Vietnam's competitive electricity market consists of two main component markets: The contract market is where electricity generating units sign contracts with a single wholesale buyer under a contract mechanism and the spot electricity market applies a centralized dispatch market model with cost-based pricing.

The national grid system is ready to serve the competitive electricity generation market.

Therefore, in the competitive electricity market, all electricity generated by power plants is sold to a single wholesale buyer, and the schedule for mobilizing units is established based on the variable cost price quotation. Electricity purchased and sold is paid according to the contract price and the spot market price of each trading cycle through a contract for difference.

Accordingly, the rate of electricity paid at the contract price for the first year of the market is set at 90% - 95% of the total electricity output of the plant, the rest is paid at the spot market price. This rate will be gradually reduced in the following years to increase competitiveness in electricity generation activities, but not lower than 60%.

The units participating in the electricity generation competition include power plants with a capacity of 30 MW or more, connected to the national grid (except wind power and geothermal power plants). The sole wholesale buyer is the Electricity Trading Company under the Vietnam Electricity Group. The unit operating the electricity system and the electricity market is the National Electricity System Dispatch Center. The unit providing electricity transmission services is the National Power Transmission Corporation.

According to VGPNEWS - H