New electricity pricing structure: Using over 400 kWh will cost double the price.

This new electricity tariff for household consumption is expected to remain the same as it was nearly four years ago, divided into six tiers with progressively increasing prices; the more electricity consumed, the higher the price. This means that customers using electricity in the highest tier will pay up to 1.74 times more than those in the lowest tier. That's almost double the average electricity price.

No change in high electricity consumption, high prices.

"Even at my own home, I can never keep track of my electricity bill with the current six-tiered pricing system," commented Mr. Nguyen Tien Thoa, Vice Chairman and General Secretary of the Vietnam Valuation Association, regarding the Ministry of Industry and Trade's consultation on the retail electricity pricing structure.

In this draft, the retail electricity price for residential customers is still divided into 6 tiers, with prices increasing progressively; the more electricity consumed, the higher the price. This price structure has been in effect since the beginning of 2014, with an average retail electricity price of 1,622.01 VND/kWh.

Specifically, customers using 0-50 kWh enjoy the lowest price of 1,484 VND/kWh. Meanwhile, customers using 401 kWh or more have to pay nearly twice the average retail electricity price, up to 2,587 VND/kWh.

This means that electricity customers at the highest consumption level pay up to 1.74 times more than customers at the lowest consumption level.

Current retail electricity price list for household consumption.

The Ministry of Industry and Trade explained that this pricing structure "aims to encourage the economical and efficient use of electricity." Furthermore, it is based on the experience of countries around the world, as well as within the ASEAN region, such as Japan, South Korea, Hong Kong, South Africa, Indonesia, Thailand, and Malaysia, all of which apply tiered electricity pricing for household consumption.

Based on an assessment of its implementation over the past three years, the Ministry of Industry and Trade believes that the tiered pricing system for household electricity is "simple to apply" while still achieving the goal of encouraging "efficient and economical electricity use."

Therefore, in the draft decision, the Ministry of Industry and Trade continues to propose designing electricity prices for household consumption according to the current 6-tier system, which has been in effect since 2014.

According to experts, after several years of maintaining the same price list while people's lives have changed significantly, the price list developed by the Ministry of Industry and Trade has not yet reflected real-life situations.

Mr. Nguyen Tien Thoa, former Director of the Price Management Department (Ministry of Finance), stated: "Nowadays, even poor households rarely use less than 50 kWh. Life has changed; there are more electrical appliances... things are very different now, so we must consider how to ensure that the vast majority of people can enjoy a relatively reasonable price."

For the time being, this expert suggests that the residential electricity tariff could be improved to reflect changes in living standards, making it easier for consumers to monitor and for the electricity sector to manage metering more clearly.

In fact, in March 2015, after the six-tiered retail electricity pricing system was implemented, many controversies erupted. At that time, the Ministry of Industry and Trade and Vietnam Electricity Corporation had to organize workshops across all three regions to gather feedback on the proposed improvements to the electricity pricing system.

According to VNN