Vietnam’s Ministry of Industry and Trade (MoIT) has suggested electricity prices should rise in May in line with rising production costs, VN Express is reporting.
In Vietnam, retail electricity prices are set by the government. The state power provider, EVN, can increase prices up to 3 percent. A price hike greater than 3 percent but less than 10 percent must be approved by the MoIT, and anything greater than 10 percent must be approved by the Prime Minister.
A failure to raise prices after the Ukraine War pushed up fuel prices has led to EVN selling electricity at a loss for some time. Last year, the electricity price was raised by 7.5 percent, however, earlier this month it was reported that this was still not enough–it costs EVN about 2,092.78 VND to produce one kWh of electricity which it currently retails at 1,950.32 VND per kWh, representing a loss of VND 142.5 VND per kWh sold.
As a result of this ongoing discrepancy EVN racked up VND 37 trillion ($1.5 billion) in losses over 2022 and 2023. It’s not clear how the company is covering these losses with VN Express reporting the firm has just VND 14 trillion (US$569.6 million) in accumulated debt.