EVN eyes another round of electricity price hikes
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Vietnam Electricity has sought the Government’s permission to hike power tariffs soon saying production costs have risen sharply.
The average electricity price was increased by 3% on May 4 to VND1,920.37 (8 U.S. cents) per kilowatt-hour (kWh).
But the cost of production had surged by 9.27% last year to VND2,032.26, and so its financial situation has not improved even after the price hike, according to the state utility.
EVN, the country’s sole power distributor, faces cash flow difficulties and is likely to default on payments to independent power producers.
It has sought interest-free loans from the central bank to pay them.
Over the past two years EVN has reduced spending on repairs by 10-50% due to the cash crunch, severely affecting the safety of the electrical network.
EVN made a loss of over VND36.29 trillion in 2022, the Ministry of Industry and Trade said.
Questions & Answers
Q.Why does EVN want to increase electricity prices again?
Why does EVN want to increase electricity prices again?
EVN states its production costs rose sharply last year, exceeding the recent 3% price hike. Its financial situation has not improved, leading to current cash flow difficulties for the state utility.
Q.What impact have EVN's financial problems had on its operations?
What impact have EVN's financial problems had on its operations?
Due to cash flow difficulties, EVN has reduced spending on repairs by 10-50% over the past two years. This has severely affected the safety of the electrical network and its ability to pay independent power producers.
Q.How much money did EVN lose in 2022?
How much money did EVN lose in 2022?
The Ministry of Industry and Trade reported that EVN made a loss of over VND36.29 trillion in 2022. This substantial loss contributed to its ongoing financial difficulties and the need for further price increases.
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