Companies oppose the plan to apply separate power prices for the cement and steel industries that are 2% to 16% higher.
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The issue was discussed during a workshop on sustainable development for the cement and steel industries held yesterday, July 24.
Lai Quang Trung, Deputy Director of Vinausteel Joint-Venture Company said, "The leaders of the electricity industry should ask themselves how much the people and other industries will suffer as a result of this price increase. Will it have good impact on the economy? It seems clear that the decline of the cement and steel industries would have negative impacts."
Haiphong was once the biggest steel manufacturing hubs factory in the country, but four factories with a capacity of producing 1.3 million tonnes a year and several other, smaller factories have shut down leaving 2,000 labourers out of work. Many more companies are in trouble and may soon face bankruptcy if the power price hike goes through.
Trung added that the leaders of electricity companies are just making it harder on themselves. "If prices are raised customers will be lost. I know of about five factories that owe a total VND10 billion (USD480,000) for electricity," he said.
According to Bui Quang Chuyen, deputy head of the Heavy Industry Department under the Ministry of Industry and Trade, the cement and steel industries consume 11% to 12% of total energy produced. However, this figure is decreasing because factories are becoming more efficient with the implementation of new technologies. In the near future many cement factories are expected to self-produce 15% of their power.
Tran Viet Ngai, President of the Vietnam Energy Association, said that power prices must increased, "The electricity consumption of cement and steel plants is definitely higher than 11% to 12%. The price hike will help to speed up the use of new technology."
President of Vietnam Cement Association, Nguyen Van Thien, called it price discrimination and countered that even electricity plants use outdated technology.
Though Ngai affirmed his opinion about charging electricity and cement plants more, he added that the price should not be too high.