EVN clashes with small power producers

The main reason was determined to be material prices, labour costs and an unexpectedly disadvantageous exchange rate. According to the reports, material prices have increased by 30% and interest rates have been raised from 13% to 24%, while the selling price for electricity after one year under operation has remained low at VND922 per kWh. Meanwhile, EVN has continued imports China, selling at VND1,286 (USD0.06) per kWh.

An investor of Nam Khoa 3 hydro power plant in Lao Cai Province, Duong Thi Loi said many small-cale power plants in Lao Cai and Ha Giang Province have been facing great difficulties when their power generation capacity is cut during peak hours, and end up having to take on debt. 

"We have sent several complaints to the Ministry of Industry and Trade, Electricity Regulatory Authority of Vietnam and the Northern Power Corporation (EVN-NPC) but they seem to be ignored," Loi said.

EVN-NPC, a corporation responsible for providing electricity to 27 provinces and cities, said that 12 provinces are dependent on electricity bought from China via 110kV and 220kV lines. However, because the electricity grid is old and outdated, when the small power plants generate electricity at the same time, the power they produce becomes redundant, and leaks back to China. The corporation will be fined. 

EVN's Deputy General Director, Dinh Quang Tri, said, "Power plants that produce less than 30MW must also provide their own lines to join the electricity grid. However, many enterprises use combine their production capacity in order to force EVN build the connecting lines. Many investors force us to buy their electricity by deliberately building plants even though no contract has been signed. EVN's lines will be overloaded from all theses companies. For this reason we have cut domestic generating capacity for two hours a day. We demand that the Ministry of Industry and Trade clear up the responsibility of investors for their own lines."