http://www.psiru.org/reports/critique-proposed-amendments-electricity-law-vietnam Vietnam’s
power sector is dominated by Electricity Vietnam (EVN), which is the
integrated state-owned monopoly that covers all elements from generation
to retail. It is experiencing a number of serious issues that involve
the efficiency of management of EVN, delays in upgrading the
transmission/distribution system, and the inability to meet national
demand without large-scale imports. The
government bodies including MOIT (Ministry of Industry and Trade) and
MOF (Ministry of Finance) both believe Vietnam needs to change the
current sector arrangements, from price setting, to reorganization of
EVN and to overall sector restructuring towards a market-driven system
of supply and demand.
In
2011, MOIT put forward proposals to revise the reform roadmap for the
sector set out in Electricity Law 2004. A decision on these proposals is
not expected until late 2012. The proposal is being questioned on
grounds the rationality of bringing forward the introduction of a
competitive retail market and on the inflationary effects of the
proposed electricity price increases and the degree of efficiency
improvement required of EVN.
This paper provides a critique of the impacts of the proposal on
Vietnam’s politics and economics and a global review of the electricity
liberalization model that underlies such policy.
Written by - David Hall - Steve Thomas - Tue Anh Nguyen
Advice from PSIRU www.psiru.org
