Power shocks to continue

According to a 2010 socio-economic report and 2011 socio-economic development orientations the Vietnamese government submitted to the National Assembly’s Standing Committee this month, Vietnam’s economy had resumed its growth trend quickly in 2010, in which the gross domestic product (GDP) grew 7.18 per cent in the third quarter against the second quarter’s 6.4 per cent and major economic indexes were fairly stable. However, the economy was also exposed to a number of limitations.

The first limitation is unstable power supplies attributed to a decline in hydropower sources in the dry season and a slow-down in the construction of thermo-power plants.

Government Office chairman Nguyen Xuan Phuc said a lack of strong measures to quicken the construction of power plants was to blame.

Meanwhile, the National Assembly’s Economic Committee chairman Ha Van Hien ascribed the lack of power for production, business and living requirements in the early months of 2010 to slowness in bringing power network and source projects during 2010-2011 online.

According to Ministry of Industry and Trade (MoIT)  figures after a survey of 35 under-construction power plants and 16 others about to break ground, 46 projects (90 per cent) reported delays of at least two to six months. The total power capacity brought online in 2010 is around 2,612 megawatts only, down 723MW compared to projections, irrespective of the 350MW of delayed power incurred from 2009.

According to 2011 socio-economic development orientations to be submitted to the National Assembly for approval in the upcoming eighth session in late this month, GDP growth will be around 7-7.5 per cent equal to $112.8-113.8 billion with an average per capita income of between $1,290-1,300, total export value will see a jump of 10 per cent against 2010, the state budget’s over-expenditure will be kept at less than 5.5 per cent and consumer price index below 7 per cent.

Therefore, the MoIT estimated the demand for power would hike around 15 per cent against 2010’s implemented level to meet 2011 socio-economic development needs. Similarly, total capacity of power plants was around 20,295MW in 2010, increasing to 24,880MW in 2011, or 4,585MW more, according to the MoIT.

With normal hydrology, total power sources, from domestic production and imports, Vietnam plans to import 700MW from China and 250MW from Laos to satisfy the domestic demand. However, if a power source project saw a delay in construction or unfavourable weather power outages would continue, Phuc noted.

The MoIT also anticipated 2013 and 2014 would see a critical shortage of power. “To address the impediment, drastic measures must be taken from now on to speed up the construction of power plants and recalculate electricity selling prices to lure investors,” Phuc said.