EVN should stick to what it knows best

Under prime ministerial instructions, Electricity of Vietnam should focus on developing power sources, transmission lines and power distribution, plus totally divesting from non-core businesses by 2015.

In respect to its restructuring plan, the prime minister has underscored EVN’s core functions to be power sources and transmission lines development and power distribution parallel to maintaining electrical engineering and power construction consulting services.

He also demanded EVN to weigh over pulling itself off from power generation shareholding firms and selling all stakes in under 500 megawatt (MW) power plants.

EVN shall hold 100 per cent chartered capital in the National Power Transmission Corporation and five power corporations. Besides, EVN set up three power generation corporations pursuant to latest Minister of Industry and Trade.

Also, EVN shall directly manage multi-purpose hydropower plants which will be operating as financially dependent businesses including Hoa Binh, Tri An, Pleikrong, Ialy, Se San 3 and 4, Son La and Tuyen Quang and venture its capital into big power projects like Son La and Tuyen Quang as well as pumped storage hydropower plants.

“EVN was trusted by the government to meet the 13 per cent, per year average hike in power demand to match economic growth targets from 2012-2015,” said EVN’s deputy general director Dinh Quang Tri.

EVN’s capital demand for 2011-2015 is reportedly pegged at VND501.4 trillion ($24 billion), a 2.5-fold increase against 2006-2010. The group, however, just sourced VND315.2 trillion ($15 billion), whereas the remaining VND186 trillion ($8.9 billion) has yet to be arranged.

In respect to its divesture trajectory, EVN had divested from telecom sector when EVNTelecom was officially merged into military-run telco Viettel Group.

The group also came to the decision to gradually divest over VND1,100 billion ($52.8 million) investments from realty, securities and insurance areas.

With its VND755 billion ($36.3 million) investment into An Binh Bank to get the bank’s 25 per cent chartered capital stake, EVN has submitted to the government a plan to divest VND300 billion ($14.4 million) from the bank and sell the stake to Geleximco. However, a final decision is pending from the government.