Nation continues to fight power shortfall

Vietnam is racing to modernise its power infrastructure

It will sell some five billion kilowatt hours of power to Vietnam this year, similar same to last year’s amount.

That figure is higher than Electricity of Vietnam’s (EVN) earlier plan in which it expected to be able to buy some 4.56 billion kWh from China.

The state-run corporation had also completed price negotiations with the Chinese partners for 2011, an EVN official told VIR, but declined to reveal the exact price. He, however, admitted that the new price was higher than last year, adding that the Vietnam had to accept it in order to ensure supply for local consumption.

Another source said Chinese producers requested to raise the price to between 6-7 US cents per kWh from 5.1 US cents sold to Vietnam last year.

“Both sides are drawing up contents for the deal, which will be signed soon after that,” said the EVN official.

Chinese electricity is currently used to supply northern mountainous provinces in Vietnam including Thai Nguyen, Cao Bang, Bac Kan, Phu Tho, Vinh Phuc, Son La, Dien Bien, Lai Chau, Lao Cai, Tuyen Quang, Yen Bai and Ha Giang.

Since last year, the Vietnamese government considered power supplies from China a long-term important source for the country, which is predicted to continue facing serious shortages this year.

In the first two months of 2011, Vietnam bought nearly one billion kWh of power from China, up 29 per cent from last year’s corresponding period and making up 6 per cent of the whole electricity output in Vietnam during the period. In February, Vietnam bought 421 million kWh from China, almost doubling the amount during last year’s corresponding period.

According to the Ministry of Industry and Trade (MoIT), the national power system will be able to provide some 38 billion kWh during March-June, the final stage of the 2011’s dry season, meeting a 15 per cent increase in demand.

The MoIT predicted that power consumption in this dry season would grow at around 18.3 per cent. The growth rate will be then at 16.8 per cent in the second half of the year.

The Vietnam-China power purchasing commitment for 2011 came after the Vietnamese government raised domestic market retail power prices by 15.3 per cent to an average VND1,242 (6 US cents) per kWh, applied from March, this year. According to Tran Viet Ngai, chairman of the Vietnam Energy Association, the price was not as important as stable supply for Vietnam since the country had always been threatened by power cuts.

The power supplied from China is almost equivalent to the power consumption of steel or cement manufacturing industries in Vietnam every year, according to EVN figures.

Power output in Vietnam will reach nearly 295 million kWh per day in March, 15 per cent higher than the level of 257 million kWh per day reported in February.