EVNHCMC: Effective pilot implementation of the competitive electricity wholesale market

Ho Chi Minh City Power Corporation (EVNHCMC) is a typical organization in implementing the pilot phase of competitive wholesale electricity market (VWEM) and currently continues its implementation of the next phase.

The detailed design of VWEM has been approved by the Ministry of Industry and Trade with the implementation schedule including two phases: Pilot implementation between 2016 and 2018, official operation as of 2019.

The safe operation of competitive generation market has increased the transparency and equity in mobilizing electricity through bids offered by power plants; ensuring that power generation prices are set according to the objective law of supply and demand and transparentizing electricity prices according to the Government's polity. At the same time, the competitiveness of power generation has helped power generators reduce their generation costs and devise good price offering strategies in the electricity market, thereby increasing profits.

The Power System Control Center of EVNHCMC - Photo: Huyen Thuong

Recently, EVNHCMC has participated in the pilot VWEM via acquiring three power purchase agreements from the Power Trading Company with Ban Ve Hydropower Plant (320 MW); Nhon Trach 1 Gas Fired Thermal Power Plant (450 MW) and Hai Phong 1 Coal Fired Thermal Power Plant (600 MW). Through these contracts, EVNHCMC has begun to familiarize itself with the management of power purchase agreements with different types of power generation; practicing calculating payment through the Mandatory Cost – based Gross Pool and through contracts.

In 2017, the pilot VWEM maintains to be implemented by the Ministry of Industry and Trade with a higher target and workload than in 2016. In particular, operation mechanisms in the competitive wholesale market are being tested, such as: operation of the Mandatory Cost – based Gross Pool; contract allocation, contract settlement in the Mandatory Cost – based Gross Pool; contract settlement and regulation mechanism among power corporations; evaluating impacts on turnovers of power generators, electricity purchase costs of power corporations; summarizing and drawing experiences on VWEM pilot operation in order to consider, adjust and complete the operation mechanisms.

As being scheduled, in 2017, EVNHCMC carries on the pilot VWEM in three phases. Phase 1, collecting power metering data, forecasting load  curves, calculating contract allocation and calculating regulation demand among power corporations. Phase 2, simulating operation and calculating payment in the pilot wholesale market under two scenarios corresponding to two contract allocation options.  Final phase, allocating contracts for new power plants expected to operate in 2017 and 2018, allowing signing direct power purchase agreements with power corporations; based on the results of Phase 2, considering real payments after all the necessary conditions are met.

In order to achieve the objectives, EVNHCMC has developed a detailed implementation plan, defining specific works and schedule. A number of key items will be implemented, including calculation of market prices and payments in the electricity market, electricity metering; load forecasting; consideration of contract allocation; regulation mechanism among power corporations and personnel training.

To implement the pilot operation of VWEM, EVNHCMC has well prepared its information technology infrastructure; at the same time, many domestic and international training courses have been organized with the aim of improving the quality of human resources for the electricity market. In the coming time, EVNHCMC will keep conducting more advanced training courses on the following issues: contract negotiation management skills; study and forecast of load, etc.

Based on the gained experiences, EVNHCMC is confident that it will successfully implement the pilot VWEM in 2017; be prepared to join the official VWEM from 2019 in accordance with the roadmap set by the Government.

  • 29/09/2017 04:57
  • evn.com.vn