Electricity price adjustment from November 9, 2023: How will it impact electricity customers?

That is one of the interesting information at the information exchange session on adjusting retail electricity prices jointly organized by the Ministry of Industry and Trade and Vietnam Electricity, on the afternoon of November 9, 2023.

The electricity price adjustment is carefully calculated

According to Decision No. 1416/QD-EVN, from November 9, the average retail electricity price is adjusted to VND 2,006.79 /kWh (excluding value-added tax). This electricity price adjustment (EPA) has been carefully calculated by EVN to minimize the impact on the economy and people's lives.

Sharing about the basis for adjusting the average retail electricity price, Mr. Nguyen Dinh Phuoc - Chief Accountant of EVN said that this EPA is based on a political basis, legal basis, and practical basis. Specifically, Resolution No. 55-NQ/TW dated February 11, 2020, of the Politburo on the orientation of Vietnam's National Energy Development Strategy to 2030, with a vision to 2045, requires: "apply the market prices for all types of energy" and "remove all barriers to ensure transparent energy prices determined by the market".

EVN's retail price adjustment is also implemented in accordance with Decision No. 24/2017/QD-TTg dated June 30, 2017, of the Prime Minister regulating the mechanism for adjusting the average retail electricity price.

Clause 5, Article 3 of Decision No. 24/2017/QD-TTg stipulates: "The average time to adjust the electricity price is at least 6 months from the most recent electricity price adjustment" and Clause 2, Article 3: "During the year, the average electricity selling price is considered for adjustment when the basic input parameters in the electricity generation stage fluctuate compared to the parameters used to determine the current average electricity selling price."

Overview of information exchange meeting

In 2023, input costs for power production will increase, continuing to affect EVN's costs. Specifically, due to the impact of El Nino, hydropower output - a cheap source of electricity - decreased by nearly 17 billion kWh compared to that in 2022; The output of mobilized coal, gas, and oil thermal power plants has increased.

Meanwhile, input fuel prices for power plants increased and remained at a high rate. NewC Index imported coal price is expected to increase by 186% in 2023 compared to that in 2020 and 25% compared to that in 2021; The price of mixed coal of Vietnam National Coal and Mineral Industries Holding Limited (VINACOMIN) is expected to increase on average from 29.6% - 46.0% compared to that in 2021; Dong Bac Corporation's mixed coal price increased on average from 40.6% - 49.8% compared to that in 2021. Brent crude oil price is expected to increase 100% compared to the average price in 2020 and increase 18% compared to that in 2021. In particular, the foreign exchange rate in 2023 will also increase sharply, expected to increase by 4% compared to that in 2021. These factors have directly affected EVN's electricity purchase costs and electricity prices.

Mr. Nguyen Dinh Phuoc also said that in 2022 and 2023, EVN has synchronously and drastically implemented cost-saving solutions such as Regular cost savings of 15%; Major repair costs are cut down at a very high level; Maximal savings gained in administration, and so on.

Poor households and policy families are insignificantly affected

According to assessment data from the General Statistics Office, this EPA is expected to increase the CPI in 2023 by only about 0.035%.

Basically, this EPA ensures that poor households and policy families are only affected to a negligible extent. According to statistics, by 2022, the country will have over 1.27 million poor households and social policy households receiving support in electricity bills in accordance with the Government's policy. Specifically, poor households are supported with a monthly support equivalent to the amount of electricity consumed 30kWh/household/month; Social policy households with electricity consumption of no more than 50 kWh/month will receive support equivalent to the capacity of 30kWh/household/month.

In addition, based on statistical data on electricity customers in the first 9 months of 2023, EVN also made specific calculations on the impact of each type of electricity customer.

Specifically, for customers using electricity for domestic purposes, after the price adjustment, each household consumes less than 50kWh of electricity/month, the average additional electricity bill (AEB) is about VND 3,900 /household; Households consume 51-100 kWh/month, the average AEB is about VND 7,900 /household; Households consume from 101-200kWh, the average AEB is about VND 17,200 /household (this is the customer group accounting for the largest proportion of customers using electricity for domestic use (accounting for 34.08%)); Households consuming from 201-300kWh, the average AEB is about VND 28,900 /household; households consuming from 301-400kWh, the average AEB is about VND 42,000 /household; households consuming from 401kWh or more, the average AEB is 55,600 VND/household.

For manufacturing and service businesses, the impact of adjusting electricity prices depends on customers' electricity usage behavior and the proportion of electricity usage in the total cost of the business.

Specifically, service business customers (547 thousand customers), after changing prices, will pay an average of VND 230,000 /month for electricity; Production customers (1,909 thousand customers), on average, will pay an AEB of VND 432,000 /month; Administrative and business customers (681 thousand customers), on average each month will pay an AEB of VND 90,000 /month.

  • 08/11/2023 12:34
  • evn.com.vn
  • 111