According to Mr. Nguyen Anh Tuan - Head of Electricity Regulatory Authority of Viet Nam, Ministry of Industry and Trade, implementing Decision No. 24/2017/QD-TTg dated 30 June 2017 of the Prime Minister on mechanism for adjusting average electricity retail tariff, the Ministry of Industry and Trade issued Decision No. 3134/QD-BCT dated 31 August 2018 on inspecting power production and business cost (P&B) in 2017 of Viet Nam Electricity.
The delegation inspecting cost for power P&B of EVN in 2017 includes representatives from: the Government Office, Ministry of Industry and Trade, Ministry of Finance, Ministry of Labour - Invalids and Social Affairs, National Assembly’s Economics Committee, Viet Nam Electrical Engineering Association, Viet Nam Standard and Consumer Association, Viet Nam Chamber of Commerce and Industry.
The delegation inspected reality at the Holding Company - EVN and some member units of EVN.
Mr. Tran Tue Quang - Deputy Head of Electricity Regulatory Authority of Viet Nam announcing power production and business costs of EVN in 2017
Mr. Tran Tue Quang - Deputy Head of Electricity Regulatory Authority of Viet Nam said that in 2017, commercial power output was 174.65 billion kWh; the total power loss rate of EVN was 7.24%, 0.36% lower than the expected rate and 0.33% lower than the actual rate of EVN in 2016 (7.57%).
Total cost of power production and business in 2017 was VND 291,278.46 billion (income from liquidation and sale of fixed assets and recovered materials, income from leasing electric poles which has been deducted in power production and business cost).
The cost of power production and business in island districts and communes of the areas that have not been connected to the national power grid is accounted into power production and business cost in 2017. Total price compensation for power production and business costs in the communes and districts was VND 184.33 billion.
Electricity revenue in 2017 was VND 289,954.78 billion; corresponding to the average implemented commercial electricity price of VND 1,660.19/kWh.
Deputy General Director in charge of duties and tasks of EVN’s General Director - Mr. Dinh Quang Tri answering questions related to EVN’s P&B cost.
In 2017, the impacts by hydrological situation reduced power production and business costs. However, some key factors that raise power production and business costs include: Coal price increasing by an average of 5.7% compared to 2016; average price of DO and FO oilincreasing by 21.95% and 32.84%, respectively, compared to 2016; the world’s HSFO oil price increasing by 39.2% compared to 2016, leading to high gas price in the market.
Bedises, the costs for granting water resource mining rights has been applied sicne 1 September 2017, water resource tax rate increase has been applied for the whole year of 2017 and the US dollar (USD) rate has also increased compared to 2016.
Through the inspection results at EVN, income from activities related to power production and business in 2017 was VND 4,115.76 billion. Thus, with power production, business and its related activities in 2017, EVN gained VND 2,792.08 billion of profit (excluding income from other productions).
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Principles for inspecting power production and business costs:
1. The costs of power production and business only consist of production and business cost of activities in electricity field, excluding others.
2. Costs of power generation, transmission, distribution, auxiliary and sector management are separated.
3. Cost for purchasing electricity from independent, equitized power plants which have signed electricity purchase agreements with EVN, power plants under one-member limited companies independently accounting with EVN is determined through electricity purchase agreements.
4. Cost for power production from power plants dependently accounting with EVN is determined through cost data certified by independent auditors as a base.
5. The inspection of power production and business costs in 2017 is based on documents provided by EVN and its member units.
6. The inspection of power production and business costs in 2017 excludes inspecting EVN’s compliance with provisions of the law on managing, using capital and asset, regulations on corporate income tax and finance, regulations on investment, bidding for construction of power works, procurement and liquidation of equipment.
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