EVN asks for greater leeway to increase electricity prices

Under a proposal announced by the Ministry of Industry and Trade on Friday, EVN will be allowed to increase electricity prices when input costs increase by just 1%, instead of 3% as mandated by the government since 2017.

Input costs include four phases: electricity generation; transmission; distribution and retail; and operation and management.

Generation costs, which include fuel prices, exchange rates and other factors have surged, causing EVN to suffer a loss exceeding VND16.5 trillion ($695,475,000) in the first six months.

In June, increased costs pushed EVN’s ‘average retail electricity price’, a benchmark used to determine residential and corporate electricity prices, up by 2.74 percent compared to 2019.

Under the new proposal designed to help EVN weather its current financial difficulties, if input costs push the benchmark rate by 1% to under 5%, EVN will be allowed to increase and determine new electricity prices on its own.

If the benchmark price increases by 5% to under 10%, EVN will have to wait for relevant authorities including the Ministry of Industry and Trade to review and approve any price hike it proposes.

If the benchmark rate surges by 10% or higher, only the Prime Minister can approve any new price increase.