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Ministry firm on new power prices   2009-03-29 - VietNamNet/VNS

 
 Despite objections from enterprises to changes to peak hours used to calculate electricity prices, Deputy Minister of Industry and Trade Bui Xuan Khu confirmed a separate price structure would apply during the morning peak.

The new power price policy would reduce the gap between power consumption in peak hours and that in off-peak time to help secure the safety of the electricity system, encourage saving and ensure uninterrupted supply, Khu told journalists yesterday.

Under the ministry’s new rules, calculations are based on normal, peak and off-peak hours. Peak hours are 9.30-11.30am and 5-8pm daily except for Sunday. Off-peak hours are 10pm-4am on all weekdays. The rest fall into the normal time category. Previously, peak hours were 6-10pm and normal time was from 4-6pm.

Production prices in peak hours will be VND1,900 per kWh; off-peak hours VND540 per kWh and normal hours VND955 per kWh.

Many enterprises have said their costs for electricity will increase under the regulations, some suggesting a rise of 30 per cent. This will force them to raise their product prices, which makes it harder to sell their products, and also harmes their competitiveness, especially during the recession.

Some companies said production could not avoid peak hours, as it would disrupt their operations.

Deputy chairman of the Viet Nam Association of Seafood Exporters and Producers Nguyen Huu Dung said: "One characteristic of seafood processors is that materials often reach factories in the early morning and are processed immediately to keep them fresh."

Dung estimated the changes would see electricity costs for seafood producers shooting up by 15 to 17 per cent.

Director of the ministry’s Electricity Regulatory Authority Pham Manh Thang said the system had to generate 7,000MW in off-peak hours and 11,500MW during peaks.

"Calculating power prices basing on usage time will help improve the economic efficiency of the power system, partly ease the pressure of investing in electricity sources and then ease the pressure of increasing prices and bring benefits to the whole economy," Thang said.

With the new method, the difference in electricity usage in peak and off-peak hours would reduce to 100-200MW, instead of 500-600MW, he said.

The ministry calculated that under the new prices, costs for enterprises would be 1 to 18 per cent higher and that product increases would range from 0.1 to 3.6 per cent, depending on production schedules.

Because the new policy had only applied since March 1, more time was needed to assess its influence, Khu said.

The Ministry of Industry and Trade would co-operate with related ministries and sectors to assess the influence and find solutions for each group of enterprises with difficulties, he said.


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