EVN provides information on the reasons for importing electricity.

Báo An Giang•09/06/2023

Operational inspection at Tay Hanoi 500 kV Substation. (Illustrative photo: Huy Hung, VNA)

Why import electricity?

Regarding the issue of importing electricity from neighboring countries, EVN stated that, at a meeting with several media outlets on May 24, 2023, on the electricity supply situation and related issues, Deputy Minister of Industry and Trade Dang Hoang An said the following: "The amount of imported electricity is relatively small; of which, imports from Laos are about 7 million kWh/day, and from China 4 million kWh/day. The national electricity production is over 850 million kWh/day, with the North alone accounting for 450 million kWh/day, while the total imported electricity is over 10 million kWh/day, so the proportion of imported electricity is very low, less than 1.3% of the national total. These sources are not necessarily imported only because of shortages. We have been buying electricity from China since 2005. We also import electricity from Laos under an intergovernmental agreement. We have also been selling electricity to Cambodia for a long time based on agreements between neighboring countries."

Regarding the reasons for importing electricity, according to EVN, renewable energy has developed strongly in recent years, but mainly in the central and southern regions, while electricity supply difficulties at certain times occur in the North. At the same time, due to technical limitations to ensure the safe operation of the 500 kV North-South transmission lines, supplementary power sources in the central and southern regions cannot support the North.

Regarding the negotiation and signing of power purchase agreements for transitional wind and solar power projects, in accordance with the directives of the Prime Minister and the Ministry of Industry and Trade, EVN has focused its efforts on negotiating and agreeing on provisional prices, reporting to the Ministry of Industry and Trade for approval, in order to quickly bring completed projects into operation in accordance with the law as soon as possible.

EVN has established numerous negotiating teams to be ready to exchange information and provide guidance on resolving obstacles and definitively addressing issues under EVN's responsibility, such as extending connection agreements and conducting acceptance testing. In addition, EVN has held many meetings with all investors, with representatives from the Ministry of Industry and Trade present, to resolve difficulties during the negotiation process.

As of May 31, 2023, 50 projects with a total capacity of over 2,751 MW had requested a temporary electricity price equal to 50% of the ceiling price of the electricity generation price framework for each type of power generation, as issued in Decision No. 21/QD-BCT dated January 19, 2023, by the Ministry of Industry and Trade. Of these, EVN submitted and received approval from the Ministry of Industry and Trade for 40 projects with a total capacity of over 2,368 MW. Among these, 7 projects/parts of projects with a total capacity of 430.22 MW have completed the procedures for commercial operation and electricity generation to the grid.

The remaining projects/parts of projects are completing the testing program and finalizing related legal procedures (decisions on adjusting investment policies regarding project implementation progress, land allocation decisions, construction permits, electricity operation permits, results of acceptance inspections by competent state management agencies, etc.) to be eligible for operation as soon as possible.

Vietnam Electricity Group (EVN) has also clarified the information regarding "EVN requesting an electricity price increase, but a series of subsidiaries deposited tens of thousands of dong in banks."

Accordingly, the amount of deposits mentioned in the press needs to be considered in relation to the short-term debt balance (60,045 billion VND) at the same time of the Electricity Corporations; not to mention long-term debt, considering only the short-term debt balance, it is clear that the borrowing at these units is very large, and the need to repay principal and interest in the year is very high, thus requiring the units to maintain sufficient balances to repay debts on time to ensure creditworthiness for future loans.

In addition, the aforementioned deposit balance will be used to pay off debts to suppliers, pay for electricity purchased from rooftop solar power plants and small hydropower plants at the beginning of next month according to signed contracts, and invest in a distribution and retail system to meet the growing load demand and cover operating costs.

Electricity corporations must proactively balance their cash flow appropriately to ensure timely repayment of principal and interest on loans to credit institutions, payments to suppliers and power plants as required, and are also responsible for improving the efficiency of their capital utilization.

Gradual modernization

According to Vietnam Electricity Group (EVN), its electricity distribution and business activities include the following main tasks: Investing in, constructing, operating, and managing the distribution grid infrastructure (power lines and substations) up to 110kV (including bringing electricity to rural areas, remote areas, mountainous regions, and islands); conducting business, distribution, and trading of electricity according to electricity operating licenses; customer services (providing electricity services and customer care); and other tasks (receiving electricity grids transferred from other organizations, electricity saving, etc.).

In line with the policy of modernizing customer service, since 2015 EVN has invested in, installed, and put into operation electronic meters and remote data collection systems, gradually replacing mechanical meters (which require manual measurement and recording). To date, 80.26% of the electricity metering and recording system has been digitized.

Currently, there are still approximately 6 million mechanical meters nationwide that require manual metering by staff. According to the plan, by 2025, EVN will replace all of these mechanical meters with remote electronic meters.

Regarding meter reading and verification staff across the entire Group, EVN stated that meter reading and verification are typically performed once a month. To optimize and improve labor productivity, these staff members, in addition to meter reading, also undertake other tasks such as: checking and replacing meters periodically, debt collection, power measurement, thermal imaging, troubleshooting, and customer service. Currently, the entire Group has 2,242 employees performing these tasks, corresponding to 2.32% of the total workforce.

Furthermore, in recent years, EVN has accelerated the application of digital transformation and new technologies in all its production and business activities, resulting in a reduction in its workforce of approximately 1,100 people annually on average.

By Duc Dung (VNA)

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