Rising electricity prices put pressure on spending

Not only the manufacturing industry uses a lot of electricity, but also businesses, small shops, households... are also negatively affected by the increase in electricity prices.

Just heard the news electricity price increased by 4.8% to over 2,100 VND/KWh since October 11, Mr. Tran Minh Dang (living in District 11, Ho Chi Minh City) could not help but feel discouraged when estimating that his family's electricity bill could be over 1 million VND/month.

Pressure to increase costs

"My husband and I rent an apartment. The landlord installed an old air conditioner and refrigerator that consumes a lot of electricity, so the electricity bill is as high as renting a house, but we can't actively replace electrical equipment like in our own home," Mr. Dang complained.

Mr. Dang added that the apartment he lives in has a market and a residential area below. There are many karaoke theaters all day and night, which are very noisy, so he rarely opens the windows to use natural light and wind. Instead, he keeps the lights and air conditioner on all day and night, making it difficult to save electricity.

Mr. Vo Van Duy, a student at the University of Transport, Campus 3 (District 12, Ho Chi Minh City), is worried that the landlord will increase in price electricity in the coming time, the amount of money that the family has to pay every month will increase. "I live with 2 friends, the landlord charges 3,500 VND/KWh for electricity, which is about 150,000 VND/month. Some other boarding houses have increased the electricity price to 4,000 - 5,000 VND/KWh, I wonder if it will spread to this boarding house?" - Mr. Duy worried.

Concerned about the rising cost of electricity bills, Ms. Nguyen Ngoc Han (District 8, Ho Chi Minh City) said that Ho Chi Minh City is in the rainy season, the weather is cool so her family rarely has to turn on the air conditioner, the electricity bill is not too high. However, when the peak hot season comes after Tet, the electricity bill will skyrocket, the burden of electricity bills will weigh more heavily on the family's expenses.

"The most worrying thing is that near Tet, manufacturing enterprises and distributors will use the reason of increasing electricity prices to increase the prices of goods. When Tet comes, many things have to be bought even though they are expensive, and we cannot save money like usual," said Ms. Han.

Ho Chi Minh City Electricity staff instruct people on how to save electricity in daily life. Photo: THANH NHAN.

Business people "bite the bullet"

Ms. Hoang Ngoc Em, owner of 2 pho restaurants in Binh Chanh district (HCMC), estimated that she could spend an additional 600,000 - 700,000 VND/month due to the increase in electricity prices. According to Ms. Ngoc Em, the operating cost of 2 restaurants is about 70 million VND/month, with electricity alone being about 11 million VND/month. This month, the electricity bill has increased by nearly 5%, the price of some herbs has nearly doubled while the number of customers has decreased by 10% - 15% compared to the summer months, so income will decrease and expenses will increase.

"My restaurant uses an electric pot, so even if there are fewer customers, we still have to cook for the same amount of time. On weekends when there are more customers, we sometimes have to cook 2 pots, which incurs more electricity costs. However, increasing the price at this time will mean losing customers, so we have to endure it and wait until Tet to adjust the price," Ms. Ngoc Em reflected.

At the enterprise level, the increase in electricity prices will increase operating costs, directly affecting the profits of enterprises, especially for industries that use a lot of electricity such as cement, iron, steel, frozen seafood, etc. "If enterprises increase prices at this time, they will lose the market, so they have to calculate very carefully. For now, they have to accept a decrease in profits, then consider whether there is any other way to reduce financial losses" - said the director of a food processing enterprise.

In the field of industrial production, Mr. Nguyen Van Khanh, Permanent Vice President of the Ho Chi Minh City Leather and Footwear Association, is concerned that the increase in electricity prices will cause the total production costs of enterprises to increase, which will be a real burden in the context of many difficulties in the industry, with orders having been negotiated and in the implementation phase, so there is no opportunity to adjust prices.

Some businesses are worried that electricity prices may continue to increase in the near future when EVN continues to report losses and applies the regulation of adjusting electricity prices periodically every 3 months. Therefore, in addition to energy saving solutions, businesses have considered investing in rooftop solar power to both increase the "green" factor in their business profile and reduce cost pressure in the long term.

According to Dr. Nguyen Bich Lam, former General Director of the General Statistics Office, if electricity prices increase by 10%, the consumer price index of the entire economy will increase by 0.33%. Thus, the increase in electricity prices will not have much impact on inflation this year. However, the increase in electricity prices will increase production costs for businesses, reduce profits and increase household consumption costs.

"Businesses are forced to adapt and find solutions to save costs and rearrange production structures, but cannot increase product prices because it will reduce competitiveness," Mr. Lam said.

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