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Amending the Electricity Law: Need to end cross-subsidization of electricity prices between customer groups

VTC NewsVTC News07/11/2024


On the afternoon of November 7th, the National Assembly continued its plenary session to discuss the amended Electricity Law. Many issues concerning the electricity sector were analyzed and debated, including cross-subsidization of electricity prices and pilot programs for a two-component electricity pricing system. In addition, discussions focused on restarting nuclear power and how to address renewable energy, given the existing shortcomings in current pricing policies that require revision.

Representative Pham Van Hoa ( Dong Thap Provincial Delegation) proposed clarifying and supplementing specific regulations on ensuring a two-component electricity pricing structure and establishing a clear roadmap for eliminating cross-subsidization between customer groups.

According to the delegates from Dong Thap province, eliminating cross-subsidization and implementing a two-component electricity pricing system aims to ensure equality, market-based electricity pricing, and encourage electricity conservation for production. The delegates agreed with the implementation of a two-component electricity pricing system (price based on energy and capacity) to ensure clarity, transparency, and to end cross-subsidization between different customer groups.

"We cannot allow one group of customers to be charged higher prices to compensate for another group being charged lower prices. This would discourage economical use and be unfair," Mr. Hoa expressed his opinion.

Delegate Pham Van Hoa (Dong Thap Provincial Delegation of the National Assembly).

Delegate Pham Van Hoa (Dong Thap Provincial Delegation of the National Assembly).

According to Mr. Pham Van Hoa, market-based electricity pricing will prevent the electricity sector from reporting annual losses due to having to compensate for price differences. "If you buy high, you have to sell high; you can't buy high and sell low."

Regarding the amendment of many policies of the Electricity Law, Representative Ta Van Ha (National Assembly Delegation of Quang Nam province) said that in 2023, the National Assembly had a thematic supervision of the implementation of policies and laws on energy in the period 2016-2020.

“Electricity is a special commodity; it cannot simply be stored away in excess. It must meet the needs of the economy; if GDP increases by 1 unit, electricity demand must increase by 1.5 times. Therefore, electricity is an urgent issue that requires the amendment and improvement of the legal system regarding electricity. I agree with a comprehensive revision,” Mr. Ta Van Ha expressed.

Amendments to the Electricity Law: Cross-subsidization of electricity prices between different customer groups needs to end - 2

According to Representative Ha, current policies in the Electricity Law encourage the development of self-sufficient rooftop solar power. The representative proposed that the state should have a monopoly on the dispatching and operation system, while businesses should operate according to market regulations and then lease transmission lines. Article 33 stipulates that individuals and organizations investing in rooftop solar power systems up to 100kW do not need to change the land use purpose…

However, the question arises: if a factory installs a rooftop solar power system for its entire factory building, the output will certainly exceed 100kW. Would they then have to change the land use purpose of the entire factory? "I request that the drafting agency reconsider this content," the representative said.

In addition, delegate Ta Van Ha also requested that the drafting agency promptly finalize the regulations on the competitive electricity market.

Proposing a flexible pricing mechanism: Contributing his opinion in the assembly hall, delegate Thach Phuoc Binh (National Assembly delegation of Tra Vinh province) suggested that the draft law needs to supplement and clarify regulations on electricity pricing mechanisms, especially prices for different types of energy and for different regions.

"Therefore, I propose building a flexible electricity pricing mechanism based on factors such as peak and off-peak hours, geographical conditions, and energy supply," Mr. Binh said.

Representative Thach Phuoc Binh (Member of the National Assembly delegation of Tra Vinh province).

Representative Thach Phuoc Binh (Member of the National Assembly delegation of Tra Vinh province).

According to the delegates, this will encourage efficient and economical electricity use during off-peak hours, and ensure consumers' rights in accessing information about electricity prices and the price adjustment process.

Furthermore, adjustments to electricity prices should be public, transparent, and subject to oversight by state management agencies.

Regarding solutions for implementing competitive practices, the representative from Tra Vinh province suggested that the draft law needs a clear roadmap for transitioning from a privileged mechanism to a competitive electricity market. Specific regulations should be added regarding the steps to open up the electricity market, including competitive wholesale and retail electricity markets, and regulations on the responsibilities of management agencies in supervising and coordinating the electricity market to ensure fairness and transparency. Furthermore, regulations should be introduced to control monopolies by large corporations in the electricity sector to protect the interests of consumers and investors.

According to the draft amended Electricity Law, retail electricity prices are determined by electricity retailers based on electricity pricing policies, the price range of the average retail electricity price, the mechanism for adjusting the average retail electricity price, and the structure of retail electricity tariffs.

Retail electricity prices are specified in detail for each group of electricity users, in accordance with the socio-economic situation of each period and the level of electricity market development, including: production, business, administrative and public services, and household consumption.

Retail electricity prices based on time of day usage apply to eligible electricity customers, including peak, off-peak, and normal hourly rates.

For residential customers, a tiered, progressively increasing retail electricity price will be applied to those who do not qualify for or are not eligible to participate in electricity trading on the electricity market.

Cam Tu (VOV.VN)

Link: https://vov.vn/lanh-te/sua-luat-dien-luc-can-cham-dut-viec-bu-cheo-gia-dien-giua-cac-nhom-khach-hang-post1133896.vov



Source: https://vtcnews.vn/sua-luat-dien-luc-can-cham-dut-viec-bu-cheo-gia-dien-giua-cac-nhom-khach-hang-ar906162.html

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