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Ensuring transparent power and petroleum prices

Ensuring transparent power and petroleum prices - 

Minister of Industry and Trade Vu Huy Hoang underlined the Ministry of Industry and Trade (MOIT)’s opinion that electricity and petroleum prices must be publicized and transparent on a Vietnam Television Q&A session on May 11.

He said the National Assembly and the government’s guideline was that prices of goods which were essential to production and people’s lives must be made public and transparent because prices of these goods were related to user interests. Notably, electricity and petroleum prices can change in accordance with market mechanisms but under the state’s regulation.

Under the Electricity Law and prime ministerial decisions, since July 1, 2012, the electricity sector has put the competitive power generation market into official operation. This allows power plants to offer selling prices and buyers can choose to buy electricity from the power plant which offers the lowest price. So far, 49 power plants with total capacity of 12,300MW, accounting for 42 percent of the total design capacity of the entire national power system, have joined the market. Minister of Industry and Trade Vu Huy Hoang said that joining this market, power plants must strive to reduce production costs, allowing people to buy electricity at lower prices. He admitted that in the past the publicity and transparency of electricity and petroleum prices was not ensured. Instruction 11/CT-BCT dated April 22, 2014 is expected to provide people with access to clear and sufficient information about power and petroleum production.

The instruction was issued with the aim to make electricity and petroleum prices public and transparent, allowing people to supervise the operations of power and petroleum production units as well as management activities of relevant state authorities. It allows people to buy electricity and petroleum at suitable prices, encouraging them to use these kinds of goods efficiently.

Making the market healthy

Following the prime minister’s guidelines, to ensure the healthiness of the power and petroleum markets, Minister Vu Huy Hoang has provided instructions for the Electricity Regulatory Authority of Vietnam (ERAV), the Electricity of Vietnam Group (EVN), the Vietnam National Petroleum Group (Petrolimex) and other organizations concerned to make public power trading activities, especially prices.

At a regular press conference held by the MOIT in April, ERAV Director Dang Huy Cuong said that ERAV would coordinate with the EVN to make public electricity prices and pricing components as well as price adjustments.

In fact, the EVN has paid special attention to ensuring the publicity and transparency of electricity prices. EVN General Director Pham Le Thanh said the publicity and transparency of prices was an important factor helping promote competitive power generation and laying the foundation of a competitive power retail market.

Regarding petroleum, Minister Vu Huy Hoang provided guidance for the Domestic Market Department to coordinate with Petrolimex and other units concerned to publicize petroleum trading activities, especially prices and pricing components as well as the formation, management and use of the price stabilization fund.

Petrolimex Deputy General Director Tran Ngoc Nam said the group had publicized petroleum prices in accordance with Instruction 11/CT-BCT. Petrolimex is committed to seriously abiding by regulations of the state, the MOIT and related laws. However, ensuring the publicity and transparency of petroleum prices requires not only business efforts but also the combination of five factors: institutional transparency, overall operation, publicity of addresses, timely information, and unbiased assessment.

Source: VEN

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