Surge of power plants to plug into Viet Nam market

Surge of power plants to plug into Viet Nam market

An additional 16 power plants will join Viet Nam’s competitive energy generation market this year, bringing the total number of such plants to 48.
The country launched the market last July in a move to shift the State’s monopoly of power supply to a more competitive market system.

As such, power plants with capacities reaching 30MW or above (except wind or thermal powered ones) are eligible to join the market by selling their product to the Electric Power Trading Company (EPTC) under the management of State power firm Viet Nam Electricity (EVN).

EPTC - the single buyer in the country’s power market - in turn sells off electricity to distribution or retail companies from whom customers can buy electricity for daily use.

Speaking at a meeting on Thursday, Deputy Prime Minister Hoang Trung Hai asked relevant agencies to finalise procedures allowing the participation of the new sellers, thus helping to raise the power market’s competitiveness.

He said that the initiative is creating transparency by mobilising power sources and ensuring that selling prices are based on supply and demand rather than the subsidised mechanisms that were adopted in the past.

“This helps improve the competitiveness in power generation, a positive signal to attract more investors to the power sector,” he said.

Under the seven-month old system, power plants which offer lower prices will be given priority to sell their electricity. A network among plants and the EPTC has been set up to update market information and estimate demand and potential supply.

At present, among 73 generators on the market, 32 generators directly sell power to the single distributors. Meanwhile, indirect traders include multi-purpose hydro-power plants, Fast Start Reserve, Cold Start Reserve and Reliability Must Runs.

The head of Electricity of Viet Nam’s Market Management Department Tran Dang Khoa said that the new market participants needed to improve system security, flood control at hydro-power plants and the water supply for lowland rivers.

The vice general director of Da Nhim-Ham Thuan-Da Mi Hydro Power Corporation, Do Minh Loc, said that the corporation had four hydro-power plants in the Central Highlands which generated nearly 3 billion kWh last year, a much higher output than planned.

He said that good preparation before joining the market had allowed the company to flourish and record healthy profits and emphasised that it is vital for power plants to improve their information technology facilities, human resources and market studies to determine the best selling prices to offer the single buyer.

Viet Nam’s electricity market is planned to develop in three stages – a competitive power generation market (completed by 2014), a competitive wholesale market (2014-20) and a competitive retail market (after 2022)
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