The Electricity Law states that the State holds a monopoly in power transmission. But Deputy Prime Minister Trinh Dinh Dung explained that this means a monopoly in management only, not investment.
Trung Nam Group
The Ministry of Industry and Trade (MOIT) has predicted that Vietnam will face an electricity shortage in 2019 and the peak will occur in 2021. Therefore, calling for investments in power transmission projects has become a burning issue.
National Assembly Deputies and members of the government had a long discussion on November 6-7 on whether to allow private investors to develop a power transmission network.
Vu Thi Luu Mai, member of the National Assembly’s Finance and Budget Committee, said MOIT needs to consider its support for the development of the 500 KV transmission line project registered by Trung Nam Group, because the Investment, Bidding and Power Laws do not allow private investment in the electricity transmission sector.
Minister of Industry and Trade Tran Tuan Anh explained that if private investors build a 500 KV line which connects a power generation project with the national grid, this will not be contrary to the current laws.
Anh also said that it is necessary to amend the relevant laws to pave the way for investors from different economic sectors to join the development of the power transmission sector.
Explaining problems which lead to the increasing risk of electricity shortage, Deputy Minister Trinh Dinh Dung said the biggest difficulty in calling for investments in the transmission sector is the provision in the Power Law that the State holds the monopoly in the sector.
|The Ministry of Industry and Trade (MOIT) has predicted that Vietnam will face an electricity shortage in 2019 and the peak will occur in 2021. Therefore, calling for investments in power transmission projects has become a burning issue.|
“However, the monopoly doesn’t mean the monopoly in investment, but just means monopoly in management,” he said, adding that private enterprises should be encouraged to invest in the transmission network and then transfer to the state for management. If so, the monopoly won’t exist.
Dung said that Vietnam will meet difficulties if only the State invests in transmission lines because of limited resources. From 2020, Vietnam would have more resources to develop the transmission network as more economic groups want to invest in the 500 KV transmission line. The government is considering the investment under the mode of BT (build, transfer)
Bac Lieu gas-fired power project
Nguyen Huy Thai, a National Assembly Deputy from Bac Lieu, has questioned why the Bac Lieu LNG-fired power project cannot be implemented, though the Prime Minister agreed in principle on the project 18 months ago.
Other National Assembly Deputies also commented that MOIT was ‘inactive’. Le Thanh Van, a member of the Finance and Budget Committee, asked the Prime Minister to urgently give instructions on the implementation of the project.
Private capital is the best solution for upgrading of power transmission lines, which have traditionally been funded by the state.