This is among the key updates in the third draft of a decree amending and supplementing several provisions of Decree 72/2025/ND-CP on the mechanism and timing for adjusting the average retail electricity price.

Previously, the submission to the Government on the second draft of Decree 72 proposed allowing calculation and allocation into electricity prices of production and supply costs that had not been recovered in past periods.

Citing EVN’s report, the ministry said geopolitical factors pushed up power purchase costs in 2022–2023, causing severe difficulties and an accumulated loss of about VND 50.029 trillion (about USD 2.04 billion). By end-2024, the parent company still carried accumulated losses of about VND 44.792 trillion (about USD 1.83 billion), eroding state investment capital and failing to preserve state equity at the enterprise.

EVN petitioned to treat this accumulated loss as an allowable cost to be included in the average retail electricity price.

In addition, other costs not yet fully reflected in prices are proposed for allocation, including direct costs of power production and supply as determined in audited annual financial statements from 2022 onward.

Regarding the amendment to point g, clause 2, Article 4 of Decree 72 arising from EVN’s proposal to address accumulated losses from previous years, the Ministry of Finance asked the Ministry of Industry and Trade to review for compliance with pricing principles and regulations.

To resolve EVN’s financial difficulties and limit negative impacts on its finances, the Ministry of Finance recommended the Ministry of Industry and Trade study suitable mechanisms for adjusting the average retail electricity price.

It also requested EVN be directed to detail the loss items, separating those due to social welfare obligations from those due to business operations, with attention to losses from non-core investments (if any) and to losses arising from mandated sectoral support policies.

At the same time, EVN should assess the impact of price adjustments and propose measures to mitigate that impact.

“With sectoral oversight, the Ministry of Industry and Trade bears full responsibility for reviewing and verifying EVN’s reports and for supervising adjustments to EVN’s average retail electricity price,” the finance ministry noted in its comments.

According to the Vietnam Electricity Association, the draft does not clearly define costs arising from subjective factors or those beyond EVN’s control. For costs that occur over one, two, or three years, the draft does not specify how the average retail price should be adjusted once those factors subside.

In response to feedback from ministries, associations, and experts, the third draft reflects changes.

Specifically, the Ministry of Industry and Trade proposes two options to amend point g, clause 2, Article 4 of Decree 72. The focus is to allow allocation into the average retail price of allowable costs that were not fully captured previously.

Option 1: Direct costs of power production and supply that were not fully recovered in past average retail prices are determined based on the results of business operations (after deducting income from other activities, if any) in EVN’s audited standalone annual financial statements from 2022 onward.

Option 2: Direct costs of power production and supply that were not fully recovered in the average retail price from 2022 up to the effective date of this decree are determined based on the results of business operations (after deducting income from other activities, if any) in EVN’s audited standalone annual financial statements.

When implementing either option, the Ministry of Industry and Trade will review and opine on EVN’s proposed allocation plan for these costs.
According to the ministry, Option 1 applies broadly, allowing allocation of direct production and supply costs not fully reflected in the average retail price in 2022 and 2023, and continuing in subsequent years if similar situations recur.

This rule ensures proactive handling should challenges like those in 2022–2023 return.

However, many worry this could dampen cost-saving incentives at power units, since any cost overrun might be recouped through the average retail price.

Option 2 only addresses direct production and supply costs not fully reflected from 2022 until the decree takes effect, and does not apply in later years if similar circumstances emerge.

Under this approach, power units must tighten cost reviews and controls to avoid future losses.

The ministry stressed that the additional provision covers both electricity production-business results and related activities, which are a significant annual revenue source.

For example, in 2022 and 2023, EVN’s financial income was VND 12.070 trillion (about USD 493 million) and VND 14.982 trillion (about USD 611 million), respectively, substantially offsetting the gap between revenue and production cost. Without this income, the shortfall requiring compensation would have been larger.

According to the ministry, thanks to favorable hydrology in the first seven months of 2025, EVN’s business results are better than expected.

Therefore, if the rule to allocate losses into prices is added, year-end electricity prices would remain almost unchanged or rise only slightly by 2–5 percent. If prices rise 3 percent from October, the full-year consumer price index (CPI) would add only about 0.03 percentage points.