A fishy deal: VN imports electricity for itself from China, but invests in hydropower plants in Cambodia and Laos instead

03/05/2007
Gov’t to remove energy monopoly, subsidies: minister

"In the immediate time, we plan to import electricity from China, make investment in hydropower plants in Laos and Cambodia, which will transmit electricity to Vietnam" - Vietnam Minister of Industry Hoang Trung Hai

VietNamNet Bridge - The Ministry of Industry (MoI) has submitted to the Prime Minister the national energy strategy by 2020 with the vision until 2050, which identifies the removal of monopoly and subsidisation as the key solution to the energy balance in the future.

Minister of Industry Hoang Trung Hai talked more about the strategy.

What has Vietnam been doing to ensure energy balance in current conditions?

Currently, we are exploiting and using primary types of energy, including coal, oil and gas, and hydropower. The 1991-2005 period witnessed the growth rate of 12.7% in the use of primary types of energy, and the figure is expected to increase to 47.5-49.5mil TOE by 2010.

What we have to do is to gradually decrease the use of primary types of energy, while trying to discover new kinds of re-creatable energy, including nuclear power, wind, solar energy and geothermic energy, in order to diversify energy supplies. In addition, these kinds of energy will help provide power for remote areas, where electricity transmission networks cannot reach.

In the immediate time, we plan to import electricity from China, make investment in hydropower plants in Laos and Cambodia, which will transmit electricity to Vietnam. We are also considering importing coal to run power generators, importing crude oil to make products for domestic consumption. These measures will help satisfy the demand for energy.

In terms of policies, the Government agrees to call for investment in the energy sector from all different economic sectors. The Government will gradually remove the monopoly on and subsidisation of power development, and apply a suitable pricing policy to encourage safe and economical use of energy. The suitable policies and steps will lead to the establishment of a competitive market for energy.

You have mentioned the need to have suitable policies to develop a competitive energy market. Could you please give more details about the issue? Which difficulties will we face in ensuring an energy balance?

The investment capital for the energy sector will be a big challenge. There will be two problems: first, how to get enough capital for power development which can meet the demand for development, and second, power pricing.

We have to satisfy the demand for energy for production and household consumption. Only by doing this can we ensure the sustainable development of the economy, thus successfully attracting foreign investors.

In order to reach that end investment in the power sector must bring suitable profit to investors, which means that power pricing should be reasonable to stimulate investment, which will help provide enough power to the national economy.

An unsuitable pricing policy will not encourage people to invest in the energy sector, which also means that the national economy will not have enough energy to run on.

(Source: Lao dong (Hanoi))