Retail electricity prices have been ratcheted up by 8.36% from Wednesday to VND1,850 (8 US cents) per kWh, excluding value-added tax.

EVN deputy general director Dinh Quang Tri

Deputy general director of EVN Dinh Quang Tri said coal prices have been raised by 2-7% so far this year. Meanwhile, EVN has to import more coal for power production as domestic sources fail to meet demand. This is forecasted to increase EVN’s power production costs by around VND5 trillion (USD217.39 million) this year.

EVN can only meet 45% of local electricity demand, while the group has to buy electricity from other sources for the remainder.

The exchange rate differences in power contracts have been partially been blamed for EVN’s higher costs. In 2017, EVN’s power production costs were raised by VND3.8 trillion because of the exchange rate differences.

This year, hydro-power plants are predicted to meet 30% of the domestic supply, while the rate of thermal-power plants will be 48-49% and renewable power will be 1.3%. But if water levels at reservoirs fail to meet demand, EVN will have to use diesel oil to produce some 1 billion kWh of electricity for the southern region.

According to Tri, Deloitte, KPMG and Ernst & Young have been hired to audit its EVN’s activities to ensure the transparency in the power price hike.