EVN reports record loss despite electricity price increases

VIETNAM, July 14 - HÀ NỘI — Although electricity prices were increased twice in 2023, Việt Nam Electricity (EVN) reported an after-tax loss of VNĐ26.77 trillion (US$1.053 billion) on high electricity production costs, according to its audited financial report.

In 2023, EVN reported revenues of around VNĐ500 trillion, up by 8 per cent over 2022. Of the figure, the revenue from selling electricity accounted for 99 per cent.

EVN must pay a total of VNĐ18.985 trillion worth of interest expenses last year, around VNĐ4 trillion higher than 2022, or more than VNĐ50 billion per day.

For 2022-23, EVN incurred a record loss of more than VNĐ47.5 trillion.

EVN said that in spite of the rises in the average electricity retail price, by 3 per cent on May 4 and 4.5 per cent on November 9, the increases could not make up for the rising electricity production costs, including higher fuel prices and rising foreign exchange rates.

The company also needed to increase electricity supply sources from thermoelectricity and renewable energies which had higher production costs than hydropower.

The EVN financial report triggers a worry that electricity prices might be increased further this year.

According to Nguyễn Thế Hữu, deputy director of the Electricity Regulatory Authority of Việt nam, before adjusting electricity prices, the Ministry of Industry and Trade must work with EVN to inspect and evaluate inputs' prices of electricity production as base for adjusting electricity prices. The evaluation is underway, he added.

Under the Prime Minister’s Decision No. 05/2024/QĐ-TTg which took effect from May 15, electricity prices are reviewed and adjusted every three months, instead of six months as previously.

When the input costs decrease by 1 per cent, the electricity prices will be decreased correspondingly. When input costs rise by 3 per cent or more, electricity prices will be increased. — VNS