Bearing the loss of nearly 45,000 billion VND of EVN, will electricity prices increase?

People worry about rising electricity prices...

Mr. Phung The Anh (Bach Khoa ward, Hanoi ) expressed: " Electricity prices have just increased for more than 3 months (from May 10). Because my family does business, the average electricity bill per month is 8 - 10 million VND, an increase of about 30% compared to before. This is not a small expense.

Therefore, I am very worried when the Ministry of Industry and Trade proposed that the Government allow the calculation of EVN's accumulated loss of more than VND 44,700 billion into the average retail electricity price. This could cause electricity prices to continue to increase. In difficult business times like now, every additional dong in costs can make business more difficult."

Meanwhile, Mr. Khau Hai Nam, leader of a food business in Chuong My ward (Hanoi), said that on average, the business spends about 600 - 800 million VND per month on electricity, equivalent to 2% of production and business costs. If the electricity price increases in the near future, this expense will "bulge", while the consumption market remains the same.

" This can directly affect the business's revenue and the workers' income. We have to worry about how to balance it in order to retain our staff, " said Mr. Nam.

People worry that their electricity bills will increase as they bear EVN's losses. (Illustration photo: EVN).

From his business perspective, Mr. Nam said that EVN is a special type of business. The main purpose is EVN's contribution to the country's socio -economic development.

Therefore, EVN's business performance should not be measured by profit or loss like other enterprises. Sometimes EVN makes a loss but the value the enterprise brings to the economy is large. Therefore, the loss is not necessarily the most important thing.

According to Mr. Nam, if the loss of nearly 45,000 billion VND as mentioned by EVN is divided by the total annual electricity consumption nationwide of about 300 billion kWh, each kWh of electricity consumed will bear about 150 VND. If the State agency spreads the above loss over many years, the amount of loss for each kWh of electricity will be lower.

"Prices will not spike"

In response to people's concerns, Mr. Ho Sy Quang - Deputy Head of Electricity Price Management Department, Electricity Department - Ministry of Industry and Trade, said that the increase in electricity prices will be moderate, within EVN's authority to adjust electricity prices, and there will be no sudden increase.

This is to ensure the Prime Minister's directive to manage electricity prices in a way that avoids "jerky" behavior, ensures harmonious benefits and is consistent with socio-economic development goals, while remaining within the inflation threshold approved by the National Assembly.

Mr. Quang also explained: EVN's loss of more than VND 44,000 billion was made public in 2023 - 2024, through audit reports and announcements of production and business results. In fact, this period was heavily affected by geopolitical factors: the Russia - Ukraine conflict broke out, input fuel prices for electricity production increased dramatically, imported oil and coal prices increased very high, at times the price of imported coal increased to 350 - 400 USD/ton.

Meanwhile, to stabilize the economy while it is affected by the COVID-19 pandemic, the retail electricity price in 2022 needs to remain the same. That can be seen, on the one hand, input costs increased sharply, while output did not adjust in time, leading to difficulties for EVN. This situation will not only occur in 2022 but will also last into 2023.

Following the Government's direction, electricity prices were adjusted at a "moderate" level, without sudden, shocking increases, in order to support businesses and the economy. However, in the context of coal and fuel prices remaining high, the failure to promptly adjust electricity prices has caused EVN's losses to grow larger. This is a clear reality, but has not been handled in a timely manner.

Therefore, Mr. Quang believes that if this loss is not handled, the group's capital, which is the State capital, will be directly affected. When there is no profit, EVN cannot accumulate to reinvest in power projects, thereby affecting national energy security.

" EVN's losses need to be handled through a mechanism to correctly and fully calculate reasonable electricity production costs, but they have not been accounted for and recovered at the right time. This recovery should have been carried out in the 2023-2024 period, but EVN has not yet implemented it ," said Mr. Quang.

Mr. Quang admitted that including these costs in electricity prices will more or less create certain impacts. However, according to regulations, how to include them, how to allocate them, and when to choose them must be carefully calculated by EVN and coordinated with competent authorities, including the General Statistics Office - Ministry of Finance, to assess the overall impacts.

The entire loss of more than VND44,000 billion may not be included in the electricity price immediately. EVN and the State management agency will have a reasonable allocation plan to minimize the negative impact on the economy as well as people's lives.

Experts and managers believe that compensating for business losses in the average electricity price will not significantly increase monthly bills. (Photo: EVN).

Meanwhile, according to Dr. Vo Tri Thanh, former Deputy Director of the Central Institute for Economic Management Research, Director of the Institute for Brand and Competition Strategy Research, electricity prices must be implemented according to the following principles: ensuring compensation for production costs; calculating correctly and fully reasonable and valid costs along with the necessary profit level for reproduction and complying with legal regulations.

“If due to the subjectivity of the enterprise, poor business performance causes losses in production and business activities, the enterprise shall take responsibility. In cases where, for the sake of socio-economic interests, the State is forced to keep electricity prices lower than costs and prices, leading to business losses and the enterprise cannot preserve State capital, there must be appropriate solutions.

Handling this cash flow deficit caused by prices by gradually allocating it to electricity prices is not contrary to the principles of electricity price formation, is not inconsistent with the Electricity Law, and is not contrary to Clause 7, Article 4 of the 2023 Price Law, which stipulates that "Price formation factors include the entire actual cost, profit (if any) or loss (if any) of financial obligations as prescribed by law", Mr. Thanh said.

On the contrary, there are also many opinions that this is not the right time to increase electricity prices, especially to calculate old losses into the price.

Despite positive economic signals in the first half of the year, Vietnam’s economy still faces many risks in the remaining period of 2025, especially new US tariffs. High electricity prices will increase input costs for businesses that are already facing many difficulties, affecting the living standards and incomes of workers.

According to experts, this loss arose from previous years and is not included in the 2025 business plan, so it is not advisable to simply transfer all of this loss to the electricity price, but if there is any, only a reasonable portion should be calculated.

In addition, comprehensive reform is needed so that EVN can operate more stably and sustainably, instead of "counting losses into prices".

The Ministry of Industry and Trade has just completed the Draft Decree amending and supplementing a number of articles of Decree 72/2025/ND-CP dated March 28, 2025 of the Government on the mechanism and time for adjusting the average retail electricity price, along with the Submission to seek opinions from relevant ministries, branches and units before submitting it to the Government for consideration.
In particular, the most notable content is that EVN recommends that Decree No. 72 should be amended and supplemented to allow the recovery of direct costs for electricity production and supply that have not been calculated and fully compensated in the previous average retail electricity price based on the results of the announcement of electricity production and business costs or annual audited financial statements.
According to EVN's report, due to the impact of the global geopolitical situation, the high cost of purchasing electricity in the period of 2022 - 2023 led to many difficulties in EVN's production and business activities, the accumulated loss of these 2 years was about 50,029 billion VND. By the end of 2024, the accumulated loss of the parent company - EVN was still about 44,792 billion VND.
This leads to a decrease in State investment capital in EVN, which cannot preserve State investment capital in the enterprise. Therefore, if it is not calculated to recover in the electricity price, it will not be able to compensate in time for the decrease in State investment capital in the previous years.
Therefore, EVN proposed the Minister of Industry and Trade to report to the Prime Minister for permission to calculate this accumulated loss as an expense allowed to be included in the average retail electricity price.

PHAM DUY

Source: https://vtcnews.vn/ganh-khoan-lo-gan-45-000-ty-dong-cua-evn-gia-dien-co-tang-ar961234.html