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Electricity market gets competitive   2010-07-21 - Viet Nam News

Electricity of Viet Nam (EVN) has been told to prepare information technology infrastructure suitable for the introduction of a competitive power generation market in Viet Nam.

Nhon Trach Power Plant No 1. (Photo: VNS)
Nhon Trach Power Plant No 1. (Photo: VNS)
A recent seminar in Ha Noi discussed the design, piloting and assessment of new IT infrastructure, due to be completed early next year. The total cost for the IT infrastructure necessary for a competitive power market was estimated at US$32 million, including a market interface system for generators.

The seminar was organised by EVN to look at the existing IT landscape and the overall information architecture in Viet Nam’s power generation market.

EVN deputy director Nguyen Manh Hung said the corporation had already developed a basic IT infrastructure and, from 2004, in anticipation of the creation of an official power market, had begun a process of upgrades and improvements.

This included the implementation of the VietPool Interim Market System, which managed market transactions; the development of hardware and software infrastructure for metering data acquisition, processing and storage and the upgrading of metering systems at EVN.

However, the National Electricity Dispatching Centre still lacked technological tools and methods to meet the regulations of a competitive power market, and the ability to plan the optimum operation of the electricity system in the short, medium and long term.

Such tools and methods were more necessary with the increasing number of new electricity plants coming into operation, Hung said.

Currently, the electricity system operated mostly on experience or embedded knowledge, which prevented the dispatching centre from operating an optimum business strategy or accurately forecasting supply and demand, thus affecting electricity security.

First step

EVN restructuring will start with power generation plants, EVN chairman Dao Van Hung told the press on Monday.

The corporation has proposed to the government a plan to begin its restructuring process, in which a pilot power generation company will be separated from EVN for independent operation. The company which will be initially supported by EVN in terms of finance and human resources, will invest in building several power generation plants.

If this company model is successfully implemented, EVN will continue to establish other independent bodies, Hung said.

Currently, EVN controls 47 per cent of current power generation capacity. The percentage would reduce to 40 per cent if Phu My thermo electricity plant completes its equitisation process by the end of this year, Hung said.

"In the general map for planning electricity development ratified by the Prime Minister, other co-operative projects will also be responsible for investing in electricity plants. Therefore, EVN will only account for 37 per cent of the nation’s electricity capacity by 2015 and will no longer hold a monopoly on the market, a situation that has existed since the 1990s," Hung said.

The absence of a comprehensive IT infrastructure also prevented the dispatching centre from providing electricity delivery centres with the information required to prepare corresponding operational plans, he said.

While domestic electricity plants had a monthly trading volume with EVN as high as VND4 trillion ($222.2 million), there was no monitoring system in place to determine whether they were actually operating efficiently.

The seminar discussed the key design criteria for the new infrastructure, database and information security considerations, the constraints, and recommendations from the consultant. Under the power market principles, all electricity plants with a capacity of more than 30MW have to join the competitive power generation market.

Hung expects the regulations on the competitive market to be completed by the end of this year.

According to the Electricity Law and the government regulations, the comparative generation power market will be piloted, assessed and completed in the 2006-14 period, the wholesale electricity buying market will be competitive in the 2015-22 period, and the electricity distribution market will have become competitive by 2022. The Vietnamese government in the past year has encouraged non-EVN investors to get involved in the electricity generation sector, providing financial incentives such as favourable loans, but very few investors have met the huge financial requirements. The power distribution sector is currently monopolised by EVN.

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