New electricity rates 8.9 percent higher

Hanoi (VNA) - New market-based electricity rates signed by Prime Minister Nguyen Tan Dung will take effect on March 1 this year.

Decision 21/2009/QD-TTg states that retail sales prices of electricity, excluding
value added tax, will average 948.5 VND/kWh, up 8.92 percent over 2008.

Poor households and low-income families will be subsidised by the State.

This year, 35-40 percent of the prices for the first 1-50kWh used for daily life
will be subsided. Households consuming from 51-100kWh will be charged at the average
price. These prices will be applied to all consumers who use power from the national
grid.

Rural power traders who could not sell electricity at the new prices due to their
conditions will be allowed to maintain their current prices of 700VND/kWh until
September this year.

Retail prices in areas still not linked to the national grid will be decided on by
provincial people's committees after submitting to the Ministry of Industry and
Trade.

From 2010, ceiling prices will gradually be applied to production and service
sectors. This will allow electricity companies to sell power at negotiated prices
below the ceiling prices under the guidance of the electricity regulator.

The Ministry of Industry and Trade in collaboration with the Ministry of Finance
will adjust the power price every year based on the market.

The Industry and Trade Minister will approve prices that change less than 5 percent
from the average passed for the previous year. If the adjusted level is 5 percent or
higher, it will be approved by the Prime Minister.-
Enditem