VietnameseDecision No. 26/2006/QD-TTg dated January 26, 2006 of the Prime Minister approving the roadmap and conditions for formation and development of different levels of the electricity market in Vietnam
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Decision No. 26/2006/QD-TTg dated January 26, 2006 of the Prime Minister approving the roadmap and conditions for formation and development of different levels of the electricity market in Vietnam
| Issuing body: | Prime Minister | Effective date: | Known Please log in to a subscriber account to use this function. Don’t have an account? Register here |
| Official number: | 26/2006/QD-TTg | Signer: | Phan Van Khai |
| Type: | Decision | Expiry date: | Known Please log in to a subscriber account to use this function. Don’t have an account? Register here |
| Issuing date: | 26/01/2006 | Effect status: | Known Please log in to a subscriber account to use this function. Don’t have an account? Register here |
| Fields: | Electricity , Industry , Policy |
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THE PRIME MINISTER OF GOVERNMENT ------- | SOCIALIST REPUBLIC OF VIET NAM Independence - Freedom - Happiness ---------- |
No: 26/2006/QD-TTg | Hanoi, January 26, 2006 |
DECISION
APPROVING THE ROADMAP AND CONDITIONS FOR FORMATION AND DEVELOPMENT OF DIFFERENT LEVELS OF THE ELECTRICITY MARKET IN VIETNAM
THE PRIME MINISTER
Pursuant to the December 25, 2001 Law on Organization of the Government;
Pursuant to the December 3, 2004 Electricity Law;
At the proposal of the Minister of Industry,
DECIDES:
Article 1.-To approve the roadmap and conditions for formation and development of different levels of the electricity market in Vietnam with the following contents:
1. Purposes:
a/ To step by step develop a competitive electricity market in a stable manner, eliminate subsidy for the power industry, increase the electricity consumers' right to select electricity suppliers;
b/ To attract investment from all economic sectors inside and outside the country into electricity-related activities, gradually reduce the state investment in the power industry;
c/ To raise efficiency of production and business activities of the power industry, reduce the pressure of increasing electricity price;
d/ To ensure the stable and reliable supply of electricity with higher and higher quality;
e/ To ensure sustainable development of the power industry.
2. Roadmap for formation and development of different levels of the electricity market in Vietnam
Vietnam's electricity market shall be formed and developed through three levels:
- Level 1 (2005-2014): The competitive electricity production market.
- Level 2 (2015-2022): The competitive electricity wholesale market.
- Level 3 (after 2022): The competitive electricity retail market.
Each level shall be developed through two steps: experimentation and completion, specifically:
a/ Step 1 - level 1: The experimental competitive electricity production market (from 2005 to 2008).
- To form a competitive electricity production market for power plants of the Electricity of Vietnam (EVN) to compete in electricity production on an experimental basis after the model of sole purchaser. Power plants, power-transmitting companies and power-distributing companies of the EVN shall be reorganized into independent business cost-accounting companies.
- Independent power producers (IPP) not owned by the EVN shall continue selling electricity to the EVN under concluded long-term power purchase agreements (PPA).
- At the end of the experimental step, major power plants of the EVN, which play an important role in the power system, must be transformed into IPPs in form of independent state companies; the other power plants must be transformed into IPPs in form of joint-stock companies in preparation for a complete competitive electricity production market.
- The Ministry of Industry shall promulgate regulations to regulate operations of the market and guide the implementation thereof.
b/ Step 2 - level 1: The complete competitive electricity production market (from 2009 to 2014)
- To form a complete competitive electricity production market after prerequisites for this step have been met.
- To permit IPPs not owned by the EVN to participate in price offering in order to start the complete competitive electricity production market (after the sole-purchaser model); electricity producers shall sell electricity on the market through PPAs or competitive price offers on the spot market, provided that the amount of electricity sold in either of these two forms is regulated by the Electricity Regulation Department.
c/ Step 1 - level 2: The experimental competitive electricity wholesale market (from 2015 to 2016).
- To form an experimental competitive electricity wholesale market when prerequisites for this level have been met.
- To permit the selection of a number of major distributors and customers for establishment of the experimental competitive electricity wholesale market. To permit the establishment of a number of wholesalers in order to enhance the competitiveness in electricity wholesale. Current electricity-transmitting companies may be consolidated into a sole national electricity-transmitting company under the EVN; distributors, system operators and transaction administrators in the electricity market shall continue to be managed by the EVN.
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