Decision No. 28/2014/QD-TTg dated April 07, 2014 of the Prime Minister on structure of electricity retail tariff

THE PRIME MINISTER

Decision No.28/2014/QD-TTg dated April 07, 2014 of the Prime Minister on structure of electricity retail tariff

Pursuant to the Law on organization of the Government dated December 25, 2001;

Pursuant to the Law on Electricity dated December 03, 2004; the Law amending and supplementing a number of the Law on Electricity dated November 20, 2012;

Pursuant to Decree No. 137/2013/ND-CP dated October 21, 2013 of the Government detailing the implementation of a number of articles of the Law on Electricity and the Law amending and supplementing a number of the Law on Electricity;

At the proposal of the Minister of Industry and Trade;

The Prime Minister issues the Decision regulating the structure of electricity retail tariff

Article 1. Scopes and objects of regulations

1. This Decision prescribes the structure of electricity retail tariff;

2. This Decision is applied to the Vietnam Electricity; the electricity Corporation under the Electricity of Vietnam; the electricity retailing unit purchasing electricity from the electricity Corporation under the Electricity of Vietnam; the electricity retailing unit in the rural, mountainous area, border, islands and areas without national power grid; organization and individuals using electricity;

Article 2. Term explainations

In this Decision, the below terms are construed as follows:

The structure of electricity retail tariff is the list of percentage (%) of the average price rate to calculate the specific retail price for each group of electricity customers;

Article 3. Principles of tariff formulation structure

1. The electricity retail price is regulated in detail for each group of electricity customers, including: production, business, administration and domestic activities;

2. The electricity retail price by voltage levels (from 110 kV or higher, from 22kV to less than 110kV, from 6 kV to less than 22 kV and 6 kV) applied to the groups of customer production of consumer groups, business, administrative and customers, including: production, business and administration.

3. The electricity retail price based on the time of electricity use for the purpose of production and business at voltage levels applied for qualified electricity customers;

4. The electricity retail price for groups of electricity customers includes 06 levels with gradually increasing price in order to encourage the saving and efficient use of electricity;

5. The electricity retail price with the use of prepayment meter shall be applied when the technical conditions are favourable for group of temporary and short-term electricity customers using electricity for domestic purposes.

6. Poor households based on the criteria specified by the Prime Minister are supported with electricity cost for domestic purposes; the monthly support level equivalent to the electricity bill for the use of 30 kWh calculated by the current electricity retail price of level 1;

7. The social policy households based on the criteria specified by the Prime Minister (not subject to poor households supported with electricity cost under the provisions in Clause 6 of this Article) and with the electricity volume used for domestic purpose in a month of no more than 50 kWh shall be supported with electricity cost equivalent to the cost of use of 30 kWh calculated by the current electricity retail price of level 1;

8. The funds for supporting the electricity cost for the poor households and social policy households are deducted from the State budget;

9. Application of electricity price in area of national grid connection for electricity customers in rural, mountainous areas, border and island without national power grid.

The difference of cost of electricity unit by applying the uniform electricity prices nationwide lower than the electricity business and production cost shall be included in the nationwide general electricity cost for the areas purchasing electricity from the Vietnam Electricity; for the areas not purchasing electricity from the Vietnam Electricity, the difference of cost shall comply with the Prime Minister’s regulations;

Article 4. Electricity retail tariff’s structure

1. Percentage (%) of electricity retail price for groups of electricity customers compared with the average electricity retail price is specified in detail in the Appendix attached to this Decision.

2. Where the structure of electricity consumption changes, based on the average electricity adjusted under the authority, the electricity retail price for groups of electricity may be adjusted within ± 2% compared with the percentage specified in the Appendix attached to this Decision.

3. The electricity retail price for electricity groups is determined on the basis of average electricity retail price adjusted under the authority and the structure of electricity retail tariff specified in Clause 1 and 2 of this Article;

Article 5. Implementation organization

1. The Ministry of Industry and Trade shall:

a) Regulate and guide the implementation of electricity retail price for groups of electricity customers and the electricity price for the electricity retailing units;

b) Study the formulation and request the Prime Minister to consider and approve:

- Mechanism of electricity price of 02 components including the power price and electricity price for groups of electricity groups when the technical conditions are favorable;

- Incentive mechanism of electricity price for pilot application for customers participating in the program of electricity demand management;

2. The Ministry of Labour - Invalids and Social Affairs shall assume the prime responsibility and coordinate with the Ministry of Finance, Trade and Ministry of Industry and Trade and the agencies concerned to formulate the criteria of social policy households entitled to the support under the provisions of Clause 7, Article 3 of this Decision for submission to the Prime Minister for consideration and decision no later than 3 months from the date of issue of this Decision.

3. The Ministry of Finance shall:

a) Assume the prime responsibility and coordinate with the Ministry of Industry and Trade, Ministry of Labor - Invalids and Social Affairs to calculate the annual support for the poor households and social policy households under the provisions in Clause 6, Clause 7 and Clause 8, Article 3 of this Decision for submission to the Prime Minister for consideration and decision;

b) Assume the prime responsibility and coordinate with the Ministry of Labor - Invalids and Social Affairs, the Ministry of Industry and Trade, to guide, inspect and supervise the support of electricity cost for the poor households and social policy households;

4. People’s Committee of provinces and centrally-affiliated cities shall organize the support of electricity cost for the poor households and social policy households;

Article 6. Effect

1. This Decision takes effect on June 01, 2014. The Decision No. 268/QD-TTg dated February 23, 2011 of the Prime Minister on the electricity retail tariff shall be invalid from the effective date of this Decision;

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, Chairman of People s Committees of provinces and centrally-affiliated cities, the Vietnam Electricity and the agencies concerned are liable to execute this Decision. /.

The Prime Minister

Nguyen Tan Dung

APPENDIX

STRUCTURE OF ELECTRICITY RETAIL PRICE
(Issued with the Decision No. 28/2014/QD-TTg dated April 07, 2014 of the Prime Minister)