Electricity prices in Vietnam are very low in comparison with other countries in the region, which has been leading to squandering power, officials said.

Low power prices blamed for inefficient energy use

Hoang Thai An, Chairman of Vietnam Electrical Engineering Association (VEEA), said that businesses and their investors do not pay enough attention to energy efficiency.

The low energy prices in Vietnam are accompanied by the worst efficiency rate in Southeast Asia, he said, adding that the amount of power that it takes to produce steel is one-fourth that of South Korea.

"The inefficient use of energy in the industrial sector could lead to serious consequences to commerce, and the country as a whole. If drastic measures are not taken, the supply of electricity may not meet the demand," An said.

According to An, industrial enterprises haven’t prioritised updating their technology.

He said that among 32 enterprises under the Vietnam Steel Association, only four have switched to up-to-date technology.

“Low power prices takes the pressure off producers to replace their old and inefficient equipment," said Tran Viet Ngai, Chairman of the Vietnam Energy Association.

Ngai added that several foreign investors have taken advantage of the low cost of electricity in Vietnam.

The slow increase in electricity prices, in comparison with other energy sources, has encouraged a great deal of households to switch electricity for their cooking and other needs, instead of using petroleum and gas. This adds to Vietnam's low efficiency rating.

The current Law on Electiricty has yet to clarify exact fines associated with energy squandering, according to An.

The Vietnam Electrotechnical Industry Association is conducting an energy efficiency audit among producers before compiling proposals to improve power savings via newer technology and more streamlined production, An shared.

Authorities in the electricity production and distribution sector would like to propose strict sanctions on waste, along with an increase in energy prices in order to provide market motivation towards better efficiency.

Source: Dtinews