The information stated in EVN's report implements the conclusion of the Government Inspectorate on compliance with policies and laws in management, implementation of planning, investment in construction of power projects according to Power Plan 7 and adjusted Power Plan 7.
Renegotiate electricity prices with investors
The inspection conclusion pointed out shortcomings and inadequacies in implementing electricity purchase prices for a number of hydropower projects, typically Dong Nai 2 hydropower plant of Trung Nam Hydropower Joint Stock Company, Song Bung 4 hydropower plant of Phu Thach My Joint Stock Company, Vung Ang 1 thermal power plant, etc.
Therefore, after having conclusions and related instructions, EVN said it has reviewed and reported to the Ministry of Industry and Trade to amend and supplement regulations related to fixed prices in electricity trading.
On that basis, EVN will handle the inspection conclusions for specific projects.
For Dong Nai 2 Hydropower Plant, EVN has directed the Electricity Trading Company (EPTC) to persistently negotiate electricity prices with the investor equal to the ceiling price in 2019 (the year of final settlement approval) for the entire project life from the date of commercial operation of VND 1,110/kWh.
The project investor has accepted the above electricity price and agreed to sign a revised and supplemented electricity purchase contract. The payment exceeding the price frame will be refunded to EVN by the investor, including interest for the remaining life of the project.
Thus, the existing problems with the Dong Nai 2 hydropower plant project have been basically resolved, causing no loss of money and assets to EVN.
In addition, EPTC also worked with the investor to select an auditing unit, conduct an audit of the total investment cost of the Dong Nai 2 hydropower plant project and report the negotiation results to EVN.
The parties also determined the difference in calculated revenue (calculated with the output in the electricity price plan) between the annual electricity price plan according to the negotiation results and the electricity price calculated using the price frame and reported to the Ministry of Industry and Trade.
Based on the average electricity price of 1,110 VND/kWh, the parties have calculated the annual electricity price, ensuring that the revenue difference determined as 1,512.26 billion VND has been calculated and offset against the electricity price of the remaining years of the project.
Identify the revenue difference of thousands of billions
Similarly, for the Song Bung 4A hydropower project, EPTC also worked with the investor to renegotiate the electricity price. Accordingly, the parties determined that the average fixed price for the entire project life is 922.67 VND/kWh, calculated from the date of commercial operation.
EVN also directed EPTC to determine the difference in revenue calculated between the annual electricity price plan according to the negotiation results and the electricity price calculated using the price frame. The determined revenue difference of VND 1,074.55 billion has been calculated to offset the electricity price of the remaining years of the project.
For the Vung Ang 1 thermal power project, EVN has requested the investor, the Vietnam Oil and Gas Power Corporation, to provide documents and files for the parties to review. At the same time, EVN also proposed to negotiate a reduction in the total investment to calculate the current electricity price and an agreement to adjust and reduce the current electricity price, as well as propose a temporary payment plan.
With the Dong Nai 5 hydropower project, the parties also negotiated the electricity price according to the final investment capital, reducing the fixed price compared to before by 45.48 VND/kWh, which is the basis for signing a revised contract on electricity purchase and sale with the plant.
According to the conclusion of the Government Inspectorate, at Dong Nai 2 Hydropower Plant, the Electricity Trading Company and Trung Nam Hydropower Joint Stock Company signed a power purchase contract with a provisional price of VND 1,740/kWh, VND 757/kWh higher than the ceiling price of the 2013 power generation price frame and approved by the Ministry of Industry and Trade.
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