The state-owned utility Electricity Vietnam (EVN) raised its average retail electricity price by three per cent in a move that could put more pressure on businesses amid a slowing economic activity.
Local newspaper Cong Thuong (Industry and Trade News) reported on Thursday.
The average price was raised to 1,920.4 dong (0.081 dollars) per kilowatt hour, excluding value-added tax, the government said in a statement.
EVN made losses of 36.29 trillion dong, (1.5 billion dollars) in 2022 due to a year-on-year increase of 9.27 per cent in electricity production costs, according to the Ministry of Industry and Trade.
The country’s sole electricity distributor said that if the average retail electricity price was kept unchanged, its losses would extend to 64 trillion dong (2.7 billion dollars) this year due to the weakening of the dong currency, increased input costs for coal-fired power production, and rising renewable energy prices.
The hike in electricity prices was expected to raise the production costs of manufacturing companies, which had taken a hit to their revenue on a global economic slowdown, businesses said.
Higher electricity prices would add to the difficulties faced by garment makers, who have already struggled with rising raw material prices and a decline in export orders.
Pham Xuan Hong, chairman of the Ho Chi Minh City Textile and Garment, Embroidery Association, told local newspaper Tuoi Tre.
The move to lift the retail electricity price for the first time since 2019 has also raised concerns over inflation as the Southeast Asian country is trying to keep the consumer price index close to the target of 4.5 per cent for the year.
