The Memorandum of Understanding (MoU) signed by the US Department of the State Bureau of Energy Resources and the Electricity Regulatory Authority of Viet Nam in Ha Noi yesterday. — Photo nangluongvietnam

HA NOI (Biz Hub) — The US Department of the State Bureau of Energy Resources (ENR) will play a major role in developing Viet Nam's competitive power market.

According to a Memorandum of Understanding (MoU) signed by the ENR and the Electricity Regulatory Authority of Viet Nam (ERAV) in Ha Noi yesterday, the ENR will provide the technical support required for establishing Viet Nam competitive power market.

Underscoring the importance of the ENR's technical support, Principal Deputy Assistant Secretary Ambassador Warlick said establishing a competitive power market can "incentivise investments in new power generation and transmission projects, lower electricity costs, drive innovations in cleaner technology, and encourage conservation.

"The ENR and the Ministry of Industry and Trade (MOIT) share similar views on the importance of developing Viet Nam's competitive market. The cooperation between the ENR and MOIT will support a fair and transparent power market in Viet Nam in the future," deputy minister of trade Nguyen Cam Tu remarked.

He added that the ENR's technical support will take the bilateral partnership between the two countries to a higher level.

Expressing her amazement at the economic growth and development that Viet Nam achieved over the last decade, the US Embassy Deputy Chief of Mission Pierangelo noted that a country can expand only as much as its power supply allows.

She observed that Viet Nam needs reforms such as the establishment of a competitive power market that can ensure that the country's electricity supply can meet future demands.

ERAV's director general Nguyen Anh Tuan pointed out that a competitive power market will ensure fair competition, transparent prices, and efficient performance by Viet Nam's power companies.

According to Tuan, Viet Nam has been in the early stages of establishing a competitive power market, a reason why the country has to deal with less experience, poor infrastructure in the electricity sector, and a lack of qualified human resources.

The ministry has undertaken several studies and approved a road map for arket development. From 2010, it has allowed private investors to participate in the market in the form of Public-Private Partnerships.

It aims to build and start operating a wholesale competitive power market during 2015-20. A retail competitive power market will be built and operated by 2021. — VNS