EVN reported a significant loss of VND16.8 trillion (US$789.6 million) in 2014, despite having increased retail electricity tariffs. — VNA/VNS Photo Ho Cau

HA NOI (Biz Hub) — The Ministry of Industry and Trade has asked Electricity of Viet Nam (EVN) to update power tariffs, based on input factors, following the group's proposal to raise electricity selling prices.

According to the ministry, the calculation for revised tariffs should be based on electricity tariffs for the period between August 1, 2013 and December 31, 2014.

The new proposed price should include inputs, which are not taken into account while calculating the current average tariff.

The ministry will co-operate with the relevant ministries and agencies to review updated information from the EVN and adjust power prices going forward.

The group's Deputy General Director Dinh Quang Tri said the adjustment would not be implemented before the Tet (Lunar New Year) Holiday.

EVN had earlier requested that the supplemental emerging costs be factored into power tariffs this year.

Deputy General Director Duong Quang Thanh told a press conference in Ha Noi that the group's business in 2014 would be reviewed and launched plans for 2015, saying the new inputs would include raising coal prices, gas and taxes on water, which have significantly affected its operations.

In addition, supplemental fees levied on the forest environment in 2011 and 2012 had driven up electricity production costs and have not been included in the current power prices.

It was for these reasons that EVN proposed to the Government that it should revise the state budget and Official Development Assistance (ODA) to complete power projects for rural and remote areas, while supplementing those costs into power tariffs.

EVN reported a significant loss of VND16.8 trillion (US$789.6 million) in 2014, despite having increased retail electricity tariffs.

Its revenue in 2014 was pegged at VND196.3 trillion ($9.3 billion), up 13 per cent over 2013. Also, after-tax profits last year were estimated to be VND300 billion ($14.2 million), while its return on equity (ROE) was 0.2 per cent. — VNS