"At present we have redundant power supply, demand is expected to grow only 6-7 percent while generation capacity would rise 14-15 percent," Deputy Minister of Industry and Trade Bui Xuan Khu said in a report Friday.

Khu said the global economic downturn, especially in Japan, the US and Europe, Vietnam's key trading partners, has hurt export manufacturers.

Last year power demand, led by industry, jumped around 16 percent while supply only rose 12 percent, forcing the government to import electricity from China and rotate power outages in both Hanoi and Ho Chi Minh City.

Soaring demand also led top utility Electricity of Vietnam (EVN) to plan to invest $3 billion a year to build 33,200 MW of new generation capacity by 2015.

So far there has not been any delay in EVN power projects.

Reuters - january 5, 2009

Vietnam will not be short on power in 2009

Power shortage will not happen even in the dry season in 2009 and there will be temporary standby electricity, said general director of Electricity of Vietnam (EVN) Pham Le Thanh.

According to EVN, in order to prevent power shortage in 2009, the electricity sector is expected to post an increase of 13%. Namely, the country needs some 86.6 billion Kwh of electricity including 41.7 billion Kwh for the dry season.

Thanh noted that in the dry season of 2009, the north will not have new electricity source, hence, the group will have to transmit electricity from the south.

In order to prevent the power shortage even in the dry season of 2009, EVN will speed up operations of 15 electricity plants with the total capacity of about 15 billion Kwh, and kick off construction of four new electricity plants.

Additionally, in order to achieve the above target, in the New Year, EVN will carry out some financial measures. The group will sell a part of stake at some electricity plants such as Thac Ba, Pha Lai in a bid to ensure capital for some other plants, borrow capital from foreign organisations and invest more into projects. In 2009, EVN will establish an electricity trading company where the group will hold 30% of the capital and the remaining 70% of the capital will be contributed by individuals.

With the above feasible measures, EVN said that in 2009 the group's electricity will basically meet people's power demand and the power shortage will not happen even in the dry season and there will be a temporary standby power.

Pham Le Thanh said that in 2008 due to the impact of the world's economic crisis, EVN had to face various difficulties in electricity generation and trading.

In the first quarter of 2008, total volume of electricity products of the group rose by 19.8% of which electricity for the industrial sector increased by 24%. Nevertheless, by the fourth quarter of 2008, total electricity products rose by only 9% of which electricity for the industrial sector was up by only 3.78%. Especially, in December 2008, total electricity products grew by only 7.3% of which electricity for the industrial sector reduced by 2.3%.

Thanh said that as planned in 2008, the group had to ensure 77.2 billion Kwh of electricity of which the group generated 53 billion Kwh and bought 24 billion Kwh from outside. However, EVN fulfilled the targeted generation volume in 2008 but bought 20 billion Kwh from outside.

In 2008, EVN had to spend US$3 million on bonus and encouraging other partners to sell electricity to the group.

However, he added that although 2008 was an extremely difficult year for EVN, 2008 was the first year that the group posted electricity loss of below two digits, 9.26% by the end of 2008.

Thoi Bao Kinh Te Vietnam - January 5, 2009