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Power sector asked to help reduce housing costs

Update: August, 11/2016 - 11:30
A housing project developed by the HUD3 Investment and Construction JSC in the Vân Canh Urban Area in Hà Nội’s Hoài Đức District. Trillions of đồng has been invested in the housing projects in this area but few people come here to live, making them be left fallow for years. - Photo bizlive.vn
Viet Nam News

HCM CITY – The HCM City Real Estate Association on Wednesday asked the local Electricity of Việt Nam (EVN HCMC) branch to pay for building the electricity grid for projects being incurred by developers.

Chairman of the association Lê Hoàng Châu said that under the Electricity Law 2004 and the law supplementing and amending a number articles of the Electricity Law promulgated in 2012, power companies have the responsibility of building transformer stations and installing electricity meters for customers.

Under the Law on Real Estate Business issued in 2014, project investors must complete infrastructure facilities before handing over houses to their clients. 

Currently, property developers had to build all medium-voltage and low-voltage lines as well as transformer stations and connect power meters to the lines to distribute power to every apartment. On completion of the project, they had to pass on all the works to electricity companies without any payment, Châu said.

He added that funds invested in the system supplying power for housing projects often accounted for 1 per cent to 2 per cent of total project investments. As a result, home buyers would have to pay more.

“After the meeting with EVN HCMC, the association will send a document to the municipal People’s Committee and the Ministry of Industry and Trade, asking the electricity authorities to issue a payment mechanism applied for housing projects of which price is below VNĐ22 million ($982) per sq.m,” Châu said.

Deputy General Director of the EVN HCMC Phạm Quốc Bảo said the company acknowledged the situation and would report it to the EVN.

Bảo said power prices would probably be affected if the electricity sector had to develop a system to distribute power to every apartment in every housing project.

He said the sector might only accept paying the cost for projects of which profitability was ensured, meaning that people had to live there and consume electricity.

For high-priced projects, in which nobody lived and no power was consumed, it was hard for the sector to incur the cost.

A lawyer in HCM City said to thesaigontimes.vn that housing developers must complete all technical facilities, including electricity systems, within the scope of the project while power companies must supply electricity to the hedge of the projects and install power meters as requested by home buyers. – VNS

 

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