The Electricity of Viet Nam's Deputy Director General Nguyen Tan Loc told Nong thon Ngay nay (Countryside Today) newspaper about the company's investment plans and upgrades for remote and disadvantaged regions.
EVN started to sell electricity directly to people living in rural areas in mid 2008. By late 2010 the project was basically completed. Do you think the project was a success?
Yes, I do. The project received strong support from both authorities and local communities.
By buying directly from EVN, people living in rural areas can save quite a lot of money – they pay at least two to four times less than they would if they used a middleman or a co-ordinating organisation.
Of course there are several reasons behind the low cost. First, households don't have to pay the management fee or maintenance cost when they want to connect to the national grid.
Another important factor I must mention is the stable voltage of the electricity supply. These are good conditions for farmers to expand their production if they choose so.
What about the communes that fell under the purview of the Rural Electricity (RE) II project with funding from the World Bank?
EVN has now sold electricity directly to 7,311 communes, accounting for some 82 per cent of the communes with electric lighting. There are now about 1,642 communes that have still not bought electricity directly from us, including 939 communes in the RE II.
EVN has instructed its affiliated electric companies to take over the management and operation of these communes when these projects come to an end.
In addition, we make it possible for any rural electricity management unit or organisation to terminate contracts with their clients and transfer the job to us if they wish to. Of course, a proper deal must be negotiated.
What are the difficulties associated with managing extensive low voltage electricity networks?
No doubt, there are many problems we have to resolve. We maintain more than ten thousand kilometres of low voltage lines, with more than 5 million of our new clients living in rural areas. It also means that loss of electricity is higher during transmission. A huge investment would be required from EVN – up to tens of billions of dong – to rehabilitate and upgrade the low voltage lines, plus the increase in staff to manage the lines.
Is it true that the old low voltage lines are the root cause of losses during transmission?
The majority of these lines were put up about 20-30 years ago. They are obsolete and unsafe. So are the electric meters. I can say that, on average, the loss is about 20 per cent. In some localities it is between 40-45 per cent. So yes, low voltage lines are one of the main causes of transmission loss and make it hard to keep the network safe.
What is EVN's plan for this year?
At present EVN is implementing three projects with a total investment capital of US$ 750 million. The first is to improve the efficiency of the rural distribution network over a three-year period (2011-13), with a 120 million euro loan from a German government-owned development bank.
The project would be implemented in nearly 1,400 communes in 26 provinces. The second project also focuses on the efficiency of electricity distribution using $389 million borrowed from the World Bank.
Finally, the third one focuses on the development of renewable energy and improving the electric network for remote communes. This $151-million project is funded by the Asian Development Bank, and its beneficiaries would be about 500,000 households in some 1,000 remote communes in southern and central Viet Nam. Most of the beneficiaries are ethnic minorities. — VNS