The Ministry of Industry and Trade recently approved a pricing framework for importing electricity from Laos to Vietnam, which is set to take effect on December 31, 2025.

The new framework, which was announced on October 8 and signed by Deputy Minister Truong Thanh Hoai, outlines a new pricing scheme for both hydropower and wind power plants.

The new pricing scheme sets the maximum price for hydropower at $0.0678 per kWh while that for wind power is $0.064 per kWh.

The framework will be in place for five years starting December 31, 2025.

Under this framework, Vietnam Electricity (EVN) and electricity generation companies will negotiate prices based on shared benefits and risks with the goal of maximizing cost cutting in power generation and remaining competitive against domestic electricity prices.

The pricing framework was developed, in part, by EVN at the request of the Ministry of Industry and trade.

EVN has assigned Electric Power Trading Company (EPTC) to carry out the task.

The Ministry of Industry and Trade also tasked EVN with monitoring the implementation of the new pricing framework and reporting any significant fluctuations in parameters that might affect electricity imports.

EPTC proposed a price cap for electricity imports from Laos at $0.064 cents per kWh for power plants prior to December 31, 2025.

However, due to the variable nature of wind power generation, EPTC recommended that the ceiling price be adjusted based on a projected average investment reduction of 3.46 percent per year.

As a result, the ceiling import price for wind power plants will be set at $0.0551 per kWh starting December 31, 2025.

In May 2024, EVN submitted proposals for additional pricing options for imported electricity from Laos, which called for pricing to be set at either $0.0551 and $0.064 cents per kWh

The ministry also recently proposed a new price cap for purchasing electricity from hydroelectric projects at $0.678 per kWh, down from the current rate of $0.06.95.

Wind power prices are also being adjusted to $0.064 per kWh from the previous rate of $0.0695 cents per kWh.

At present, several wind power projects in Laos are awaiting approval to export electricity to Vietnam, with the most prominent being the Truong Son 2 Wind Power Plant, which has a capacity of 350 MW.

Electricity from this project will be imported via the 220kV double-circuit transmission line connecting the Truong Son and Do Lu wind power plants.

Additionally, the Monsoon Wind Power Plant, which has a capacity of 600 MW, is expected to start commercial operations in the second quarter of 2025.

The ongoing construction of the Monsoon - Thanh My transmission line and Dak Ooc switching station is anticipated to be completed by the end of this year, enabling the transmission of energy from both the Monsoon Wind Power Plant and other hydropower sources in Laos to Vietnam.

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