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  Policy & Strategy

National Assembly to appraise law to open up energy sector

The 16th session of the National Assembly's Standing Committee ended on Thursday after four days of debate chaired by assembly chairman Nguyen Van An.

Vice President Truong My Hoa and Deputy Prime Minister Pham Gia Khiem attended the session, which discussed draft legislation on subjects including electricity, animal health, crime detection, anti-dumping, national reserve and income tax.

The meeting also discussed avian flu, new school text books and the role of the National Assembly in foreign affairs.

The industry ministry on Monday submitted to the assembly a draft bill to introduce competition in the electricity sector .

"It is very important to build the legal framework that will pave the way for the establishment of the country's competitive electricity market," said industry minister Hoang Trung Hai.

The legislation would help attract investment in the energy sector and promote state-owned Electricity of Viet Nam's services and products, he said.

But committee members said the proposal failed to tackle several issues.

They said electricity was a commodity that was not stored, carried and circulated like other goods, and which played a crucial role in sustainable development, especially in industry.

They proposed that state-owned firms be allowed to hold a monopoly on power transmission while private companies, including foreign ones, could provide electricity generation and distribution.

Ho Duc Viet, head of the National Assembly's division on sciences, technology and environment, backed these proposals.

He said they would help generate capital to fund improvements to the country's energy sector.

The State should regulate the activities of the energy sector to ensure a stable, equitable and profitable supply of electricity.

State intervention should include control of electricity prices and measures to regulate demand and supply of the market, members said.

Hai said the industry ministry would appoint a temporary agency to regulate the energy market in the short term as it would take time to set up a permanent agency.

The draft law included a section on electricity prices, but some committee members said it failed to protect consumers as it permitted the power supplier to cut off customers who failed to pay a bill within 15 days, but did not fine a supplier which broke a contract with the customer.

After joining AFTA and WTO, Viet Nam may have higher electricity prices, resulting from higher production costs, they warned.

This would make Vietnamese commodities less competitive on world markets and make the investment environment less attractive, they said.

VNS - (08/03/2004)

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