EVN reform successful: chairman
Duong Quang Thanh, Chairman of the Electricity of Vietnam, speaks to Vietnam News Agency about his corporation’s restructuring plan from now till 2022.
* Will you please debrief us on the restructuring road map of the Electricity of Vietnam Group (EVN) in the period 2012-2015?
Restructuring was described as a political task and a matter of life or death for the EVN. By now I can say that we have gone in the right direction and completed all the key objectives for the restructuring proposal.
In the four years from 2012-2015, the EVN accomplished its plan to divest all capital investment in its non-core areas while reducing investment capital in all the seven joint stock companies.
In the period under review, all the five Electric Corporations under the EVN and the National Power Transmission Corporation (EVN NPT) successfully restructured their corporations.
What’s more important is that through out the restructuring process, the three Power General Corporations (GENCO) have been operating smoothly.
* The EVN will continue its restructuring process in the next five years. What will the main tasks be?
In the next five years, from 2016-2020, the EVN will focus its efforts to accomplish the following three main tasks. They are the equitisation of the three GENCOs; all EVN equitised enterprises must achieve the goal of high efficiency in their production and business; and the successful establishment of a competitive electricity market in the country – a very important factor for Vietnam to be placed 4th among ASEAN nations in electricity generation.
To achieve this goal, the EVN has laid down three main tasks as follows:
First, to focus on the task of organisational restructuring and ownership;
Second, to review and restructure of business lines within the EVN;
Third, to push up the restructuring process on enterprises management.
Among the three tasks, the first task is considered the core as it is the driving force behind improving production and business efficiency as well as labour productivity.
For this year - 2016, we’ll try to accomplish the equitisation of GENCO 3 and determine the value of GENCO 1 and 2 so that they can be equitised in 2017 and 2018 respectively.
For the Thuan Binh Wind Power Joint Stock Company, the EVN will remain an investor in the company.
Regarding the electric transmission bloc, the EVN will continue to hold 100 percent of its charter investment capita in the EVN NTP as at present. In the pipeline, the EVN is looking for measures to improve the financial capacity of the EVN NTP to upgrade its transmission capacity.
As from this year, the three GENCOs have separated the cost accounting between electricity distribution and retail price in all the three GENCOs. And also from this year, the management task of Power Purchase Agreement has been transferred to GENCOs from the EVN.
During the restructuring process, EVN has paid special attention to improving its rules and regulations on improving labour productivity and introducing the set of Key Performance Indicators – a base in the EVN salary reform.
* One of the corporation’s major tasks in the immediate future is to separate the maintenance work of the distribution grids from operation activity. Will you please further elaborate on this task?
This task will be done in all companies which are affiliated to the EVN. As we all know, in our daily operation, companies are depending on each other. For example, with the work of electricity generation, the EVN has piloted the establishment of the Northern Joint Stock Electric Service Company. This company’s task is to provide services for all power generation companies in the North. This company is put under the management of GENCO 3.
One of our other activities in the pipeline is to separate the maintenance work of the transmission grids from operation activity. We hope things run smoothly, the Northern Joint Stock Electric Service Company will become an independent unit from the EVN. In other words, it will become the EVN’s service partner.
I’m confident that the separation will help us to achieve the final goal of transparency of the inputs and outputs of power generation and consumption. This is a major step for the country to achieve the goal of having a competitive electricity retail market by 2022.
Restructuring was described as a political task and a matter of life or death for the EVN. By now I can say that we have gone in the right direction and completed all the key objectives for the restructuring proposal.
In the four years from 2012-2015, the EVN accomplished its plan to divest all capital investment in its non-core areas while reducing investment capital in all the seven joint stock companies.
In the period under review, all the five Electric Corporations under the EVN and the National Power Transmission Corporation (EVN NPT) successfully restructured their corporations.
What’s more important is that through out the restructuring process, the three Power General Corporations (GENCO) have been operating smoothly.
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| Duong Quang Thanh, Chairman of the Electricity of Vietnam |
In the next five years, from 2016-2020, the EVN will focus its efforts to accomplish the following three main tasks. They are the equitisation of the three GENCOs; all EVN equitised enterprises must achieve the goal of high efficiency in their production and business; and the successful establishment of a competitive electricity market in the country – a very important factor for Vietnam to be placed 4th among ASEAN nations in electricity generation.
To achieve this goal, the EVN has laid down three main tasks as follows:
First, to focus on the task of organisational restructuring and ownership;
Second, to review and restructure of business lines within the EVN;
Third, to push up the restructuring process on enterprises management.
Among the three tasks, the first task is considered the core as it is the driving force behind improving production and business efficiency as well as labour productivity.
For this year - 2016, we’ll try to accomplish the equitisation of GENCO 3 and determine the value of GENCO 1 and 2 so that they can be equitised in 2017 and 2018 respectively.
For the Thuan Binh Wind Power Joint Stock Company, the EVN will remain an investor in the company.
Regarding the electric transmission bloc, the EVN will continue to hold 100 percent of its charter investment capita in the EVN NTP as at present. In the pipeline, the EVN is looking for measures to improve the financial capacity of the EVN NTP to upgrade its transmission capacity.
As from this year, the three GENCOs have separated the cost accounting between electricity distribution and retail price in all the three GENCOs. And also from this year, the management task of Power Purchase Agreement has been transferred to GENCOs from the EVN.
During the restructuring process, EVN has paid special attention to improving its rules and regulations on improving labour productivity and introducing the set of Key Performance Indicators – a base in the EVN salary reform.
* One of the corporation’s major tasks in the immediate future is to separate the maintenance work of the distribution grids from operation activity. Will you please further elaborate on this task?
This task will be done in all companies which are affiliated to the EVN. As we all know, in our daily operation, companies are depending on each other. For example, with the work of electricity generation, the EVN has piloted the establishment of the Northern Joint Stock Electric Service Company. This company’s task is to provide services for all power generation companies in the North. This company is put under the management of GENCO 3.
One of our other activities in the pipeline is to separate the maintenance work of the transmission grids from operation activity. We hope things run smoothly, the Northern Joint Stock Electric Service Company will become an independent unit from the EVN. In other words, it will become the EVN’s service partner.
I’m confident that the separation will help us to achieve the final goal of transparency of the inputs and outputs of power generation and consumption. This is a major step for the country to achieve the goal of having a competitive electricity retail market by 2022.
