Process for Adjusting the Average Retail Electricity Price Frame Today

The process for adjusting the average retail electricity price frame today is strictly established under Decree No. 72/2025/ND-CP and the Law on Electricity 2024, creating a transparent legal corridor for the energy market. Mastering this mechanism helps Vietnam Electricity (EVN) and electricity-consuming enterprises be proactive in financial planning. Long Phan Consulting Company analyzes this regulation in detail below.

Principles for adjusting the average retail electricity price.

According to Article 3, Decree No. 72/2025/ND-CP, the adjustment must strictly follow the principles of openness and transparency:

1. Annual Adjustment: Based on announced business costs of year N-2, the average retail price for year N is reviewed/adjusted based on objective input fluctuations (generation, transmission, distribution, system operation, auxiliary services) and allocation of uncalculated costs.
2. In-Year Adjustment: Based on updated generation costs and auxiliary service purchase costs.
3. Price Reduction: If the calculated price decreases by 1% or more, the electricity price is allowed to be adjusted downwards accordingly.
4. Price Increase: If the calculated price increases by 2% or more, the electricity price is allowed to be adjusted upwards.
5. Within the Frame: Adjustments must be within the price frame prescribed by the Prime Minister. If the calculated price falls outside the frame, it is only adjusted within the frame limits.
6. High Increase Reporting: If an adjustment of 10% or more is needed, the Ministry of Industry and Trade (MOIT) reports to the Prime Minister.

The current process for adjusting the average retail electricity price framework.

Decree No. 72/2025/ND-CP has decentralized the authority to determine specific electricity prices between Vietnam Electricity Group (EVN) and state management agencies. This process depends entirely on the percentage fluctuation of the calculated average retail electricity price compared to the current price to determine the competent authority for approval.

Adjustment process when average retail electricity prices decrease.

Decree No. 72/2025/ND-CP decentralizes the authority based on the fluctuation rate:

Price Reduction (Clause 1, Article 5):

• Condition: Calculated price decreases by 1% or more.
• Authority: EVN proactively adjusts the reduction (no prior permission needed).
• Reporting: EVN reports to MOIT within 05 working days for post-inspection.

Adjustment process when average retail electricity prices increase.

Price Increase (Clause 1, Article 5):

• Increase from 2% to < 5%: EVN decides. EVN reports to MOIT. Within 15 working days of receiving a complete dossier, MOIT gives a written opinion. After receiving the opinion, EVN can decide to adjust.
• Increase from 5% to < 10%: MOIT decides. EVN reports the price plan. MOIT reviews and responds within 15 working days. Adjustment is allowed only after MOIT’s written approval.
• Increase of 10% or more: Prime Minister decides. MOIT presides over inspection, consults relevant ministries (Finance, CMSC), reports to the Price Management Steering Committee, and submits to the Government for decision.

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Time and frequency of adjustments to the average retail electricity price.

Regulations regarding the timing and frequency of adjustments aim to reduce policy lags and ensure financial balance for the electricity sector, specifically as follows:

• Minimum Frequency: The minimum interval between two consecutive adjustments is 03 months.
• Review Time: Before the 25th day of the first month of Q2, Q3, and Q4, EVN is responsible for recalculating the average retail electricity price. (Legal Basis: Articles 6 and 8, Decree 72/2025/ND-CP).

Inspect and monitor adjustments to the average retail electricity price.

According to Article 7, Decree 72/2025/ND-CP:

• Authority: MOIT presides over inspecting EVN’s reports and price plans to ensure truthful data.
• Post-Inspection Mechanism: Strictly applied to EVN’s adjustment decisions. If errors are found, MOIT can request to stop or readjust the price immediately.
• Processing Time: EVN must implement the request within 05 working days.

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Long Phan Consulting Services provides consulting services on the process of adjusting average retail electricity prices.

Long Phan Consulting Company provides comprehensive legal solutions for energy enterprises and investors:

• Project Investment: Advising on procedures for renewable energy projects (wind, solar, biomass).
• PPA Advisory: Drafting/reviewing Power Purchase Agreements (PPA) with EVN.
• Dispute Resolution: Advising on complaints regarding electricity prices and metering.
• Compliance: Advising on electrical safety, electricity activity licenses, and participation in the competitive electricity market.
• Representation: Working with competent state agencies on behalf of clients.

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Some frequently asked questions about the process of adjusting the current average retail electricity price bracket.

Below are questions related to the process of adjusting the price range of the average retail electricity price:

When must EVN calculate the annual price?

Before January 25th of year N, based on the electricity supply plan and costs. (Legal Basis: Clause 1, Article 5, Decree 72/2025/ND-CP).

What are the basic input parameters in generation?

Fuel prices, foreign exchange rates, generation output structure, and electricity purchase costs in the market. (Legal Basis: Clause 7, Article 2, Decree 72/2025/ND-CP).

Is adjustment allowed if the increase is under 2%?

No. Price increase adjustment is only allowed when the calculated average retail price increases by 2% or more. (Legal Basis: Clause 4, Article 3, Decree 72/2025/ND-CP).

What does the price plan dossier include?

Report dispatch; cost calculation tables; calculation basis documents; cost norm explanations; explanations for uncalculated costs; and customer impact assessment report. (Legal Basis: Clause 2, Article 5, Decree 72/2025/ND-CP).

What is the average retail electricity price?

 It is the price determined based on the principle of calculating total production/business costs and average profit for 01 kWh of commercial electricity in each period. (Legal Basis: Clause 3, Article 2, Decree 72/2025/ND-CP).

Conclusion

Strict compliance with the Process for Adjusting the Average Retail Electricity Price Frame ensures market stability. Long Phan Consulting Company is ready to provide specialized advice on electricity laws. Please contact Hotline 1900636389 for timely support.