| Author | Nguyen Mai Anh |
| Call Number | AIT Thesis no.ET-96-8 |
| Subject(s) | Electric utilities--Vietnam--Costs
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| Note | A thesis submitted in pa1tial fulfillment of the requirements for the degree of Master of Engineering. |
| Publisher | Asian Institute of Technology |
| Series Statement | Thesis ; no. ET-96-8 |
| Abstract | Independent Power Producers (IPPs) are a major source of new power generation capacity both in the industrialized and developing countries. They have a potential to meet large and immediate financing gap by mobilizing direct foreign investment in the power sector. Vietnamese Govenm1ent seeks to encourage private sector participation in power sector due to difficulty of financing investment needed to meet electricity demand. But lack of clear policies has delayed private participation considerably. Specially no policies have been set for the purchase of power from private sector. The study focuses on developing a methodology for computing a purchase price for Vietnam. It has been designed based on the concept of avoided cost. Long run differential revenue requirement (LRDRR) and hybrid approaches were used to calculate the avoided cost. But successful private power development will require that utility pay private developers an agreed-upon rate on their investment, a rate based on the true cost of generating power. Therefore a financial analysis was carried out to calculate the IPP's selling price that gives fair rate of return to independent power producer (IPP). Due to difficulty of getting true cost of power generation by IPP, hypothetical data based on literature review were used in the financial analysis. It is found that, the avoided cost at peak load was always higher than the value of purchase price that IPP required. It will give too high rate of return to IPP if utility use it as purclrnse price. The average avoided cost was varied from 2.9 cent/kWh to 5.0 cent/kWh corresponding with the IPP's energy supply and discount rate. The IPP's selling price which was calculated using financial analysis for IPP was close to the average avoided cost. It varied from 3.9 cent/kWh to 6.1 cent/kWh according to the variation of interest rate, share of equity and ex pected rate of return on equity ofIPP. In some cases, the IPP's selling price was higher than avoided cost. But in some cases, the avoided cost was higher than IPP's selling price. Therefore average avoided cost was appropriate method for utility to set up the purchase price electri city from IPP, but in order to get the final value for purchase price, it is needed to be negotiated detail for both parties. |
| Year | 1996 |
| Corresponding Series Added Entry | Asian Institute of Technology. Thesis ; no. ET-96-8 |
| Type | Thesis |
| School | School of Environment, Resources, and Development (SERD) |
| Department | Department of Energy and Climate Change (Former title: Department of Energy, Environment, and Climate Change (DEECC)) |
| Academic Program/FoS | Energy Technology (ET) |
| Chairperson(s) | Shrestha, R.M. |
| Examination Committee(s) | Shrestha, R.M.;Khang, Do Ba |
| Scholarship Donor(s) | Government of French |
| Degree | Thesis (M.Eng.) - Asian Institute of Technology, 1996 |