Circular No. 11/2006/TT-BCN guiding the implementation of electricity selling prices

CIRCULAR

Guidelines for Implementing Electricity Sales Prices

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Pursuant to Decree No. 55/2003/NĐ-CP dated May 28, 2003 of the Government stipulating functions, tasks, powers, and organizational structure of the Ministry of Industry;t s Pursuant to the Electricity Law dated December 3, 2004; Decree No. 105/2005/NĐ-CP dated August 17, 2005 of the Government detailing and guiding the implementation of certain provisions of the Electricity Law;

Pursuant to Decision No. 276/2006/QĐ-TTg dated December 4, 2006 of the Prime Minister on electricity sales prices; Decision No. 45/2006/QĐ-BCN dated December 14, 2006 of the Minister of Industry on wholesale electricity prices for rural areas and wholesale electricity prices for residential complexes and clusters;

After reaching consensus with the Ministry of Finance, the Ministry of Industry provides guidelines for implementing electricity sales prices as follows:

1. This Circular guides the implementation of Decision No. 276/2006/QĐ-TTg of the Prime Minister on electricity sales prices (hereinafter referred to as Decision 276/2006/QĐ-TTg) and Decision No. 45/2006/QĐ-BCN dated December 14, 2006 of the Minister of Industry on wholesale electricity prices for rural areas and wholesale electricity prices for residential complexes and clusters (hereinafter referred to as Decision 45/2006/QĐ-BCN).

This technical regulation sets out technical requirements, testing methods, sampling procedures; management requirements; responsibilities of organizations and individuals producing, trading, and importing cigarettes.

2. Retail electricity prices specified in Clause a and Clause b, Article 3 of Decision 276/2006/QĐ-TTg and wholesale electricity prices for rural areas and wholesale electricity prices for residential complexes and clusters specified in Decision 45/2006/QĐ-BCN apply to entities that have signed direct electricity purchase and sale contracts with electricity selling units from the national power system. Electricity prices according to quality standards specified in Decree No. 105/2005/NĐ-CP dated August 17, 2005 of the Government detailing and guiding the implementation of certain provisions of the Electricity Law.

3. The signing of electricity purchase and sale contracts shall be carried out in accordance with the Electricity Law and other current regulations.

4. Electricity prices must be applied strictly in accordance with the intended users and purposes of electricity usage as guided in this Circular.

The electricity buyer is responsible for declaring the correct purpose of electricity usage to calculate electricity prices in accordance with this Circular.

If the electricity buyer changes the purpose of electricity usage leading to a change in price, they must notify the electricity seller at least 15 days in advance to adjust the pricing object in the contract. The electricity seller shall inspect and promptly apply electricity prices in accordance with the prescribed objects.

In cases where incorrect pricing objects are applied, causing losses to either the buyer or the seller, the overcharged or refunded electricity fees will be adjusted accordingly. If the time period of incorrect pricing cannot be determined, it will be calculated based on a 12-month period from the date of discovery.

When the electricity buyer uses electricity for multiple purposes with different prices, the electricity seller must install separate meters for each type of price; if separate meters cannot be installed, both parties shall base their agreement on the actual electricity usage situation to determine the specific proportion of electricity usage for each type of price and include it in the electricity purchase and sale contract.

5. When the electricity buyer uses electricity for multiple purposes with different prices, the electricity seller must install separate meters for each type of price; if separate meters cannot be installed, both parties shall base their agreement on the actual electricity usage situation to determine the specific proportion of electricity usage for each type of price and include it in the electricity purchase and sale contract.

6. In cases where the electricity buyer uses electricity during periods when the meter is missing or not functioning, the amount of electricity used shall be determined in accordance with Clause 3, Article 14 of Decree No. 105/2005/NĐ-CP of the Government and the Electricity Purchase and Sale Contract. The electricity price shall be applied according to the purpose of electricity usage recorded in the Electricity Purchase and Sale Contract. For those applying the three-tier pricing method, the electricity price is the average price of the three consecutive meter readings prior to the incident, and if there are fewer than three cycles, the normal hour rate shall apply.

7. Retail electricity prices sold directly by independent power producers to organizations and individuals using electricity shall be implemented in accordance with Point c, Article 3 of Decision 276/2006/QĐ-TTg.

8. In this Circular, the following terms are understood as follows:

a)The buyer of electricityrefers to organizations or individuals who have signed electricity purchase contracts with the electricity seller for direct use or resale to other organizations or individuals.

b)The seller of electricityrefers to units engaged in wholesale and retail electricity sales with permits for electricity business operations in the wholesale and retail sectors.

II. RETAIL ELECTRICITY PRICES BASED ON VOLTAGE LEVELS AND TIME OF USE DURING THE DAY

1. Electricity prices based on voltage levels

Retail electricity prices based on voltage levels as stipulated in Decision No. 276/2006/QĐ-TTg apply to all electricity buyers, except those purchasing electricity for residential use, wholesale electricity for rural areas, residential complexes, and clusters.

Electricity meters installed at a particular voltage level shall be charged according to the price specified at that voltage level.

2. Electricity prices based on time of use during the day

2.1. Electricity prices are defined based on the time of electricity use during the day (hereinafter referred to as the three-tier pricing method)a) Time of electricity use during the day for applying the three-tier pricing method is defined as follows:).

- Normal hours: from 04:00 to 18:00 (14 hours)

- Peak hours: from 18:00 to 22:00 (04 hours)- Off-peak hours: from 22:00 to 04:00 (06 hours))

until 04:00 the next morning.b) The three-tier pricing method applies to the following entities:)

- Electricity buyers using electricity for production, business, and services, supplied through dedicated transformers of 25 kVA or more, or with an average monthly electricity consumption of 2,000 kWh or more over three consecutive months;- Electricity buyers using electricity for irrigation purposes serving rice, vegetable, and short-cycle industrial crop cultivation.c) It is encouraged for electricity buyers using electricity for production, business, and service purposes with transformers and electricity consumption below the specified levels to adopt the three-tier pricing method.

The electricity seller has the responsibility to create conditions and guide the electricity buyer to install three-tier meters.

2.2. The electricity seller must prepare sufficient meters to install for electricity buyers subject to the three-tier pricing method. While the electricity seller does not have the conditions to install three-tier meters, the normal hour rate shall apply.

2.3. In cases where the electricity seller has the conditions to install three-tier meters and notifies the electricity buyer subject to mandatory application of the three-tier pricing method in writing about the plan for installing three-tier meters, the electricity buyer is responsible for cooperating with the electricity seller to implement the installation of three-tier meters.

c) Encourage the purchase of electricity under the three-tier pricing scheme for the Buyer who uses electricity for production and business services with transformers and consumption levels below the aforementioned threshold;

The Seller shall be responsible for creating conditions and providing guidance to enable the Buyer to install a three-tier meter;

2.2. The Seller must prepare sufficient meters for measuring electricity to be installed for Buyers subject to the three-tier pricing scheme. In cases where the Seller does not have the conditions to install a three-tier meter, the normal hourly pricing shall be applied;

2.3. In cases where the Seller has the conditions to install a three-tier meter and notifies in writing the Buyers who are required to apply the three-tier pricing scheme about the plan to install the three-tier meter, the Buyer shall be responsible for coordinating with the Seller to carry out the installation of the three-tier meter.

In the case where the Buyer of Electricity belongs to the category required to apply the three-tier pricing system but refuses to install a three-tier meter and has been notified by the Seller of Electricity three times, then fifteen days after the first notification, the Seller of Electricity may apply the peak hour electricity price for the entire amount of electricity consumed until the installation of the three-tier meter.

2.4. In the case where the Buyer of Electricity belongs to the category applying the three-tier pricing system and has organizations or individuals sharing a meter that do not belong to this category, the Seller of Electricity must separately install meters for these organizations and individuals as main accounts to sign direct electricity purchase and sale contracts.

If due to technical conditions, separate contracts cannot be established for organizations and individuals sharing a meter, the Seller of Electricity shall install three-tier meters for these organizations and individuals to deduct electricity consumption based on actual usage. In cases where three-tier meters cannot be installed for organizations and individuals sharing a meter, the normal hour electricity price will be applied.

Example The Buyer of Electricity is Factory A with a transformer capacity of 560 kVA, which falls under the category required to apply the three-tier pricing system, but includes organizations and individuals sharing a meter that do not fall under this category, including:

- Collective housing area of the factory using electricity for living purposes at the wholesale residential electricity rate.

- Vocational Training Center B applying the electricity rate for administrative and public service institutions.

These shared units will have three-tier meters installed for deduction, so the electricity volume priced according to daytime hours of Factory A will be calculated as follows:

Unit of measurement: kWh

III. RETAIL ELECTRICITY PRICES BY USE CATEGORY

1. Electricity prices for production

1.1. Electricity prices for production industries

Applied to all Buyers of Electricity for use in production in the following sectors:

- Industry (including steelmaking, ferroalloys, clindon; caustic soda, urea, apatite concentrate, yellow phosphorus production);

- Construction; Transportation; Mining; Forestry; Fisheries;

- Agriculture: crop cultivation (including electricity for irrigation of industrial crops, fruit trees in areas without water management fees, lighting to stimulate high-yield fruit trees); livestock breeding, fisheries, and other types of animal husbandry; production of plant protection and disease control chemicals;

- Water supply production (including electricity used at sales offices) for domestic consumption and business operations.

In the case where the Buyer of Electricity is an organization or individual producing clean water in villages and selling it to households, if they use electricity after the main meter, it will be calculated based on the other purpose rates of the wholesale electricity price for rural areas; if they use electricity under a separate contract, it will be calculated based on the production electricity price.

- Offices of groups, corporations, companies managing production and business operations;

- Warehouses for goods (finished products, semi-finished products) in the production process;

- Enterprises engaged in public welfare activities;

- Pumping stations for drainage, flood prevention, and wastewater treatment in cities and towns;

- Radio and telecommunications wave stations belonging to postal and telecommunications companies;

- Other production activities.

1.2. Electricity prices for irrigation pumps

Electricity prices for irrigation pumps apply to Buyers of Electricity using electricity for pumping water for irrigation to serve rice, vegetable, short-term cash crop cultivation (jute, rush, peanuts, soybeans...), seedlings, fruit trees, fruit tree seedlings with water management fees, including electricity used at offices responsible for managing and operating water conservancy works or Buyers of Electricity confirmed by water conservancy management agencies to use electricity for pumping water for irrigation to serve rice cultivation and short-term cash crop cultivation.

2. Electricity prices for administrative and public service institutions

2.1. Electricity prices for administrative and public service institutions

Electricity prices for administrative and public service institutions apply to the following Buyers of Electricity:

- Administrative state agencies; public service units; armed forces units; political organizations; political-social organizations; professional associations;

- Embassies, diplomatic missions, representative offices of international organizations (not involved in business management);

- Units operating in cultural, artistic, press, sports fields (including swimming pools, tennis courts...); radio and television stations; theaters, performance companies; film companies and cinemas, circuses, cultural centers, information centers, sports stadiums; museums, memorials, exhibition halls, funeral parlors, crematoriums;

- Parts of trade fairs, market management boards; parts of guesthouses and hotels managed by administrative agencies and public service units funded from the budget. The Buyer of Electricity must provide legal documents regarding the use of budget funds to determine pricing ratios;

Example Guesthouse A, a unit under a government agency, will have its electricity usage for the part of its operations funded by the government agency calculated based on the electricity price for administrative and public service institutions, while the commercial and service part of its operations will be calculated based on the commercial and service electricity price.

- Health insurance and social security agencies;

- Research, design, planning agencies; vocational training and educational institutions (excluding those mentioned in Point 2.2, Section 2, Part III of this Circular);

- Central and local book, newspaper publishing organizations (including stores), school equipment and medical equipment suppliers (including stores), foreign charitable organizations;

- Consulting firms (excluding those mentioned in Point 2.2, Section 2, Part III of this Circular);

- National reserve warehouses designated by authorized bodies, both within and outside the National Reserve Corporation;

- Non-profit social policy banks;

- Project management boards;

- Production activities of administrative agencies and public service units will be calculated based on the production electricity price; commercial and service activities of administrative agencies and public service units will be calculated based on the commercial and service electricity price.

2.2. Electricity prices for hospitals, kindergartens, primary schools

applicable to the following entities:

- Kindergartens, primary schools, secondary schools, general high schools, continuous education centers (for general education purposes), boarding schools for ethnic minorities of all types including public, semi-public, and private;

- Hospitals (including electricity consumption for funeral homes and medical waste incineration), healthcare facilities (including electricity consumption for preventive healthcare centers), rehabilitation centers, functional recovery centers, occupational disease treatment centers, drug rehabilitation counseling offices, HIV counseling offices, and family planning counseling offices;

These entities must have a decision on establishment or a business license from the competent authority. In cases where there is no such decision or license, they shall be charged at the commercial service rate.

2.3. Electricity selling price for public lighting

Applies to the Purchaser using electricity for public street lighting; parks; alleys; temples; churches; pagodas; historical sites that have been ranked; martyrs' cemeteries; collective residential areas or staircases in collective buildings; elevators in apartment complexes; water pumps serving daily activities in collective residential areas or community clusters.

3. Retail electricity selling price for household consumption with tiered pricing

3.1. The retail electricity selling price for household consumption with tiered pricing applies to households directly contracting with the Seller for electricity purchase.

Example of monthly electricity bill calculation:

Case 1: The Purchaser uses 60 kWh in a month.

The amount the Purchaser has to pay is 36,300 VND, including:

+ Electricity cost for 60 kWh x 550 VND/kWh = 33,000 VND

+ Value-added tax (10%) = 3,300 VND

Case 2: The Purchaser uses 500 kWh in a month.

The amount the Purchaser has to pay is 763,400 VND, including:

- First 100 kWh: 100 kWh x 550 VND/kWh = 55,000 VND

- Next 50 kWh: 50 kWh x 1,110 VND/kWh = 55,500 VND

- Next 50 kWh: 50 kWh x 1,470 VND/kWh = 73,500 VND

- Next 100 kWh: 100 kWh x 1,600 VND/kWh = 160,000 VND

Next 100 kWh: 100 kWh x 1,720 VND/kWh = 172,000 VND

- Next 100 kWh: 100 kWh x 1,780 VND/kWh = 178,000 VND

Total electricity cost = 694,000 VND

Value-added tax 10% = 69,400 VND

3.2. If the Purchaser has households sharing a meter (with separate household registration), they should request the Seller to install individual meters for each household to sign direct electricity purchase contracts.

While the Seller has not yet installed individual meters for each household, temporarily apply as follows: For Purchasers with less than 10 households using electricity in towns, townships, county seats, suburban areas of cities, and less than 15 households in urban areas of cities, the tiered pricing for household electricity consumption will be applied based on the maximum electricity consumption level of each tier in the electricity price table multiplied by the number of households sharing a meter.

Example For example, if the Purchaser has 4 households sharing a meter to purchase electricity, the tiered pricing for household electricity consumption would be calculated as follows:

- First 100 kWh x 4 households = 400 kWh at 550 VND/kWh

- Next 50 kWh x 4 households = 200 kWh at 1,110 VND/kWh

- Next 50 kWh x 4 households = 200 kWh at 1,470 VND/kWh

- Next 100 kWh x 4 households = 400 kWh at 1,600 VND/kWh

- Next 100 kWh x 4 households = 400 kWh at 1,720 VND/kWh

- From the 1,601st kWh onwards, charge at 1,780 VND/kWh

3.3. If the Purchaser has a single household with multiple electricity purchase contracts for household use (each contract with a separate meter) at one location, the total electricity consumption recorded on the meters at that location will be used to calculate the tiered pricing for household electricity consumption.

3.4. If the Purchaser signs a contract for electricity purchase for household use at the retail electricity price for household consumption and also engages in other activities (production, business...) using the same meter: if the monthly electricity consumption measured at the meter is less than or equal to 50 kWh per household (with separate household registration), then the tiered pricing for household electricity consumption will apply; if it exceeds 50 kWh per household, the electricity price will be calculated according to the usage purpose ratio specified in the contract.

ExampleFor example, if the Purchaser signs a contract for electricity purchase for household use at the retail electricity price for household consumption and also engages in production, business, and service activities using the same meter, the agreed ratio between household electricity, production electricity, and business electricity in the contract is 80%, 10%, and 10% respectively:

+ If the household uses 45 kWh in a month, then 100% of the electricity price for the first tier of 100 kWh at 550 VND/kWh will apply.

+ If the household uses 150 kWh in a month, the calculation will be as follows:

- Household electricity consumption at the tiered pricing for 120 kWh (150 kWh x 80%)

+ First 100 kWh at 550 VND/kWh

+ Next 20 kWh at 1,110 VND/kWh

- Production electricity consumption for 15 kWh (150 kWh x 10%)

- Business electricity consumption for 15 kWh (150 kWh x 10%)

3.5. Customers purchasing electricity through a separate transformer for household use will be charged according to the retail electricity price for household consumption with tiered pricing.

3.6. The signing of electricity purchase contracts for tenants using electricity for household purposes shall be carried out as follows:

a) At each rented address (based on the property ownership certificate of the landlord), the Seller will only sign one electricity purchase contract. The signing of the contract will be conducted among three parties: the Seller, the tenant who directly signs the rental contract or a representative of the tenants (in case multiple tenants sign the rental contract at the same location), and the landlord. In the event that the tenant fails to pay the electricity bill on time for any reason, the landlord is responsible for paying the electricity bill on behalf of the tenant.

b) In the case where there is already an electricity purchase and sale contract at the rented house address (signed by either the landlord or the previous tenant), the Electricity Seller shall only enter into a new electricity purchase and sale contract after terminating the existing electricity purchase and sale contract.

c) For students and workers renting houses for residence (with a lease term of twelve months or more) where the landlord is the Electricity Buyer who signs an electricity purchase and sale contract with the Electricity Seller, every four people (based on the temporary residence registration certificate and the rental agreement confirmed by the local authority) shall be considered as one household applying the tiered residential electricity tariff.

3.7. In cases of force majeure leading to the Electricity Seller having to shift the meter reading date, the usage quota for each tier of the residential electricity tariff shall be adjusted accordingly based on the number of days shifted.

4. Electricity selling price for business purposes

The electricity selling price for business purposes applies to entities using electricity for business and service purposes, including:

a) Enterprises, shops, supermarkets, commercial trading establishments dealing in wholesale and retail materials and goods, including pesticide, veterinary drug, seed, and livestock shops;

b) Financial institutions and securities organizations such as commercial banks, savings funds, financial companies, and securities companies;

c) Cable television and terrestrial digital television companies;

d) Lottery companies belonging to all economic sectors;

đ) Insurance organizations (excluding social insurance and health insurance);

e) Tourist facilities, photography shops, nightclubs, karaoke bars, massage parlors;

g) Food and beverage outlets, hair salons, laundry services, tailoring shops, car washing services;

h) Advertising activities (including advertising by television stations) according to the operational needs of production, business, and service establishments;

i) Repair and refurbishment shops for automobiles, motorcycles, transportation equipment, and consumer goods;

k) Hotels, guesthouses, hostels, and accommodation facilities of organizations and individuals; rented houses for residence or office use where the landlord has signed an electricity purchase contract;

l) Electricity used in ticket sales rooms, cargo handling stations, waiting rooms (including lobby areas) of stores and counters at airports, railway stations, bus terminals, and ports;

m) Electricity used at traffic toll stations and parking lots for automobiles;

n) Electricity used in warehouses during the circulation process;

o) Offices and headquarters of conglomerates, holding companies, and directly managed business and service companies;

p)  Offices and customer service centers;

q) Organizations and individuals using electricity both for production and business in the postal and telecommunications sector shall have their electricity purchase prices calculated as follows:

+ Postal services in Bac Kan, Cao Bang, Dien Bien, Dak Lak, Dak Nong, Gia Lai, Ha Giang, Ha Tinh, Kon Tum, Lang Son, Lao Cai, Lai Chau, Nghe An, Quang Binh, Quang Tri, Son La, Tuyen Quang, Thanh Hoa, and Yen Bai provinces:

* 97% of electricity consumption at the production price.

* 3% of electricity consumption at the business price.

+ Postal services in Ba Ria-Vung Tau, Dong Nai, Da Nang, Hanoi, Hai Phong, Ho Chi Minh City, and other postal and telecommunications businesses:

* 70% of electricity consumption at the production price.

* 30% of electricity consumption at the business price.

+ Postal services in remaining provinces, inter-provincial telecommunications companies, and the Stamp Company:

* 90% of electricity consumption at the production price.

* 10% of electricity consumption at the business price.

IV. ELECTRICITY SELLING PRICE FOR RURAL AREAS

1. Wholesale electricity selling price for rural areas

1.1. Wholesale electricity selling price for rural residential purposes

Applies to the quantity of electricity used for residential purposes by households purchasing electricity through a total meter installed at the transformer station, regardless of whether the transformer station belongs to the Electricity Buyer or the Electricity Seller, and irrespective of voltage level.

1.2. Wholesale electricity selling price for other purposes

Applies to the quantity of electricity used for purposes other than residential and irrigation water pumping for rice, vegetable, and short-cycle industrial crop cultivation.

1.3. The quantity of electricity calculated under each price category (residential, irrigation, other purposes) is determined from the electricity metering system installed at each transformer station.

1.4. In cases where there is no separate meter for each purpose of electricity use, the following applies:

a) The Electricity Buyer and the Electricity Seller shall base their determination of specific electricity usage ratios for each purpose on actual electricity usage conditions. The determination of electricity usage ratios for each purpose is as follows:

+ Before the tenth day of each month, the Electricity Buyer is responsible for providing the Electricity Seller with a list and the quantity of electricity sold directly to households for residential and other purposes in the previous month. Based on the provided list and the quantity of electricity sold directly according to usage purposes to electricity users in the previous month, the Electricity Seller and the Electricity Buyer will jointly determine the electricity usage ratio for each purpose to serve as the basis for setting the electricity selling price for the next month.

+ If the Electricity Buyer fails to provide the required list and quantity of electricity sold directly according to usage purposes (without a valid reason), the Electricity Seller has the right to calculate the electricity price based on the non-residential purpose rate for 100% of the sold electricity quantity.

+ In necessary cases and for households using over 100 kWh/month of residential electricity (as per the list provided by the Electricity Buyer), the Electricity Seller has the right and the Electricity Buyer has the responsibility to cooperate with the Electricity Seller to inspect electricity usage to ensure it is efficient and in accordance with intended purposes. If it is proven that electricity is being used beyond residential purposes (such as small-scale production or service provision), the Electricity Seller has the right to re-determine the electricity usage ratio for each purpose to ensure the wholesale electricity selling price accurately reflects the intended usage.

b. If the Electricity Buyer and the Electricity Seller cannot agree on specific electricity usage ratios for each purpose, they shall report to the provincial Industry Department for review and resolution. In necessary cases, the Industry Department will coordinate with the Finance Department to decide on specific electricity usage ratios for each price category to be included in the electricity purchase and sale contract.

1.5. The selling price of electricity applied to the quantity of electricity used for pumping water for irrigation serving rice production, vegetables, and short-cycle industrial crops intercropped at the meter ratio is the normal time electricity selling price for pumping water for irrigation.

1.6. In cases where the electricity buyer uses more than 50% of the electricity for other purposes (production, business...) from one meter, it shall be calculated according to the electricity selling price for production with corresponding voltage levels as stipulated in the Appendix attached to Decision No. 276/2006/QĐ-TTg, reduced by 10%.

Example 1: For electricity buyers with meters installed at substations with a voltage level of 6 kV, supplying residential electricity to 100 rural households accounting for 45% of the total volume, pumping water for irrigation accounting for 5% of the total volume, and electricity for other purposes accounting for 50% of the total volume, the prices are as follows:

+ 45% of the electricity volume is priced according to the wholesale price of rural residential electricity at 390 VND/kWh.

+ 5% of the electricity volume is priced according to the normal time price for pumping water at 600 VND/kWh.

+ 50% of the electricity volume is priced according to the production electricity selling price reduced by 10%, which is 774 VND/kWh (860 x 0.9 = 774).

Example 2: For electricity buyers with meters installed at substations with a voltage level of 6 kV, supplying residential electricity to 100 rural households accounting for 55% of the total volume, pumping water for irrigation accounting for 5% of the total volume, and electricity for other purposes accounting for 40% of the total volume, the prices are as follows:

+ 55% of the electricity volume is priced according to the wholesale price of rural residential electricity at 390 VND/kWh.

+ 5% of the electricity volume is priced according to the normal time price for pumping water at 600 VND/kWh.

+ 40% of the electricity volume is priced according to the electricity selling price for other purposes at 795 VND/kWh.

1.7. In cases where a substation has separate outgoing lines for different communes, cooperatives, villages, hamlets to enjoy the wholesale price, it is necessary to ensure that the meter measuring the total electricity at the substation is properly installed.

1.8. In cases where the substations of agricultural farms and forest farms supply electricity both to staff and workers of the agricultural and forest farms and to farmers along individual lines without being able to measure separately for each group, the pricing is as follows:

- The portion of electricity supplied to collective staff and workers is priced according to the wholesale price for collective areas, clusters of residents.

- The portion of electricity supplied to farmers is priced according to the wholesale price for rural residential electricity.

1.9. In cases where the substations of agricultural farms and forest farms supply electricity both to staff and workers of the agricultural and forest farms and to farmers living interspersed without being able to identify specific groups, the pricing is as follows: for residential electricity, it is priced according to the wholesale price for rural residential electricity; for electricity used for other purposes, it is priced according to the wholesale price for other purposes for collective areas and clusters of residents.

2. Retail electricity prices in rural areas

2.1. Retail electricity prices in rural, mountainous, and island areas are implemented according to the retail electricity price list prescribed in Decision No. 276/2006/QĐ-TTg and guided in Parts I, II, and III of this Circular, except for the cases specified in points 2.2 and 2.3 of this section.

2.2. The retail price of residential electricity in rural areas purchased through the national power system by organizations managing rural electricity is sold directly to electricity users in areas where investment and operation of power activities are not economically viable as defined by the Provincial People's Committee but must not exceed the ceiling price for residential electricity in rural areas as stipulated in Clause b, Article 3 of Decision No. 276/2006/QĐ-TTg.

The Provincial People's Committee is responsible for ensuring that power units operating in areas where investment and operation of power activities are not economically viable benefit from support policies as prescribed in the Electricity Law.

2.3. The retail price of electricity sold directly by independent power generation units to electricity users in rural, mountainous, and island areas is established and submitted for approval by the Provincial People's Committee but must not exceed the retail electricity price range prescribed in Clause c, Article 3 of Decision No. 276/2006/QĐ-TTg.

2.4. In areas where the retail price of residential electricity purchased through the national power system by organizations managing rural electricity to sell directly to electricity users is still higher than the ceiling price for residential electricity in rural areas as stipulated in Decision No. 276/2006/QĐ-TTg, the Provincial People's Committee directs relevant departments and organizations managing rural electricity to continue implementing necessary measures to reduce costs and losses in order to bring the electricity selling price below the ceiling price for residential electricity in rural areas.

V. PRICES FOR SELLING ELECTRICITY TO COLLECTIVE AREAS AND CLUSTERS OF RESIDENTS

1. Wholesale prices for electricity to collective areas and clusters of residents

1.1. The wholesale price of electricity for residential use in collective areas and clusters of residents applies to the quantity of electricity used for residential purposes by the following entities:

a) Clusters of residents, collective areas of agencies (including diplomatic agencies and international organizations), factories, plants, construction sites, agricultural farms, forest farms, stations, camps... where the electricity buyer includes ten households or more using electricity for: villages, hamlets, communes (not meeting the conditions for rural wholesale electricity); towns, townships, district capitals, outskirts of cities, and fifteen households or more using electricity for cities.

b) Collective housing for students, trainees, agency staff, factory workers, military forces, elderly care facilities, disabled people, orphanages...

c) Housing for religious practitioners at temples, pagodas, churches...

1.2. The wholesale price of electricity for other purposes applies to the amount of electricity used outside residential purposes.

1.3. The wholesale price of electricity for collective areas and clusters of residents only applies to places where the electricity seller does not yet have the conditions to sell directly to household consumers.

1.4. In places where the electricity seller has the conditions to sell directly to household consumers but the customers do not agree to allow the electricity seller to sell directly to household consumers, the electricity seller may apply the stepped retail price for residential electricity as guided in Section 3.2 of Part III of this Circular based on the actual number of households using electricity.

2. Retail prices for electricity to collective areas and clusters of residents

The retail price of electricity that organizations managing electricity (representing management boards of collective areas and clusters of residents or independent electricity management and trading organizations) sign contracts to purchase wholesale electricity from the electricity seller at the main meter according to the wholesale price for collective areas and clusters of residents to resell to electricity users is applied according to the retail electricity price list prescribed in Decision No. 276/2006/QĐ-TTg and guided in this Circular.

VI. PRICES FOR SELLING ELECTRICITY TO INDUSTRIAL ZONES

1. Wholesale prices for electricity to industrial zones

1.1. The purchase and sale price of electricity between the Industrial Zone Management Board and the Electricity Seller shall be agreed upon in the electricity purchase and sale contract with a term but shall not exceed the framework price for bulk electricity sales set by the Ministry of Industry.

In cases where there is no framework price for bulk electricity sales, the purchase and sale price of electricity between the Industrial Zone Management Board and the Electricity Seller shall be agreed upon by both parties on the principle of ensuring the legitimate interests of both parties.

1.2. The negotiation and agreement on the bulk electricity purchase and sale price shall be carried out in accordance with Article 20 of Decree No. 105/2005/NĐ-CP dated August 17, 2005, guiding the implementation of certain provisions of the Electricity Law.

1.3. While the Buyer and the Electricity Seller have not reached an agreement on the bulk electricity purchase and sale price, unless otherwise provided by competent authorities, the bulk electricity price for industrial zones shall be applied as follows:

a) The Electricity Seller sells to the Industrial Zone Management Board at the total meter according to the electricity selling price applicable to production sectors as stipulated in Decision No. 276/2006/QĐ-TTg, except when the Industrial Zone Management Board purchases electricity from the Electricity Seller and resells it to organizations and individuals using electricity for production purposes within the same industrial zone at the same voltage level.

b) In the case where the Industrial Zone Management Board purchases electricity from the Electricity Seller and resells it to organizations and individuals using electricity for production purposes within the same industrial zone at the same voltage level:

The Electricity Seller sells to the Industrial Zone Management Board at the total meter according to the electricity selling price applicable to production sectors as stipulated in Decision No. 276/2006/QĐ-TTg, reduced by 2%. The volume of electricity for calculating the reduced price is based on the actual monthly consumption of customers within the industrial zone purchasing at the same voltage level from the Industrial Zone Management Board.

Example : In the case where Industrial Zone Management Board A purchases electricity from the Electricity Seller at the 110 kV voltage level to resell to users for production purposes within the industrial zone:

- If Industrial Zone Management Board A sells electricity to production users within the industrial zone at the 6 kV voltage level:

The price that Industrial Zone Management Board A pays to the Electricity Seller is calculated as follows:

Industrial Zone Management Board A sells electricity to production users within the industrial zone at the 6 kV voltage level as follows:

- If Industrial Zone Management Board A sells electricity to production users within the industrial zone at the 110 kV voltage level:

The price that Industrial Zone Management Board A pays to the Electricity Seller is calculated as follows:

Industrial Zone Management Board A sells electricity to production users within the industrial zone at the 110 kV voltage level as follows:

2. Retail prices for customers using electricity in the industrial zone:

Retail prices for customers using electricity in the industrial zone shall be implemented in accordance with the prescribed categories and rates set forth in the Appendix attached to Decision No. 276/2006/QĐ-TTg and the guidance provided in Parts I, II, and III of this Circular.

VII. EFFECTIVE DATE OF IMPLEMENTATION

1. This Circular takes effect from January 1, 2007 (the date of effectiveness of Decision No. 276/2006/QĐ-TTg) and shall apply nationwide.

2. This Circular replaces Circular Joint Circular No. 01/1999/TT-LT/BVGCP-BCN dated February 10, 1999, Joint Circular No. 02/2000/TTLT-BVGCP-BCN dated February 15, 2000, issued by the Ministry of Industry and the Government Price Control Board regarding guidance on implementing residential electricity consumption prices in rural households, and Circular No. 01/2005/TT-BCN dated January 7, 2005, issued by the Ministry of Industry regarding guidance on implementing electricity selling prices.

3. Relevant power units and electricity consumers nationwide are responsible for implementing this Circular.

4. Any difficulties encountered during implementation should be reported to the Ministry of Industry for timely review and resolution./.