Vietnam Plans to Split National Power Transmission Corporation from Vietnam Electricity to Boost Market Competition

Key summary

The Ministry of Industry and Trade in Vietnam is preparing a major restructuring of the country's power sector. The plan involves separating the National Power Transmission Corporation (NPT) from Vietnam Electricity (EVN), a state-owned utility, and transferring it to an agency under the ministry. This move aims to promote competition in the electricity market and improve management efficiency. Mr. Bui Quoc Hung, Deputy Head of the Electricity Authority of Vietnam, stated at a press conference on October 7, 2026, that the goal is to clearly separate generation, transmission, distribution, and retail businesses. The separation distinguishes naturally monopolistic activities from those open to competition. Overlapping investments in transmission and distribution networks face land use and infrastructure constraints and may lead to uneconomical costs. Generation and retail businesses can gradually open to market competition. Previously, the National Power Corporation and Electricity Market Operator were already separated from EVN and transferred to the ministry. The plan includes privatizing state-owned enterprises and reducing state shareholding in five generation corporations. A National Strategic Power Generation Corporation is under consideration; initially under EVN, it will later become independent. It will manage strategic multi-purpose hydropower plants like Hòa Bình and Ialy, as well as future nuclear projects to support long-term energy security. Regarding market development, Vietnam plans to separate distribution from retail within five EVN corporations. This starts by separating distribution costs from retail costs before restructuring organizations and shareholding in the long term. Distribution companies will act as independent buyers in the competitive wholesale market and sell to end-users. The process is phased to maintain financial stability and operational capability. A competitive power generation market has been established, with progress on the wholesale market. The goal is to upgrade wholesale competition and establish a competitive retail electricity market in the future, alongside legal framework improvements. The ministry proposed measures to the government to ensure sufficient supply from 2027 to 2030 and will update the Eighth Power Development Plan (PDP8). A draft amendment to the Electricity Law is being prepared for submission to the National Assembly starting October 17, 2026. Measures are also being prepared for severe weather and fuel security before the dry season in 2030. The restructuring supports rising demand from electric vehicles, data centers, and AI. In the first nine months of 2026, installed capacity increased by about 3.5%, below the government target of 6.6%. Total production and imports were 266.58 billion kWh, a 9.65% increase year-on-year. Obstacles include investment approval, land acquisition, investor selection, Power Purchase Agreements (PPAs), and electricity pricing.