Lack of capital delaying power projects: EVN

Power projects being built by Electricity of Viet Nam (EVN) are behind schedule or have been delayed as banks are refusing to offer loans.

EVN said this year that it was building more than 370 small power projects worth a total of VND1,235 billion (US$77.2 million) because of inflation.

Most of the projects were power plants or power grids.

This year the corporation plans to mobilise VND43,130 billion ($2.7 billion) for its power projects. Out of that amount, VND22,655 billion ($1.4 billion) has been scheduled for building power plants.

Some VND5,835 billion would be invested for setting up power grids and the remaining money was left for other projects.

According to the target, the corporation, which has 11 unfinished projects (Ban Ve, Buon Kuop, Srepok 3, Song Tranh 2, Se San 4, and A Vuong), needs VND8,832 billion capital from local banks, but in the first five months the banks have disbursed only VND2,204 billion.

The corporation has worked with Vietcombank, VietinBank, Bank for Investment and Development of Viet Nam, and Viet Nam Bank for Agriculture and Rural Development asking for disbursement.

The banks asked EVN to extend their construction schedules and suggested that only key projects would be a priority. EVN said both domestic and foreign banks were facing difficulties, including Sumitomo, which said it wants to increase interest rates on the loans to EVN.

Construction of the 11 power projects with a capacity of 11 billion kWh a year will be delayed for at least one year. Citibank said it wanted to cancel their commitments for Buon Tua Srah and Plei Krong power plants. In a report about construction of 2008 and the 2008–2015 period, EVN petitioned the Government and the State Bank of Viet Nam to ask the commercial banks to disburse money for electric projects as commited previously, adding that it was the only solution to prevent delays. (VNS)