I.

Market structure
1. A ‘‘few’’ large firms

* Vietnam Electricity (EVN)

At the top of the list is Electricity Group - The Group is monopolizing business
lines related to electricity. With the mission of providing the right time, enough
power output according to the demand for the national grid system and improving
service quality;
Main business areas are production, regulation, electricity trading, import and
export of electricity, investment and management of investment capital in power
projects.
The Group invests in building and owns power generation plants, power
transmission systems, distribution grids, dispatching and operating the national
grid, and importing and exporting electricity with neighboring countries such as
China. , Laos and Cambodia, ensuring power supply to implement the operation
plan required by the Vietnamese government.
Carrying out the task of supplying electricity for the country's socio-economic
development needs, EVN currently has 3 power generation corporations (GENCO
1, 2, 3) and 9 hydro/thermal power companies in the field of electricity. electricity
production, 5 power corporations trade electricity to customers: Northern
Electricity Corporation (EVNNPC), Central Power Corporation (EVNCPC),
Southern Electricity Corporation (EVNSPC).City Electricity Corporation.Hanoi
(EVNHANOI), City Electricity Corporation. Ho Chi Minh City (EVNHCMC). In
charge of the electricity transmission field of Vietnam Electricity Group is the
National Power Transmission Corporation (EVNNPT).
Tập đoàn Điện lực Việt Nam cung cấp mạng lưới điện quốc gia.
2.High barrier to entry

In the electrical industry, electricity enterprises must be faced to the enormous

entry barrier . The reason is that Vietnam's electricity market is being managed
by the State and there is quite a lot of competition. Therefore, to enter this
market, new companies must have a very large investment capital, must meet
many technical and management requirements and most importantly, must have
licenses, certificates, and the standards of state management agencies.
* Large capital investment: To build power plants, transmission lines and
power distribution systems requires huge investments. Therefore, new
companies that want to enter the electricity market need to have equivalent
investment capital to be able to build infrastructure, purchase equipment and
train human resources.
* Legal regulations: Legal regulations on environmental protection,
occupational safety and network security also make it difficult for new
companies to enter the electricity market. Complying with these regulations
requires large investments to comply with environmental protection standards
and ensure the safety of workers and customers.
* Technology and expertise: To operate modern power plants and power
systems, engineers and specialists are required with specialized knowledge and
practical experience in new technologies such as renewable energy, power
storage and energy management systems. Recruiting and training highly
qualified human resources also requires large investments from new companies
wanting to enter the electricity market.
* Competition from other companies: There are many other companies that are
also developing EVN power technology. Investors must compete with these
companies to maintain market share and increase sales.
 Therefore, to participate in EVN's electricity sector, investors must have:
 Advancing technologies and techiques
 Planning for environment protecting
 • Strengthening social responsibility
 Illustrating experience,finance strength,technical level
• Training high quality human resources
Furthermore,firms that want to join Mid-stream’s activity should prepare a lot
of capital,and must comply with the regulations and standards of electricals
safely of the state of Vietnam.
3. Collusion and mergers
Electricity EVN is a state-owned company and is licensed to be the sole power
supply unit in Vietnam. This means that EVN has control over electricity prices
in the market and there is no competition from other power supply companies.
In 1994, the Government of Vietnam decided to merge the power companies
into a single corporation named Electricity of Vietnam (EVN). This merger
aims to optimize the management and operation of the domestic electricity
industry, thereby ensuring an adequate, stable and safe electricity supply for the
people as well as developing the country's economy. After the merger, EVN has
become one of the largest and most important industrial groups in Vietnam.
The average electricity selling price is established annually on the basis of the
cost of purchasing electricity from the generating units, the cost and the normed
profit of the stages of electricity transmission, distribution - retailing,
dispatching of the power system and administering electricity market
transactions, the cost of ancillary services of the power system, the general
management costs of the Electricity of Vietnam to ensure the ability to operate,
supply electricity and meet the investment demand according to the regulations.
plans promulgated by competent state management agencies.
The cost of purchasing electricity from power generating units shall comply
with regulations on operation of the electricity market at each level issued by
the Ministry of Industry and Trade and according to the Power Purchase
Agreement signed between the generating unit and the electricity purchaser. .
Expenses for purchasing electricity transmission services, electricity
distribution and retailing services, general management costs, costs for
purchasing electricity system dispatching services and conducting electricity
market transactions are determined on the basis of costs. fees plus normed profit
of the stages of electricity transmission, distribution - retailing, electricity
system dispatching and electricity market transaction administration, ancillary
service costs of the power system, general management costs of the Electricity
of Vietnam according to regulations promulgated by the Ministry of Industry
and Trade.
The formation of EVN's electricity price also depends on the State's regulations
on electricity prices and the mechanism for updating electricity prices according
to production, operation and investment costs. This mechanism is specified in
Decree 134/2013/ND-CP of the Government on electricity price mechanism.
However, in order to ensure economic feasibility and reasonable prices for
consumers, EVN also regularly checks, evaluates and adjusts electricity prices
according to the time and production and business situation of the electricity
industry. power.
With the characteristics of: A “few” large firms dominate the market, Firms
are interdependent, Substantial barriers to entry. Hence, the market situation
is matched with Oligopoly.