Privatisation bids to raise cash for energy development

Electricity Vietnam (EVN), the state-owned Vietnamese electricity giant plans to invest almost $13.8 billion in upgrading or building 52 power plants with a combined capacity of 7,574 MW in the 2006-2010 period.

The vast majority of the plants are hydro electric, with just six coal-fired and four gas-fired.

In a related move, the country is set to hold its first initial public offering in the energy sector, auctioning shares in a hydro plant worth more than 437 billion dong ($27.8 million) to raise funds for power expansion. Shares in the 70 MW Vinh Son-Song Hinh plant in the central province of Phu Yen will be sold on the Hanoi stock exchange.

EVN has previously said that it plans to privatise nearly half of its installed capacity through to 2010 in order to raise funds for capacity expansion. The group needs some $2 billion a year to expand generation and network capacity but can raise on around a third of this through tariff revenues.

Foreign investors are allowed to own up to 30% of privatised firms.