Vietnam implements rural electrification project

Some 352,000 families in Vietnam's middle coastal province of Quang Nam - Da Nang (QN-DN) will soon benefit from a rural electrification project which is bringing on-line many areas not served by older distribution networks. The project aims at improving access to electricity in 14 rural districts, where demand has outgrown the distribution network. The OPEC Fund cofinanced the project with a loan of $10 million. Fully onstream, it should help reduce system losses and lower the consumer price for electricity.

Quang Nam Province, together with its provincial capital, Da Nang city, has a population of just under two million people. The amount of power available in the province (from the national grid and various other sources) is judged adequate for present and projected future demands. Power shortages exist, nevertheless, especially in remote areas, due to large discrepancies between generating and distribution capacities.

Quang Nam is predominantly rural, but the number of small-scale and cottage industries has grown rapidly during the past decade, and with it, the need for more electricity for commercial purposes. Shortly before this project was approved in 1996, about 18% of the province's total work force of some 850,000 was engaged in the trade and services sector. Industry employed about 15%, followed by transport and construction (together) with 5%. Even in agriculture, which still employs an estimated 60% of the population, the amount of power required for irrigation pumps and other farm machines has increased as mechanized methods gain acceptance and begin to supplement human labor.

In recent years, QN-DN has made good progress towards economic development and has succeeded in attracting some domestic and foreign capital. Most of the investments, however, have been in Da Nang city and other urban areas. The rural areas continue to lag behind. One of the most serious handicaps to their development has been the lack of a distribution network capable of supplying adequate amounts of electricity. With this project completed, that situation is beginning to change.

The ground-breaking ceremony for the Quang Nam rural electrification project was attended by Government ministers and officials from Da Nang, the provincial capital.

Under the project, over 425 km of medium voltage transmission lines have been erected. They are being connected to and integrated with the existing electrical network. In all, 241 substations, with a total capacity of 25,830 kV-A, were built, and some 425 km of low voltage (0.4 kV) distribution lines installed to ensure the delivery of electricity to the end-users and to reduce system losses. The project also financed the construction of access roads, the costs for engineering and design, and the purchase of substation sites, as well as the procurement of all the necessary materials and equipment, including transformers, cables and switching gear.

The benefits of rural electrification are always far-reaching. Having the possibility to utilize electric-powered farm machinery and irrigation pumps should enable area farmers to raise production and introduce multiple cropping. The electrification of tube-wells, irrigation systems, rice mills, and the use of home appliances and electric tools will reduce physical work on everyday tasks and allow more time and energy for other pursuits, including the education of children. Especially in remote rural areas, electrification also means decreasing isolation, easier communication with other areas and more opportunities to learn new skills and methods. The advantages offered by better access to inexpensive power will not remain confined to the agricultural sector. Cheap, ample electricity should also encourage the establishment of new businesses and small-scale industries, thereby creating more opportunities for employment and discouraging migration to urban areas.

In addition to the civil works involved in expanding the network, the project also provided training courses to prepare local technicians to operate, repair and maintain the new power grid equipment, wire homes and businesses, and install motors, lighting systems and various kinds of electrical equipment. It gave technical and institution-building assistance to the Rural Electrification Board (REB) of Quang Nam, to help it develop more efficient planning, accounting and billing systems.

Similar assistance was extended to the semi-autonomous rural electrification cooperatives (RECs), which manage electrification at district and commune levels, once a particular distribution network has been completed. The RECs are responsible for planning at the local level, helping consumers wire their premises and acquire and install electrical appliances, and meter reading, billing and collections. At both the REB and REC levels, efforts have been made to improve the tariff structure and to set user tariffs that will enable the system to become self-financing to a high degree. All of these measures should ensure the sustainability of rural electricity in Quang Nam and lay a firm foundation for its future expansion.


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