What’s up with electricity?

roverexpat wrote:

Is it normal for the landlord to charge whatever they want for it? I’m from the USA and have always paid the power company directly. I just got my first bill in Hanoi and I am being charged 3500/unit. No on peak / off peak or anything like that. It seems quite high to me. I’m just curious how this measures up and how I can tell if this is fair.

There was a thread similar to this one on Saigon forum earlier this year in which I explained the different rates the power company charged their customers.  I can't remember all the details and don't want to do a time consuming search, but the explanation was more or less like this: 

Not all customers pay the same rate.  Single renters in boarding houses, large families in their own homes, small buildings, large buildings, small apartment buildings with few units, large apartment buildings with many units, guest houses/day motels, residential hotels, high rise towers, buildings with full facilities, luxury apartments, etc., they all pay different rates. 

Basically, the retail price of electricity is divided into 6 steps:  Up to 50 kWh;  up to 100 kWh; up to 200 kWh;  up to 300 kWh;  up to 400 kWh;  and above 400 kWh.  The higher the amount of electricity consumed, the higher the rate.  Peak period rate is higher than off peak, naturally.

Most expats live in apartment complexes with individual meter for each apartment.  You pay the landlord the cost of kW shown on your meter.  Landlord uses that money to pay EVN on the building's meter for common areas and common facilities such as elevator, water pumps, lights in the corridors and stairways, etc.  Tenants use the facilities but they don't pay the cost to run the facilities, landlord does.  Landlord also pays 10% GTGT tax (VAT in English) for the entire building, tenants don't.  Landlord cannot afford to lose money every month, so he adds a bit more onto the tenant's rate.  Which explains why IT LOOKS LIKE he charges you a lot more than he pays to the power company.

In addition, when a building has a high tenant turnover, when tenants stay less than 12 months, and when the landlord fails to declare the correct number of tenants (they only need to do that once a year), the consumption per capita is off -- it become higher than the norm.  Higher than the norm means higher rate.

In EVN's calculation, 4 people staying in the same unit and sharing the same meter are counted as one household.  If one meter is shared by two people but the consumption is the same as a household of 4, then that usage is higher than the norm.

There are many more factors that make tenants in one building pay more for electricity than another building.  Yes, some landlords do overcharge tenants, but many of them don't charge for every little thing that uses electricity in the building  -- some do, under the general term of "management's fee".. 

You cannot compare what you pay in the US with VN because as you said, you paid the power company directly.  In the US, the meter is in your name, you pay deposit and activation charge with the first bill, then city tax, state stax, county tax, tax for the blinds, contribution towards winter bills for seniors and the poors, etc.  If you're late paying the bill, your electricity is cut and you would have to pay late fee plus reactivation charge.  None of those are in your bill here.

Moreover, 3500 VND is only $0.15.  It's almost $0.21 in California right now, before taxes and fees.  If you want to pay less in electricity, rent a house and pay the entire meter by yourself, but you can only use 1/4 of a household's regular consumption because you're only one person.  Use more than 1/4 and the higher rate will kick in.

Our electricity usage:  3 A/C (1-2 hrs/day), 3 floor fans (24 hrs/day), electric stove (3 - 4x/day), electric kettle (a dozen times/day), washing machine (2x/wk), 2 TVs (alternatively 5 hrs/day), 45 lights, electric kettle (6 - 7x/day), microwave, fridge, iron, juicer, blender, air deep fryer (daily).

Our cost:  730k - 770k (we pay 4k/kW to our landlady who in turn pays the power company 3350 off peak and 4k peak.  She doesn't charge us for unlimited on-demand (solar and electric) hot water so we're actually ahead with that rate, especially when we can run the washing machine and two showers at the same time without any problem.

You asked whether the rate you pay to the landlord is fair.  Here's a statement from a landlord in Hanoi a year ago (Oct 24, 2018, before EVN raised the rate): 

"I am collecting 3,500/kw from my tenants,  but the total amount is still lower than the amount I have to pay to the electricity company." 

From another landlord in Saigon:  "Raise electricity price or raise the rent, I have to do one or the other to recoup what the electricity company charges me. It's an economic problem for landlords."

epsacori wrote:

but it also begs the question of why this is so complicated and why not choose a simple form that will satisfy everyone?

Have you ever seen anything simple, logical, and universally appealing in Vietnam?

panda7 wrote:

if you run an aircon for 10 hours a day you will hit 1M dong in 12 days easy

AC consumes 30 kW/h?  I don't think so.

From bTaskee:
Power consumption of most air conditioner capacity when used in 1 hour:
Hp ~ 750 W. Consumption of about 0.817 kW / h (<1 kW / h)
1.5 Hp ~ 1125W. Consumption of about 1,070 kW / h (~ 1 kW / h)
2.0 Hp ~ 1500W. Consumption of about 1,688 kW / h (> 1 kW / h)

From AC and Water repair Services:
AC with capacity of 1 Hp ~ 750w Consumption of about 0.82 kW / h (<1 unit of electricity)
AC with capacity of 1.5 Hp ~ 1125W. Consumption of about 1.07 kW / h (~ 1 unit of electricity)
AC with capacity of 2 Hp ~ 1500W. Consumption of about 1.7 kW / h (> 1.5 units of electricity)

From Polytechnic electrical and refrigeration technical service center:
* 1.0 Hp ~ 750 W. Consumption of about 0.817 kW / h (<1 kW / h)
* 1.5 Hp ~ 1125 W. Consumption of 1,070 kW / h (~ 1 kW / h)
* 2.0 Hp ~ 1500 W. Consumption of about 1,688 kW / h (> 1.5 kW / h)

Recap:  Based on those 3 technical blogs, the maximum consumption for AC with 2.0 Hp ~1500W capacity is less than 1.5 kW per hour.

QuidProQuo wrote:

You guys like to whine about everything don’t you ? Just suck it up and buy an apartment and you don’t have to deal with all this nonsense.

seriously ? I'd rather rent and pay slightly inflated electricity prices than buy a $100,000 apartment and have some government official come along and say sorry we are reclaiming the land but will pay you half the value...and then be lucky to ever see a dime.

QuidProQuo wrote:

You guys like to whine about everything don’t you ? Just suck it up and buy an apartment and you don’t have to deal with all this nonsense.

you are a bit of an antagonist...

roverexpat wrote:

Little update on this. The landlord is indeed saying that my electric price will be increasing in spite of it being pre-negotiated in the terms of my 12-month lease. So essentially they’re saying the terms of the contract are changing. I’m not exactly sure what to do about this.

I wouldn’t worry about it, they are probably just passing on a tariff increase. Rather than worrying about the increase you’d be better off buying a nice fan which you can put water in (blows out a cool mist) and turning off your aircon permanently. You’ll cut your total bill by 50% and be hundreds of dollars better off.

roverexpat wrote:

Thank you for the perspective. But last I checked the lease agreement there’s no asterisk next to the electric price saying *subject to change*. If they want to reserve the right to change the contract with little notice then they should offer month-to-month leasing options or omit the electric price from the contract entirely.

You need a Vietnamese partner and that will clear up all your problems, guaranteed.