Therefore, to get right progress and successful from undergrouding low voltage cable projects and to implement these proejcts in time at urban areas and big citi[r]
Trang 142
Original Article Renovating the View of Cost Sharing for the Underground
Low Voltage Cable Projects in Hanoi
Pham Thi Thu Ha1,*, Phan Dieu Huong2
1
Department of Industrial Economics, School of Economics and Management,
Hanoi Univeristy of Sciense and Technology, No 1, Dai Co Viet, Hai Ba Trung, Hanoi, Vietnam
2 Department of Industrial Economics, School of Economics and Management,
Hanoi Univeristy of Sciense and Technology, No 1, Dai Co Viet, Hai Ba Trung, Hanoi, Vietnam
Received 03 December 2019 Revised 26 December 2019; Accepted 26 December 2019
Abstract: Underground power grid projects in Hanoi is so urgent that it requires immediate
implementation To synchronously and quickly implement the underground power grid projects, people in charge should not follow the outdated perspectives of just including the power industry, but also need to call for the support and cost sharing responsibility from consumers This paper aims at approaching the subject both from the producers and consumers’ perspectives to together sharing the cost of putting the power grid underground not only in Hanoi but other metropolitans
in Vietnam as well Field studies (including 104 families) at Hoan Kiem District, Hanoi and CBA method were applied to investigate the willingness to pay (WTP) level of consumers to share the cost with the power industry for the underground power grid projects in Hanoi The overview of the results shows that cost for the underground power grid in Hoan Kiem District ranging from 30,000 VND/household/month to 46,000VND/household/month On the other hand, the willingness to pay of a typical household of four people within Hoan Kiem District ranges from 17,000VND/month to 24,000VND/month, with the most favorable method of annual payment within a detailed timeline
Keywords: Underground low voltage cables, approaching from both sides, cost sharing, Hoan Kiem
District, Hanoi
1 Introduction *
The point of view about undergrounding
telecomunication cables, low voltage cables,
_
* Corresponding author
E-mail address: ha.phamthithu@gmail.com
https://doi.org/10.25073/2588-1108/vnueab.4295
midle voltage cables in the big cities of Vietnam to make clean roads, safety for urban transportation as well as operating electricity is matched with customers’s vision There are some announcements at Hanoi [5], Phu Ly city [7], Ho Chi Minh city [9] that underground low voltage cables at some streets to deal with the
Trang 2weight and complilcated of bunches of power
cable grids that makes dangerous for people
when they joint into transpotation, and
especially in the rainny and flood season
From EVN Vietnam as well as Electricity
Companies, they have detail plans for
undergrouding low and medium voltage cables
project steps by steps in big cities such as Hanoi
[5], Khanh Hoa [8], Hochiminh City From the
secondary data, almost underground electricity
cables projects have been implemented that
were agreed by customers who live around this
place, and it was being tidy, clean space in city,
especialy, it is more safety for public
transportation and operating power in city
However, there are some hurdles are existed
during implement these projects that affects to
customers’s daily living, while in some streets
in Hanoi and Hochiminh City the projects have
not been implemented completely
Therefore, what are difficulties needed to
solve from the role of Department of
Electricity and from the customers in big cities
like Hanoi, Hochiminh City to force the
progress of undergrouding low voltage cable
projects and create a new image for Department
of Electricity together with massive urbaniation
as hopes of all stakeholders Furthemore, it is
needed to change the awareness about social
benefits and responsibilities of enterpreneurs
and it is needed to hand on of all parties to
support for public projects with the highest aim
is innovating sustainable living standard in
present as well as in the future
2 Change the awareness about methodology
to approach benefits of public projects
There is so much changes in the opinion to
run electricity business and to service
customers, and it catches up the awareness of
developement about high quality as severvice
sector However, in so many projects, the
Department of Electricity is still “to act
single-handed” even all projecs are focusing on social
goals Moreover, Department of Electricity has
done good job of undergrouding low voltage cable projects in some urban areas and big cities; but, while the Department of Electricity has to pay to invest for these projects, they still have to face with these negative responses form customers who are living at these areas even they get benefits directly
Therefore, to get right progress and successful from undergrouding low voltage cable projects and to implement these proejcts
in time at urban areas and big cities, it is not only needed to change the awareness of Department of Electricity, but also need to have
a methodology to approach stakeholders who are both Department of Electricity as well as customers who are living in urban areas and big cities The rights and obligations of Department
of Electricity from undergrounding low voltage cable projects are the benefits and responsibilites of customers to support for implementing these projects successfully And
it is needed to find out the same voice between the side of services suppliers and the side of customers, and the understanding from both stakeholders who get benefits from these projects Moreover, the deep understand and support of each stakeholders will lead to less pressure about finance problems when running these projects, and customers also aware the needed of their supporting for developing electricity sector as well as they are willing to pay for electricity expenses, beside that they do not get problems of “must pay” and intransparent of electicity expenses
The detail solutions to approach electricity sector in the underground low voltage cable projects in urban areas and big citis are not only projects belong to Department of Electricity but also is costing electricity tuition from customers who live in these areas However, this approach is only successful when
we persuade customers to agree and accept benefits from these proejcts because of they are not considered as the underground cables of telecommuinication projects before
The experimental research is implemented
to approach two stakeholders of these underground low voltage cable projects are
Trang 3Department of Electricity and customers who
are living in Hoan Kiem District, Hanoi to get
evidences for demontrating detail of solutions
as well as to deeply understand these
difficulties of each parties that are needed to
solve when these projects are running
3 The case study of undergrounding low
voltage cable projects at Hoan Kiem District,
Hanoi
The undergrounding low voltage cable
project on streets at Hoan Kiem District, Hanoi
was selected as a case study in this paper We
have chosen this place as an experimental
research because it is a district at center of
Hanoi, and especially there are old quarter
streets where customers run their business for
years Moreover, this place is difficult to
implement underground low voltage cables
because there are so many houses, flats and
building that located on narrows streets as well
as small pavement, and particularly it is always
crowded of not only local customers but also
foreign tourists An experiemental research of
undergrounding low voltage cable on streets
around Hoan Kiem District will be the case
study to be applied on other internal streets
around Hanoi
The cost of undergrouding low voltage
cable projects is related to cost of surplus
investment and the cost of O&M directly, and it
is not need to concern on other flexible
expenses that could be changed not much in
operating the low voltage grids in case of
hanging on power poles and underground
cables The primary data of this project is
presented in Table 1
Table 1 The input data of undergrounding low
voltage on streets at Hoan Kiem District
Total investment Million VND 14264.00
Life of project Annual 20
The ratio of
discount
Quality Electricity Annual
Million kWh 35.54 The number of
households on streets
Household 4413
Source: Hoan Kiem Electricity Company, Hanoi
Electricty Company
In the context of Department of Electricity, the cost will be calculated by annual and it is measuared for changing factors such as total investment, life of project, the ratio of discount, the density of population The results was analysis and presented in part 3.1 of this paper Approaching the potential of accepting to pay for undergrounding low voltage cable project from the side of customers who are living in Hoan Kiem District, we have chosen the size of sample is 150 households to collect data Finally, we have just collected data of 104 households, and we will use this data to analysis and evaluate potential and responsible
of accepting to pay more cost for undergrounding low voltage cables of customers who live at Hoan Kiem District The results of survey and analysis about approaching customers who are living at Hoan Kiem District will be shown specifically on the part 3.2 of this paper
3.1 Approaching from department of electricity
The total expenses per year for undergrounding low voltage cables on streets around Hoan Kiem District will be concluded the cost of investment and O&M cost annual, and the results is provided on Table 2
Table 2 The total expenses per year for undergrounding low voltage cables on streets in
Hoan Kiem District
The investment cost per year
Million VND 1675.44 The O&M cost
per year
Million VND 142.64 Total cost per
year
Million VND 1818.08
Trang 4The average cost
for 1kWh
The Average
cost for 1
household/monht
Thousand VND/household/month
34.33
Sources: Aurthor’s Calculated
It has been seen from the point of view of
Department of Electricity, when implementing
undergroud low voltage cable project they will
get pressure of increasing cost of investment
This is not small amount when applying to
underground low voltage cables in all streets at
big cites Moreover, the other rasing cost is not
concerned on such as the traffic jam, affecting
on business of customers who are living on
these streets when the projects is implemented
Besides, it is difficult to evaluate raising cost,
and it could be changed a lot if the low voltage
cables is long and keep through many different
streets However, it is needed to study more
adequate in the context of social-economic
The total expense per year as well as
average cost per 1kWh, the average expense per
1 household/month will be changed when the
input sources changed The results of analysis
about changing of average cost per 1
household/month is provided on Table 3
Table 3 The average cost per 1 household in case
of undergrounding low voltage cables at Hoan
Kiem District Unit: Thousand VND/household/month
Change of total investment to compare with primary
plans
Primary
plans
34.33 35.02 36.05 37.77 39.48
Change of life of project to compare with primary
projects
Primary
plans
-10% -20% -30% -50%
34.33 35.54 37.12 39.26 46.53
Change of population density to compare with primary
plans
Primary plans
34.33 33.66 32.70 32.21 29.85 Change of ratio of discount to compare with primary plans
Primary plans
34.33 36.52 38.75 41.04 45.73
Sources: Aurthor’s Calculated
The results shows that when the total investment and the ratio of discount are increased or the life of project decreased will lead to risen the average cost of electricity per household per month to compare with primary plans In contrast, when population density is creased at place where the underground low voltage cables was implemented will lead to decrease the average cost of electricity per household per month to compare with primary plans Besides, there is an important factor that affects to arverage cost of electricity per 1kWh
of underground low voltage cables is the quality
of power However, there is any evidences that provides a benchmark about fluctuating of this factor, therefore we assume that the quality of power is stable in case of undergrouding low voltage cables Thus, the measurment about average cost of electricity for 1 household in Hoan Kiem District will be fluctuated from VND30,000 per household per month to VND46,000 per household per month
Obviously, there is no one will be accepted for this rising cost as well as the Department of Electricity has not any reasons to pay the whole
of 100% cost of this project for customers who live in these streets However, the amount of increasing cost when calculating 100% is not too much to compare with the average cost of electricity per month of each household in each street (the primary plans is provided the average cost of electricity is VND34,000 for one household per month to compare with VND1.4 million for one household per month, it is estimated as 2.4% the cost of eclectricity for one household per month)
Trang 5Therefore, the average cost of electricity is
calculated for one household per month in the
undergroud low voltage cables in streets around
Hoan Kiem District in Table 2 and 3 will be
decreased as the level of acceptance about cost
sharing of customers who live in these streets
In reality, there is any Precedents or Regulars
about the ratio of cost sharing to reference Thus, we will provide levels to define the fluctuated threshold when the ratio of cost sharing is different The table 4 presents results
of changing average cost of electricity per one household/month in the underground low voltage cables
Table 4 The average cost of electricity for one household per month
in the underground low voltage cables at Hoan Kiem District
Average cost of electricity per 1
household/ month (Thousand
VND/household/month)
Solution of the sharing cost in underground low voltage cables project between Department of Electricity and Customers
Primary ratio 90/10 80/20 70/30 60/40 50/50
Sources: Aurthor’s Calculated
Obviously, from the side of electricity
sector, if the customers accept sharing about
90%, the average cost of electricity for one
household per month, it will be only increased
about VND30,000 per month, on the other
hand, it is increased one day of using electricity
per month respectively (about 20kWh at the firt
level of 50kWh) At low levels of sharing cost,
the changing of electricity cost per household is
not much (the lowest level of sharing cost is
10% will lead to increase about VND3,400 per
household/month, the level of sharing cost is
50% will be VND17,000 per household/month
respectively) If customers accept to share at
level of 10%, it will be saved VND1.55 billion
for each streets, and this cost is not small one,
and it is valuable to develop other needed
projects to supply for life living or to upgrade
the quality of power as well as the safety and
integrity in providing electricity from
underground low voltage cables
The important thing is how customers
feedback for this approach while there is no one
has concerned on projects of Department of
Electricity even these projects leads to benefits
for each households The answers will be
provided through survey to get feedbacks of
customers who are living on streets around
Hoan Kiem District about underground low
voltage cable projects and the approaching to
share cost as the levels of acceptance to pay from the side of customer
3.2 Approaching from customers side
To get feedbacks from customers who are living on streets where the underground low voltage cables are implemented at Hoan Kiem District, we have studied the sample of 150 households and get the data of 104 households completely Therefore, the results will be focused on data of these 104 households The questionnair was designed as two main parts: (i) general information about demographic and livelihood of households, (ii) the information that are relevant to feedbacks of customers about underground low voltage cables and the potential of acceptance as well as the level of paying for increasing cost when this project is implemented
The descriptive information of surveyed households:
- There are 104 households, the customers who have answered questionnairs are household owner (100% are male)1, the number of people
in each household are often 4 people/household (the minimum is 2 people/household and maximum is 6 people/household)
- The education levels are college, univerity, and post graduate (100%)
_
1 The participators are household owners who are all male
Trang 6- The average income of one household is
under VND30 million per month
The data of using electricity, average cost
of electricity and income of each household per
month is provided in Table 5
Table 5 Using electricity, expense of electricity
and average income of serveyed household
Number of households (household)
Ratio (%)
Number of people per
household
(people/household)
Using electricity
(kWh/month)
Expense of Electricity
(VND thousand/month
From 500 - 1000 19 18.27
From 1000 - 2000 81 77.88
Average income per
million/month)
Number of households (household)
Ratio (%)
Sources: Aurthor’s Calculated
The results shows that these factors are age, education levels, occupations impact sharply to awareness of all stakeholders about the underground low voltage cables, and especially these households who have paid much for using electricity have concerned on the increasing expense than the other ones Therefore, the consideration on benefits of undergrounding low voltage cables as well as the potential of willing to pay for increasing expense and other payments will be different among households
We evaluated feedbacks from customers who had awareness of benefíts from underground low voltage cables on streets around Hoan Kiem District To estimate the agreement levels about benefits of these projects, we used Likert’s 5 point from 1 to 5,
in which 1 is definitely disagreement and 5 is definitely agreement (2 is disagree, 3 is not given, 4 is agreement) The results of anlysis about feedbacks of customers who have participated in this survey is presneted in Table 6
Table 6 Awareness of customers about the benefits
of undergrouding low voltage cables at Hoan Kiem District
Criteria N Range Minimum Maximum Mean Std.Deviation Variance
Benefits of underground low
voltage cables
Art look for urban areas 104 3.00 2.00 5.00 3.66 0.81 0.67
Safety for transportation 104 3.00 2.00 5.00 3.56 0.80 0.65
Safety for electricity grids 104 3.00 2.00 5.00 3.52 0.76 0.58
Decreasing traffic jam 104 3.00 2.00 5.00 3.50 0.72 0.52
Increasing house price 104 3.00 2.00 5.00 3.48 0.73 0.54
Increasing travel and tourists 104 3.00 2.00 5.00 3.56 0.80 0.65
Sources: Aurthor’s Calculated
Trang 7The information in Table 6 firgures out the
awareness of customers about benefits of
projects (the average point is 3.72 means that
the level of agreement of customers is quite
high) Obviously, the direct benefits from these
projects is the safety in operating and supplying
power that is known by customers and they
have accepted over 3.4 point and there is not
1.0 point (the lowest level about increasing the
price of house where there is underground low
voltage cables is 3.48 point and the highest
level is 3.66 point about creating art look for
urban areas) Besides, these factors about
increasing house price, creating potential for
travel and tourists and decreasing traffic jam are
less concerned
The factor of creating art look for urban
areas was known first because the image of
complicating, overlapping, weighted, dirty, and
dangerous electricity cables was evil and made
people at these urban areas felt uncomfortable
In long time, urban people wanted to change
electricity cables, they also wanted to innovate
their living environment but they could not
solve these problems In the past, Department
of Electricity has not concerned on these
projects and they also have not got enough
conditions to implement unifined projects of
underground low voltage cables, infrastructure,
underground telecomunicaton cables, and water
pipes Therefore, customers have had positive
responses for underground low voltage cables
projects that is corresponded with the survey results
Furthermore, these factors about increasing price of houses, potential of travelling and tourism, or decreasing traffic jam are still not studied deeply Therefore, they are evaluated less than the factor of creating art look for urban areas In addtion, some customers have supposed that these underground low voltage cables will lead to lower price of houses because of changing electricity poles by electricity boxes that are existed closely in front
of houses And this is also the probems of customers who are living on some streets in Hanoi where these projects have been done [4]
When customers have awareness about benefits of underground low voltage cables, they will support more for Department of Electricity to implement these projects Obviously, change the awareness of customers
by being proactive in constructing, innovating, enhencing quality of living environment; do not waiting, and be not passive element in public projects Once customers understand [5], [8] about right and obligations of underground low voltage cables, they will support and accept easily for difficulties of implementing these projects The results about potential of accepting to pay for sharing added cost with Department of Electricity as well as the cost that customers could pay are provided in Table 72
Table 7 The potential of willing to pay for cost
of undergrounding low voltage cables at Hoan Kiem District2
Criteria N Range Minimum Maximum Mean Std.Deviation
Accepting to pay for added cost 104 4.00 1.00 5.00 3.24 0.88
The level of accepting to pay for
added cost
Lower than cleaning fee
(<VND6000/person/month)
Equivalent cleaning fee (=
VND6000/person/month)
Higher than cleaning
fee(>VND6000/person/month)
_
2 The services prices of collecting and moving waste as Decisions 54/2016/QĐ - UBND
Trang 8Criteria N Range Minimum Maximum Mean Std.Deviation
Period of collecting money 104 4.00 1.00 5.00 3.24 0.89
Calculating as electricity used 27 4.00 1.00 5.00 2.89 0.89
Calculating as number of people per
household
Calculating as investment cost 27 4.00 1.00 5.00 3.52 1.19
Sources: Aurthor’s Calculated
The results on table 7 shows that the factor
of willing to pay for added cost when
underground low voltage cables are
implemented on streets around Hoan Kiem
District is not high (the average point is
3.24/5.0), however, the quantity of agreements
is higher than disagreement or definitely
agreement Thus, customers have understood
benefits of these projects and they also thinking
positively of innovating living environment that
relevants to society
With regard to feedbacks of customers
about levels of cost, period to collect money
and how to calculate cost for undergrounding
low voltage cables are positively corresponded
with attitude of willing to pay However, even
almost factors are over 3.0/5.0 (except the
factor of how to calculate cost is lowest point
with 2.89/5.0) Almost customers can pay for
added cost that equivalent cleaning fee (about
VND6000/person/month, it is estimated
respectively about VND24,000/4
customers/month, it is increased about 1.7% to
compare with current monthly average cost of
electricity of each household) The factor of
period to collect money is highest point at
(4.0/5.0) and the method to calculate cost by the
number of customers per household (as the
cleaning fee that is applied for urban areas) also
get high point at 4.38/5.0
Furthermore, customers want to know the
transparent of cost distribution, clearly period to
collect money and the level of cost will be
stable during informing time The results also
shows that there are some hurdles about
potential of willing to share cost of projects as
well as awareness of responsibilities for underground low voltage cables that are belong
to Department of Electricity, or customers do not need to pay for any cost and these projects must be implemented as the development trend Moreover, some of them supposed that this cost has been not used reasonable as well as the period to collect money not suitable that will lead to added cost on electricity bill of customers Obviously, these worries are right, but to deal with these problem we need the detail of analysis and a clear plan from Department of Electricity
Finally, both of Department of Electricity and customers will have the same voice about underground low voltage cables in Hoan Kiem District as well as in other big cities? The answers will be presented at part 3.3 as the results of approaching two stakeholders that are Department of Electricity (cost) and customers (the level of willing to pay)
3.3 Changing awareness to develop together
Regarding to approaching from both Department of Electricity and customers who are living on streets where these underground low voltage cables are implemented, there is not any researches before to reference However, to develop, innovating environment positively and proactively, it is needed customers participate
in these projects
The results of survey shows that Department of Electricity is building detail plan, cost and progress for underground low voltage cables at big cities This is also the
Trang 9trend of implement infrastructure projects in
developed countries
From the customers role, they have had
awareness clearly about benefits from
underground low voltage cables, and most of
them willing to pay for added cost to share
pressure with Department of Electricity to
change their living environment for better life
The level of cost equivalents to cleaning fee
(about VND6000/person/month, respectively
VND24,000/household/month), and the period
to collect money is annual (there is detail
schedule) and with this level of cost the ratio
sharing will be 70/30; and if the level of cost is
lower cleaning fee, the ratio sharing will bee
60/40 and it is VND13,600/household/month;
the ratio sharing is 50/50 corresponds to level
of cost is VND17,000 household/month
The changing awareness of stakeholders in
underground low voltage cables at urban areas
will be the first steps for customers participate
and make decisions to encourage public
projects are implemented soon However, when
this approach is applied, it is needed to
communicate about benefits of public projects
and the right as well as obligations of all
stakehoulders who participate in investing and
implementing these projects Besides, it is also
needed to provide the detail plan and progress
to implement public projects quickly and do not
impact to living activities of customers who are
living on those streets during active times
Acctually, the problems of underground low
voltage cables is not only financial term [8] but
also is the transparent in cost management for
these projects [9]
4 Conclusion
To implement underground low voltage
cables in right progress in big cities, it is needed
to cooperate between organizations and
stakeholders as well as the supporting from
Government side for these projects
With regard to constructing organizations, it
is required to intergrated management of quality, detail implement progress, cleaning environment and safety for transports to avoid troubles for customers’s living in these streets where underground low voltage cables are implemented
Finally, to get payment for these projects, it
is needed to have detail analysis of solutions and plan to implement underground low voltage cables steps by steps The Departement of Electricity should provide a plan of developing electricity grids in the future, and focasting performance of operating electricity for constructing technical trails to develop underground low voltage cables The oppinions that approaching sharing cost with customers should be officially to avoid lacking transparent
in collecting and distributing cost of projects
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