The price of electricity in Viet Nam will go up by 7.5% on March 16 at the suggestion of the state-run Viet Nam Electricity (EVN), a source from the office of the central government said Thursday.

The increase was approved by Prime Minister Nguyen Tan Dung, who chaired a meeting today in Ha Noi with representatives of the Ministry of Industry and Trade and EVN to consider the proposal.

The average price of electricity in Viet Nam will be 1,622 VND per kWh as of March 16.

Technicians of the Vietnam Electricity are seen building a grid.

The adjustment of the electricity price is targeted at helping EVN cut losses from previous years, ensuring Gross Domestic Product (GDP) growth at 6.2% this year, and keeping the inflation rate at 5%.

It is estimated that EVN would suffer a loss of 12 trillion VND (577 million USD) in 2015 if the electricity price were to remain unchanged.

In addition, EVN is now sustaining another loss of 8 trillion VND (384.6 million USD) due to exchange rate differences.

At the meeting, Prime Minister Dung also instructed EVN to improve its grid to lower the loss of electricity rate to 8% this year.  In 2014, it was 8.49 %.