Household Electricity Affordability Under Rising Costs in Vietnam: A Service–Capacity Gap Approach

This study develops a Service–Capacity Gap (SCG) approach to examine household electricity affordability under rising costs in Vietnam. SCG compares each household’s electricity service-cost position with its core consumption-capacity position. Using 46,375 household-year observations from VHLSS 2012–2020, the study identifies four affordability positions: service-cost pressure (SCP: 36.60%), low service-cost non-pressure (LNP: 24.46%), capacity-supported service-cost (CSS: 20.73%), and low service-cost but capacity-constrained households (LCC: 18.21%). Benchmark comparisons show that high-burden and LIHC-type diagnostics align mainly with SCP, while low-use indicators split between LNP and LCC. LNP records only 2.22% LIHC-type risk despite 49.15% falling below the low-use threshold, whereas CSS exhibits no LIHC-type risk despite relatively high electricity costs. Socioeconomic profiles further show that LCC is more capacity-constrained than LNP, and CSS has stronger capacity than SCP. Under a 30% electricity-cost shock, new exposure reaches 28.99% for CSS and 19.03% for LNP. The main diagnostic value of SCG is that it resolves two ambiguities that conventional indicators tend to conflate: low service-cost can mean either non-pressure or hidden capacity constraint, while high service-cost can mean either affordability pressure or capacity-supported service use. Policy should use SCG to target low-use households with weak capacity (LCC), avoid automatic subsidies for low-use non-pressure households (LNP), and monitor near-boundary households exposed to rising costs.