Checking legal documents in the wind and solar power projects without electricity prices

In Document No: 1790/EPTC-KDMD, dated 9/3/2023, the Power Trading Company also asked the investors to build the electricity prices according to the method of the cash flow discount similar to the guidance at Circular No. 57/2020/TT-BCT dated December 31, 2020, of the Ministry of Industry and Trade (MOIT).

Previously, on March 2, 2023, MOIT issued a written document for Electricity of Vietnam (EVN) to urgently coordinate with the investors of the transition wind and solar power projects to agree and unify the electricity prices under the direction of this agency in Document No. 107/BCT-DTDL.

According to the content of Document No: 1094/BCT-DTDL, dated March 2, 2023, MOIT informed that pursuant to the provisions of Decree 137/2013/ND-CP dated October 21, 2013 of the Government on the detailing regulations and a number of articles of the Electricity Law and the Law amending and supplementing a number of articles of the Electricity Law, MOIT has opinions on the methods of determining electricity generation prices for solar and wind power projects as follows:

Firstly: The principles for determining electricity generation prices: Clause 1, Article 29 of the Electricity Law on the electricity policy of the electricity prices stipulates: “To make conditions for the economic components to invest in electricity development with reasonable profits” and Clause 4, Article 29 of the Electricity Law (amended and supplemented by Clause 13, Article 1 of the Law amending and supplementing a number of articles of the Electricity Law) regulates: "to ensure the right to self-determination of the electricity purchase prices within the framework of electricity prices and structure of the retail electricity prices prescribed by the State for the electricity buyers and sellers on the electricity market".

Clause 3, Article 31 of the Electricity Law (amended and supplemented by Clause 15, Article 1 of the Law amending and supplementing a number of articles of the Electricity Law) stipulates: “The prices of the electricity generation under the terminable power purchase agreements, the wholesale price of electricity agreed by the electricity units, but must not exceed the electricity generation price and the approved wholesale electricity price frameworks “.

On January 7, 2023, MOIT signed Decision No. 21/QD-BCT promulgating the electricity generation price framework applicable to the transitional solar and wind power projects

Secondly, regarding PPA

The PPA for the transition solar and wind power projects should be negotiated and adjusted on the basis of the assigned contracts as well as the contents regulated in Circular No 01/2023/TT-BCT dated January 19, 2023, on repealing a number of the regulations in Circular No 02/2019/TT-BCT dated January 15, 2019, to regulate the wind development implementing the sample PPA for the wind projects and the Circular No 18/2020/TT-BCT dated July 07, 2020 on the solar power projects and PPA for the solar power projects.

Pursuant to the provisions of the Electricity Law, the above guidelines and relevant contents suitable to the real conditions of the power projects, MOIT asks EVN to hurry up coordinating the investors of the transitional solar and wind power projects to agree and unify the electricity prices in accordance with MOIT document in No 107/BCT-ĐTĐL.

Previously, on January 7, 2023, MOIT issued Decision No. 21/QD-BCT promulgating the price framework for electricity generation of the transitional solar and wind power projects. The price framework of this Decision will be the basis for EVN and the transitional solar and wind power generation units to negotiate electricity generation prices according to regulations.

Decision No. 21/QD-BCT takes effect from January 7, 2023. The specific prices are as follows: