RSS Feeds for Mechanisms for December 01, 2023 21:12
Vietnam Energy Forum

Mechanisms for 'transitional' solar and WPPs need to be early promulgated

 - Currently, wind and solar power projects that could not be completed and connected before the deadlines of December 31, 2020 and October 31, 2021 are waiting for electricity prices. This huge amount of social capital needs to be used, so, recently, the Ministry of Industry and Trade (MOIT) sent a document to the Prime Minister for solving the problem.

Until the expiration date of Decision No 13/2020/QD-TTg on incentive mechanism (FIT) for solar power projects and Decision No 39/2018/QD-TTg on FIT for wind power projects, the solar and wind power projects have brought good results: In three years from 2019 to 2021 there were put into operation solar power projects with a capacity of 16,564 MW (including 8,904 MW of the central projects and 7,660 MW of rooftop ones).

However, due to the Covid-19 pandemic and some of investment procedures, there are 62 wind power projects with a total capacity of 3,479 MW with signing power purchase agreements (PPA) with the Electricity of Vietnam (EVN) could not sell electricity because not to complete the COD before October 31, 2021. Besides, there 452 MW of solar power completed after December 31, 2020 is also waiting for the definition of electricity prices for over a year. Including a number of the unfinished projects. The MOIT proposed an option about the price mechanism for all the projects waiting for electricity prices plus the projects unfinished ones which are called as transitional projects.

The proposal of MOIT can be summarized as follows:

MOIT develops and issues the method, procedure and stipulates framework of electricity generation for the solar and wind power projects similar for the traditional power plants for EVN to base on in negotiation and signing PPA with the investors.

On this base, MOIT proposes the Prime Minister:

Firstly, to accept mechanism as above option for the transitional solar and wind power projects.

Secondly, to accept the mechanism on negotiating electricity prices and signing PPA for the solar and wind power projects developed in future for ensuring unity of legal corridor for the projects.

Thirdly, the Prime Minister to issue direction document for MOIT to guide reviewing PPA between EVN and Investors for harmony of interest of the electricity buyers, sellers, consumers and State.

Fourthly, proposing Prime Minister to issue Decision for regulating the previous Decisions on mechanisms for stimulating the solar and wind power projects For example, recently MOIT issued Decision 820/QĐ-BCT dated April 29, 2022 on electricity price framework for coal thermal power and hydropower plants in 2022.

It is necessary to early issue the mechanism for the transitional solar and wind power projects to avoid wasting social resources and pressure on the investors as well as to contribute to reducing electricity shortage in the hot days.


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