Unifying electricity prices for the transitional renewable energy projects before March 31, 2023
15:43 | 23/03/2023
According to this document: On January 7, 2023, the Minister of MOIT signed to promulgate Decision No. 21/QD-BCT for stipulating the framework for electricity prices of the transitional solar and wind power projects.
On January 9, 2023, MOIT issued Document No. 107/BCT-DTDL to require EVN and investors of transitional and wind power projects to urgently coordinate negotiating and unifying the electricity prices with ensuring no extension of the electricity price framework promulgated by MOIT.
On March 2, 2023, MOIT issued Document No. 1094/BCT-DTDL to guide EVN, on the basis of the provisions of the Electricity Law, the relevant contents of transitional solar and wind power projects to negotiate and unify the electricity prices.
Based on the above guidelines, MOIT required EVN to urgently coordinate with the investors of transitional solar and wind power projects to negotiate and unify the electricity prices before March 31, 2023, to quickly put projects into operation for avoiding to waste social resources.
According to a MOIT report, at present, Vietnam has 84 renewable energy projects (with a capacity of more than 4,676 MW) that are behind the schedule of commercial operation compared to the plan. In, 34 transitional projects (28 wind power projects, 6 solar power projects) with a total capacity of nearly 2,091 MW have been completed and tested and have not come into FIT within 20 years by the previous decisions.
In the document, that 36 investors sent to the Prime Minister, they said, with only 34 projects having completed construction investment, the estimated total invested capital was nearly 85 trillion VND, of which over 58 trillion VND was financed from the banks.
In a meeting on March 20 between MOIT, EVN, and 84 wind and solar power investors, the investors suggested EVN mobilize electricity at a provisional price of 6.2 cents/kWh. And, besides, to allow the projects with completing the construction investment, to be accepted in the acceptance test, energized, and recorded the output.
According to Decision 21, the electricity price framework for the transitional solar and wind power projects issued by the MOIT with the ceiling price of solar power projects is 1,185-1,508 VND per kWh and wind power 1,587-1,816 VND per kWh, depending on the type.
Only 1 investor sent documents to serve the negotiation:
On March 20, 2023, at a conference between EVN and investors of transitional renewable energy projects, a representative of the Electricity Power Trading Company (EPTC) said that by March 20, 2023, EPTC has received only 1 set of an investor, although the EPTC has set up three working groups to receive documents.
Previously, for negotiating and unifying the electricity prices of a part of the power project / the whole power project without electricity price, on March 9, 2023, EPTC sent a written document to the transitional wind and solar power investors to check the legal documents of the projects, whether the companies comply with the legal regulations on investment and construction, as well as the documents for evaluating the absorbing ability of the power system operator. Implementing the directing and guiding documents of MOIT and Electricity Regulatory Authority of Vietnam (ERAV) on negotiating electricity prices and power purchase agreement (PPA) for the transitional projects, on March 9, 2023, EVN Power Trading Company (EVN EPTC) sent a document 1790/EPTC-KDMD to 85 investors of the transitional projects to propose the following issues:
Firstly To check the legal documents of the projects whether comply with the legal regulations on investment, and construction and get opinions from the power system operator on the absorption ability of the national power system and the ability to relate the capacity of the power grid related to the project (according to Clause 2, Article 1 of Circular 15/2022/TT-BCT dated October 3, 2022).
Secondly, to develop the electricity price plan by the method of the cash flow discount, similar to the guidance in MOIT Circular No. 57/2020/TT-BCT dated December 31, 2020.
Thirdly: To provide project documents according to the list (as Appendix below):
| No | List of the documents |
| 1 | The document for proposing to negotiate electricity prices and Power Purchase Agreement (PPA) |
| 2 | The legal documents of the projects comply with the legal regulations on investment and construction; Assessing the absorption ability of the national power system and the ability of the power grid to release capacity (according to Clause 2, Article 1 of Circular 15/2022/TT-BCT dated October 3, 2022). |
| 2.1 | 1 The valid decision on investment policy/ Investment certificate. |
| 2.2 | The Business registration certificate of the Company. |
| 2.3 | The appraised and approved basic and technical designs, according to the regulations and attached relevant documents. |
| 2.4 | Valid and appropriate permission certificate for construction. |
| 2.5 | The valid decision on land handing/land leasing of the Provincial People's Committee. |
| 2.6 | The other documents prove compliance with legal regulations on investment and construction (if any). |
| 2.7 | The opinions of the Power System Operator on the absorption ability of the National Power System and the ability of the power grid to release capacity related to the Project. |
| 3 | The decision on the project construction investment is enclosed with an explanation and report on the appraisal of the investment project of the independent consultant and attached documents. |
| 4 | The decision on approving the total initial investment of the project or the adjusted total investment of the project that takes effect at the time of electricity price negotiation and the main contents of the basic design of the investment project relating to the negotiation of electricity prices and the Power Purchase Agreement, the report on the appraisal of the basic design. |
| 5 | The documents related to the financial parameters of the project (The equity of the Investor, Equity divergence in construction years, Loan contract or legal documents between the Investor and the lenders, documents related to the plan or actual disbursement of loan sources). |
| 6 | The document for calculating the electricity output and documents of competent state agencies for approving the electricity output of the project. |
| 7 | The documents on calculating the losses of capacity and electricity of transformers, transmission lines from the power project to the connection point with the national power system, and documents on calculating self-use electricity of the power project. |
| 8 | The estimated costs of operation and maintenance management for one year of operation. |
| 9 | The projects for calculating the electricity prices of the project (in which should be clearly explained the calculation basis for the input parameters to calculate the project's electricity price). |
| 10 | The draft contract, amendments, and supplements to the Power Purchase Agreement, clearly state the proposed amendments to the Power Purchase Agreement. |
In order to have a basis for implementation under negotiation in accordance with the regulations of the competent authority, EPTC wished to receive documents from the transitional investors soon as possible to have a basis for the next steps in regulation and guidelines of the competent authority.
