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Concerns over the price range for wind turbine generation, low transitional solar power and urgent construction and clearance times are worrying investors.

Tran Viet Hoa, Director of the Electricity Regulatory Authority, provided information on transition projects for wind and solar energy.

Tran Viet Hoa, Director of the Electricity Regulatory Authority, provided information on transition projects for wind and solar energy.

As of May 26, 2023, the Ministry of Industry and Trade reported that 52 out of 85 solar and wind power plants with a total capacity of 3,155 MW (equivalent to 67%) had submitted applications to EVN. Force of Vietnam (EVN). 42 plants with a total output of 2,258.9 MW negotiate electricity prices.

These 36/42 plants, with a total capacity of 2,063.7 MW, proposed a temporary electricity price of 50% of the price range as the basis for mobilization. 19 of them with a total capacity of 1,346.82 MW have been approved by the Ministry of Industry and Trade at a temporary price. The rest will be completed for approval by EVN in May.

Of 19 power plants that have agreed on temporary prices, 13 electricity operating licenses were granted, 12 of which are operating at full capacity as planned.

According to the Ministry of Industry and Trade, this is a positive signal that shows the negotiation efforts of the investors and EVN to harmonize the interests of the parties.

However, many investors are still concerned about the electricity price range for wind turbines and transitional solar power plants, which the Ministry of Industry and Commerce issued in Decision No. 21/QD-BCT in early January 2023. They believe this maximum price is 20-30% lower than the 20-year preferential FIT (supportive electricity tariff) that is being offered.

“Some investors of transitional renewable energy power plants consider the renewable energy purchase price range to be lower than expected and therefore do not send documents to negotiate electricity prices with EVN, resulting in longer negotiation time. Judgment and waste of resources,” said the director of the electricity regulator Tran Viet Hoa.

In addition, the race to timely take advantage of investors’ FIT price incentives leads to wasted time in site clearance and construction rush, leading to missed investment costs in many projects. The FIT Preferential Electricity Pricing Mechanism is a supportive electricity pricing mechanism designed to encourage investment in solar and wind power projects, regulated for a specific period of time.

To solve the problem, the Ministry of Industry and Trade has proposed and approved a transitional mechanism for wind and solar energy projects that are in approved planning and have an investment policy until January 26, 2022. The ministry also proposed to the prime minister to allow the investor to negotiate with EVN to determine the purchase price of electricity, provided that it is within the price range set by the ministry and a power purchase agreement has been signed with EVN.

Vietnam is considered to have great potential for wind and solar energy.

Vietnam is considered to have great potential for wind and solar energy.

As of March 20, 2023, more than two months after Resolution No. 21 on Price Range for Electricity Generation from Wind Turbines and Transitional Solar Power Plants came into force, the Electricity Trading Company (EVN) has received only 1 set of documents. from investors.

“This is the time when investors urgently need to complete procedures and submit documents so that the electricity price agreement will not be extended, the time for these projects to be commissioned will be reduced, and the economic problem will be solved step by step. business of companies”, the representative emphasized the Ministry of Industry and Trade.

At present, the national electricity system, especially in the north, is at the peak of the dry season and is in a very difficult situation due to the high system load and low water flow from hydroelectric power plants. Increasing mobilization of available energy sources, including renewable energy transition power plants, is essential.

On May 25, 2023, the Ministry of Industry and Commerce further issued the Official Letter No. 3219/BCT-DTDL-DL on the Implementation of the Notice No. 182/TB-VPCP of May 17, 2023 of the Relevant Government Office for Solar Energy Projects, Transitional wind power projects.

The Ministry of Industry and Trade called on EVN to urgently negotiate temporary prices with investors in solar power plants and transitional wind power plants and to bring electricity into the grid for power generation.

In addition, EVN is working closely with investors to complete relevant legal processes such as the follow-up agreement (if expired) before June 5th; Complete mandatory testing for registered power plants by June 10, verify power plant test results and ensure compliance with technical requirements and associated regulations.

As the transitional power plants have been approved at a temporary price, the Ministry of Industry and Trade is directing EVN to urgently sign power purchase and sale contracts and review procedures for early operation and on-grid generation. For the remaining plants, EVN is urgently negotiating a preliminary price with investors by May 27th, which will be submitted to the Ministry of Industry and Trade for approval.

“The government, ministries and branches always exchange information and accompany investors to remove obstacles and difficulties. In order to bring transition projects for renewable energy into action quickly, it is necessary to work together with investors. Authorities and companies in the spirit of respecting the law.” confirmed the Director of the Electricity Regulatory Authority.

According to the Ministry of Industry and Trade, the maximum price of the power generation price bracket (excluding VAT) applicable to ground solar power plants is VND1,184.90/kWh, while floating solar power is VND1,508.27/kWh. The peak price for inland wind power is VND1,587.12/kWh, and for sea wind power is VND1,815.95/kWh.



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