Deputy PM requests removing difficulties for renewable energy projects

By Huong Dung
Thu, May 18, 2023 | 4:05 pm GMT+7

Vietnam's Deputy Prime Minister Tran Hong Ha has asked the industry ministry to study a pricing mechanism similar to that applied to build-transfer (BT) transport projects for wind and solar power projects that missed out on preferential feed-in-tariffs.

In his Wednesday conclusion following a meeting with ministries and sectors on measures to remove difficulties for solar and wind power projects, Ha asked the Ministry of Industry and Trade (MoIT) to soon revise regulations and provide specific instructions on price calculation methods for such projects, which are also called transitional projects.

"The pricing mechanism may be similar to that applied to the BT projects in the transport sector, with independent audits and an acceptable profit level to ensure the investment motivation for developers," he said.

A wind farm developed by Trungnam Group in south-central Vietnam's Ninh Thuan provincec. Photo courtesy of Vietnam News Agency.

A wind farm developed by Trungnam Group in south-central Vietnam's Ninh Thuan provincec. Photo courtesy of Vietnam News Agency.

Currently, 84 renewable energy projects with a total capacity of more than 4,600 megawatts have missed deadlines for commercial operation. Of these, 34 transitional projects (28 wind and six solar power) with a total capacity of nearly 2,100 MW have been completed and put into trial run.

These projects do not enjoy FITs for 20 years and have to negotiate electricity prices with state utility Vietnam Electricity (EVN) under an electricity generation price bracket set out by the MoIT earlier this year, with prices 20-30% lower than before.

According to the new price bracket, issued under the MOIT’s Decision 21 dated January 7, 2023, the maximum purchase price for transitional solar power projects is VND1,185-1,508 (5.0-6.4 U.S. cents) per kWh, depending on the type and excluding VAT. Meanwhile, the ceiling price for transitional wind power projects is VND1,587-1,816 per kWh (6.8-7.7 U.S. cents).

However, the investors and state utility EVN recently faced difficulties in price negotiation because there was no detailed guidance on price calculation methods from the MoIT. According to EVN, by mid-May, 31 transitional renewable energy projects had submitted applications for electricity price negotiation, but only half of them provide enough legal documents and are under negotiation.

In addition, only 13 out of 84 transitional projects have electricity generation licenses. Therefore, Deputy Prime Minister Tran Hong Ha asked the MoIT to urge relevant agencies to speed up the issuance of such a license.

EVN added that among the investors that have submitted applications, 16 proposed to apply the temporary prices during the negotiation period. Of them, 10 accept a temporary price equal to 50% of the ceiling price in the bracket set by the MoIT without retroactiveness.

Two others wanted a temporary price equal to 50% of the ceiling price with retroactiveness and the remaining four offered a temporary price equal to 90% of the ceiling price.

Deputy PM Ha requested the MoIT to guide EVN to negotiate temporary prices with investors to enable renewable energy projects to be connected to the grid soon. After negotiation, the projects will be paid with the official prices.

To date, six projects with a total capacity of nearly 358 MW have agreed on temporary electricity prices with EVN.

The 20-year preferential FiTs are 9.35 U.S. cents per kWh (Decision 11/2017) and 7.09-8.38 U.S. cents per kWh (Decision 13/2020) for solar power projects that became operational by December 31, 2020; and 8.35-9.8 U.S. cents per kWh (Decision 39/2018) for wind power projects that became operational by November 1, 2021.

Under the freshly approved power development plan, known as PDP VIII, renewable energy will make up 50.3% of the total capacity generated in Vietnam by 2030 and 70% in 2050.

Comments (0)
  • Read More
Vietnam conglomerate Vingroup’s H1 profit surges 120% on robust real estate, EV performance

Vietnam conglomerate Vingroup’s H1 profit surges 120% on robust real estate, EV performance

Vingroup JSC (HoSE: VIC) reported a consolidated net profit of VND4,509 billion ($172.2 million) in the first half of 2025, up 120% year-on-year, driven by strong performance in real estate and electric vehicle segments.

Companies - Thu, July 31, 2025 | 9:22 pm GMT+7

Vietnam’s tech unicorn VNG returns to profit in Q2 on steady gaming growth

Vietnam’s tech unicorn VNG returns to profit in Q2 on steady gaming growth

Vietnamese tech unicorn VNG Corp (UPCoM: VNZ) returned to the black in the second quarter of 2025, supported by robust gaming revenue and tighter cost management.

Companies - Thu, July 31, 2025 | 8:23 pm GMT+7

Southern Vietnam port partners with Chinese firms to expand logistics network

Southern Vietnam port partners with Chinese firms to expand logistics network

The Long An International Port in the southern province of Tay Ninh on Wednesday signed a cooperation agreement with SPG Bohaiwan Port and Bohwa Shipping Pte Ltd of China to expand its logistics network.

Companies - Thu, July 31, 2025 | 2:51 pm GMT+7

Consortium proposes $850 mln energy storage battery plant in southern Vietnam

Consortium proposes $850 mln energy storage battery plant in southern Vietnam

A consortium of five international and Vietnamese companies has proposed investing in an energy storage battery plant in the Ho Chi Minh City-based Saigon High-Tech Park (SHTP), with total investment capital of $850 million.

Industries - Thu, July 31, 2025 | 2:35 pm GMT+7

World-class talent ‘absolutely central’ to success of Vietnam's international financial center ambition: Tony Blair Institute

World-class talent ‘absolutely central’ to success of Vietnam's international financial center ambition: Tony Blair Institute

Damian Hickey, regional director, South East Asia, Tony Blair Institute talks with The Investor on international investors’ interest in Vietnam’s dual-campus international financial center (IFC) model and suggests ways to attract world-class talent for the country’s IFC ambition.

Finance - Thu, July 31, 2025 | 10:53 am GMT+7

Vietnam retail major FPT Retail’s accumulated profit jumps by over $36 mln in H1

Vietnam retail major FPT Retail’s accumulated profit jumps by over $36 mln in H1

Vietnamese retail major FPT Retail’s undistributed post-tax profit rose nearly 2.7 times to VND1.5 trillion ($57.16 million) at the end of June, up VND955 billion ($36.39 million) from the beginning of this year.

Companies - Thu, July 31, 2025 | 10:00 am GMT+7

Super typhoon verifies claim management excellence of Vietnam’s leading insurer

Super typhoon verifies claim management excellence of Vietnam’s leading insurer

PVI Insurance Corporation winning the “Outstanding Claims Management” category at the Country Awards for Excellence 2025 hosted by Insurance Asia News (Hong Kong) affirms its strong service quality, not only within Vietnam but also in the broader regional insurance community.

Companies - Thu, July 31, 2025 | 9:03 am GMT+7

New sellers on Amazon must seriously invest in branding: Lixibox exec

New sellers on Amazon must seriously invest in branding: Lixibox exec

New sellers on Amazon should be prepared to invest in their business and view early mistakes as inevitable learning experiences, not reasons to quit, said Sao Lonsdale, CEO of Lixibox, a Vietnamese beauty brand.

Companies - Thu, July 31, 2025 | 9:00 am GMT+7

MBBank records 18% profit growth in H1, among top earners in Vietnam's banking system

MBBank records 18% profit growth in H1, among top earners in Vietnam's banking system

Hanoi-based MBBank (MB) posted a pre-tax profit of VND15.89 trillion ($606.43 million) in H1/2025, up 18% from a year earlier and meeting half of its full-year target.

Banking - Thu, July 31, 2025 | 8:06 am GMT+7

Vietnam's leading developer Novaland divests from series of major projects

Vietnam's leading developer Novaland divests from series of major projects

Novaland, a major real estate developer in Vietnam, said it had completed the transfer of a 49% stake in its subsidiary Gia Duc Real Estate Co. Ltd., in a deal worth nearly VND1.73 trillion ($65.98 million) in June.

Real Estate - Thu, July 31, 2025 | 8:00 am GMT+7

Two Vingroup subsidiaries to sign $180 mln contractor for commercial complex in Hanoi

Two Vingroup subsidiaries to sign $180 mln contractor for commercial complex in Hanoi

Vietnam Exhibition Fair Center JSC (VEFAC), a unit of conglomerate Vingroup (HoSE: VIC), has secured board approval to sign a contractor agreement with fellow subsidiary Vincons Construction Investment and Development JSC to develop a cultural, service and commercial complex in Hanoi’s Giang Vo ward.

Real Estate - Wed, July 30, 2025 | 4:29 pm GMT+7

Vietnam's state utility EVN posts $314 mln in post-tax profit after long period of losses

Vietnam's state utility EVN posts $314 mln in post-tax profit after long period of losses

State-owned giant Vietnam Electricity (EVN) made a remarkable turnaround in 2024, recording a post-tax profit of more than VND8.24 trillion ($314.2 million), ending a prolonged period of losses.

Companies - Wed, July 30, 2025 | 2:03 pm GMT+7

Masan’s beverage chain Phuc Long books nearly 64% profit growth on strong food sales

Masan’s beverage chain Phuc Long books nearly 64% profit growth on strong food sales

Phuc Long Heritage JSC, a beverage subsidiary of retail giant Masan Group (HoSE: MSN), posted a net profit of VND86 billion ($3.28 million) in the first half of this year, up 63.5% year-on-year, according to its parent firm’s financial statement.

Companies - Wed, July 30, 2025 | 1:51 pm GMT+7

Vietnam's pharma major Bidiphar achieves 60% of year's profit target after 6 months

Vietnam's pharma major Bidiphar achieves 60% of year's profit target after 6 months

Binh Dinh Pharmaceutical Medical Equipment JSC (Bidiphar) reported revenue of VND916 billion ($34.98 million) and pre-tax profit of VND202 billion ($7.71 million) in H1/2025, fulfilling 46% and 60% of the year's respective targets.

Companies - Wed, July 30, 2025 | 11:36 am GMT+7

Vietnam earns $3.7 bln from steel exports in H1, down 22.5%

Vietnam earns $3.7 bln from steel exports in H1, down 22.5%

Vietnam raked in $3.7 billion from exporting 5.66 million tons of steel in the first half of 2025, down 13% in volume and 22.5% in value year-on-year.

Economy - Wed, July 30, 2025 | 10:30 am GMT+7

Challenges mount for Vietnam’s Century Synthetic Fiber Corporation

Challenges mount for Vietnam’s Century Synthetic Fiber Corporation

Ho Chi Minh City-based Century Synthetic Fiber Corporation is facing a myriad of difficulties as it has failed to raise capital, while hundreds of billions of VND (VND100 billion = $3.82 million) in project-related debt near maturity.

Companies - Wed, July 30, 2025 | 9:11 am GMT+7