EVN asked to follow solar power purchase contract signed with Trungnam Group

State-run utility Vietnam Electricity (EVN) has been requested to follow the solar power purchase contract signed with Trungnam Group in line with relevant legal regulations.

The request was made by the Electricity and Renewable Energy Authority (EREA) under the Ministry of Industry and Trade in response to directions by Deputy Prime Minister Le Van Thanh at a recent meeting on the matter.

From September 1, EVN stopped purchasing 172.12 megawatts from the Trung Nam-Thuan Nam solar power plant's 450 MW capacity, saying this portion is yet to have a pricing mechanism.

Trungnam then sent a petition to the government, claiming that slashing 40% of the Ninh Thuan province-based project’s capacity would mean severe losses.

“It will break the investor’s commitment on the financial plan approved by credit institutions, leading to the project’s inability to repay loans.

“On the other hand, cutting the utilization of power capacity without a pricing mechanism runs counter to the provisions in the power purchase agreement signed between Trungnam and EVN,” the group wrote.

Details of the contract between the two sides are not disclosed.

At a government press briefing earlier this month, Deputy Minister of Industry and Trade Do Thang Hai said Trungnam Group has "shortcomings" as it has not completed documents for appraising and approving the 172 MW capacity portion in line with the law. EVN did purchase the portion and put it into the power grid, but it is yet to have a pricing mechanism.

“Trung Nam needs to coordinate with relevant authorities to complete documents in line with the laws,” he added.

Previously, EVN and Trungnam Group had held talks on solutions for the power purchase deadlock during which the state utility asked Trungnam to put the 172-MW portion into the “competitive power generation market”.

At the meeting, the Deputy PM asked the Ministry of Industry and Trade to review and thoroughly handle all petitions by the Trung Nam-Thuan Nam solar power plant, ensuring all are done in line with the laws.

“The handling process needs to factor in all issues related to Trungnam’s investment in constructing the solar power plant in association with the 500kV transmission line that other power suppliers in the region are connected to, the power purchase agreement between the parties, and the certificate recognizing the plant’s commercial operation granted by competent authorities,” he said.