Vietnam's Ministry of Industry and Trade has approved temporary prices for 19 solar and wind power projects with a total capacity of 1,347 megawatts that missed out on preferential feed-in-tariffs (FiTs).
Known as transitional projects, they are among 24 renewable power projects that have accepted temporary prices equal to 50% of the ceiling levels set in a new electricity generation price bracket under Decision 21 issued on January 7, 2023, the ministry (MoIT) said in a meeting on Wednesday.
According to the new price bracket, 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).
At the meeting to discuss removing obstacles facing transitional renewable power projects, investors said they are working with state utility Vietnam Electricity (EVN) to accelerate the signing of power purchase agreements (PPA) and testing for commercial operation dates (COD).
Once these steps are completed, the power system will have an additional 1,347 megawatts from transitional renewable power projects, easing supply difficulties.
The 19 projects include 14 wind power plants, namely Nam Binh 1, VPL Ben Tre, Yang Trung, Cho Long, Hung Hai Gia Lai, Lac Hoa 2, Hoa Dong 2, Vien An, Hanbaram, Huong Hiep 1, Tan Phu Dong, Hiep Thanh, Ia Le 1 and Huong Linh 7; and five solar power plants Phu My 1, Phu My 3, Thien Tan 1.2, Thien Tan 1.3 and another in Phuoc Minh commune, Thuan Nam district, Ninh Thuan province.
By Wednesday, 13 other transitional projects had submitted their applications to EVN’s Electricity Power Trading Company (EVN-EPTC) for price negotiations and PPA signing.
However, there are still 48 projects that have not submitted their applications. EVN-EPTC has urged these developers to provide related documents for price negotiations.
Last week, Deputy Prime Minister Tran Hong Ha asked the MoIT to revise regulations and provide specific instructions on price calculation methods for transitional wind and solar power projects.
In a document sent to the MoIT on Tuesday, a group of 23 transitional project developers claimed negotiations still faced obstacles due to a lack of guidance from the ministry.
Eighty-four renewable energy projects with a total capacity of more than 4,600 MW have missed deadlines for commercial operations. 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 on trial runs.
These projects will not enjoy FiTs for 20 years as they missed out on the government's power generation deadline and have to negotiate prices with EVN at 20-30% lower than the FiTs.
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.