Decision 11/2017/QD-TTg is the first solar policy in Vietnam to introduce feed-in-tariff of 9.35 UScent/kwh to support solar energy development in the country. It introduces a 20 years purchasing agreement with EVN (solar PPA). Furthermore, it provides a simple procedure for rooftop solar and detailed procedure for ground mount solar park development. For more, see below details.
Prime Minister Decision No. 11/2017/QD-TTg on the Mechanism for Encouragement of the Development of Solar Power Projects in Vietnam. The solar policy allows investor develop solar power projects and guarantees any surplus energy production from solar power system will be bought by EVN at the FIT rate for a duration of 20 years. This is great for investors to safeguard the investment and be paid in full for surplus energy. For details of mechanism, refer to Key Takeaways.
|2017||2,086 đ/kwh||Decision 11/2017/QD-TTg|
|2018||2,135 đ/kwh||Circular No.05/2019/TT-BCT|
PPA under Decision 11 is a 20 year contract with FIT price fixed to 9.35 UScent/kwh. But its equivalent VND price of 2,086 đ/kwh follows exchange rate on the first day of each year. Here are the following yearly price updates.
1/ COD: 2019.06.31. Must complete installation and have successfully registered before this date to be eligible for FIT.
2/ 20 Years EVN PPA duration.
3/ Technical requirements:
4/ FIT rate: 9.35 UScent/kwh. 2086 đ/kwh following exchange rate of 22316 đ/usd to be adjusted yearly based on VND-USD exchange rate.
THE PRIME MINISTER
SOCIALIST REPUBLIC OF VIETNAM
Hanoi, 11 April , 2017
ON MECHANISM FOR ENCOURAGEMENT OF DEVELOPMENT OF SOLAR POWER IN VIETNAM
Pursuant to the Law on organization of Government dated 19 June, 2015
Pursuant to the Electricity Law dated November 03, 2004; The law amending the Law on Electricity dated November 20, 2012;
Pursuant to the Law on Investment dated November 26, 2014
Pursuant to the Law on Construction dated June 18, 2014
At the request of the Minister of Industry and Trade;
The Prime Minister promulgates the Decision on mechanism on encouragement of solar power development of Vietnam
Article 1. Scope
This Decision deals with mechanism for encouragement of development of solar power of Vietnam
Article 2. Regulated entities
This Decision applies to organization and individuals involved in developing solar power projects in Vietnam and other relevant organization and individuals
Article 3. Definitions
In this Decision, these terms are construed as follows:
PLANNING AND INVESTMENT OF SOLAR POWER PROJECTS
Article 4. Solar power development plans
Article 5. Preparation, approval and publishing of solar power development plans
– Potentials for solar power of provinces;
– List of solar power projects
– Plan for connection solar power projects to national power grid.
– Potentials for solar power of the province;
– Areas and boundaries of solar power projects;
– List of solar power projects
– Output power of each solar power projects and plan for connection to national power grid.
Article 6. Funding for preparation of solar power development plans.
Article 7. Investment in solar power projects
The rooftops or buildings structure to which solar panels are mounted must be able to hold the weight of the solar panels and other attached accessories.
Electric safety is ensured in accordance with effective law.
The surroundings and environment are protected.
Article 8. Connecting solar power projects to national power grid.
MECHANISM ON ENCOURAGEMENT OF DEVELOPMENT OF SOLAR POWER PROJECTS
Article 9. Responsibility for buying electricity from solar power projects
Article 10. Tax and investment incentives
Article 11. Land incentives
Article 12. Feed in Tariff
The buyer has the responsibility to purchase all generated energy from grid-connected projects at 2,086VND/kWh (excluding VAT, equivalent to 9.35 Uscents/ KWh, according to the exchange rate between VND and USD by the State Bank of Vietnam announced on 10 April 2017 which is 22,316 VND/USD) The price is adjusted to the exchange rate between VND and USD. This price is only applicable to grid-connected projects with the efficiency of solar cells greater than 16% or efficiency of the module greater than 15%.
The electricity purchase price applied to grid-connected projects shall be adjusted to the exchange rate of VND/USD in accordance with model power purchase contract promulgated by Ministry of Industry and Trade
Rooftop projects shall be implemented in net-metering with two-way electricity meters. In a trading cycle, if the amount of electricity generated from rooftop projects is greater than the consumed amount, the surplus will be carry forward to the next trading cycle. At the end of the year or when the contract is terminated, the surplus amount of energy will be sold to the buyer at the price specified in Clause 1 of this Article.
Annually, according to the previous year’s latest exchange rate between VND and USD announced by the State bank of Vietnam, the Ministry of Industry and Trade shall impose prices for rooftop solar power for the following year.
Article 13. Responsibilities of regulatory bodies
Provide instructions and cooperate with People’s Committees of provinces to supervise the implementation of this Decision.
Promulgate the model power purchase contract for rooftop projects and grid-connected projects and provide instructions on the implementation of this model contract.
Promulgate the method of calculating loss on grid in the cases where the measurement point does not coincide with the connecting point.
Promulgate technical regulations on solar power, regulations on measurement of energy of solar power projects and provide instructions on the connection, installation of electricity meters and the calculation of net-metering mechanism applied to rooftop solar power project.
Research the process for bidding for execution of solar power projects and apply it with an appropriate roadmap to improve efficiency and reduce the costs of solar power projects.
Propose a mechanism for encouragement of development of solar power applicable after 30 June, 2019.
Cooperate with People’s Committees of provinces to reach an agreement on land area dedicated to development of solar power projects, ensure the punctuality of the projects according to the approved plan.
Impose prices for solar power projects in accordance with the exchange rate between VND and USD for the following year.
Regarding solar power projects that are not included in any solar power development plan or electricity development plan that has been approved, the Ministry of Industry and Trade shall consider including them in the plan provided their capacity does not exceed 50 MW; request to Prime Minister to consider approving the addition of such solar power projects whose capacity exceed 50 MW in the plan.
Take charge and cooperate with the ministries in formulating policies on encouraging investment and production of solar power equipment in Vietnam and submit them to the Prime Minister for approval.
Consider amending regulations on exemption of taxes and fees incurred by rooftop projects (the nameplate capacity of which must not exceed 50kW) and submit them to competent authorities for approval.
Cooperate with and assist investors in terms of compensation, ground clearance, infrastructure, human resources for investment and execution of solar power projects in their provinces.
Prepare land areas for solar power projects and include them in their land use plans and publish information thereon.
Monitor and supervise the execution of solar power projects in their provinces.
Perform the tasks of state management on activities involved solar power in the provinces in accordance with effective regulations.
Before January 31 annually, People’s Committees of provinces shall report the total amount of nameplate capacity of grid-connected projects and rooftop projects built in their provinces as of December 31 of the previous year to the Ministry of Industry and Trade.
Article 14. Responsibilities of relevant organization and individuals
Negotiate and sign electricity purchase contracts with the seller in accordance with the model electricity purchase contract and electricity prices specified in Article 12 of this Decision if the seller satisfies the conditions for investment in solar power projects specified in Article 7 of this Decision.
EVN is responsible for calculating the full cost incurred in connection with purchasing energy from solar power project and including such price in the input parameters of the electricity pricing scheme of EVN and submit them to competent authorities for approval.
Before January 31 annually, Vietnam Electricity Group shall report the total amount of nameplate capacity of grid-connected projects and rooftop projects built in their provinces as of December 31 of the previous year to the Ministry of Industry and Trade.
Negotiate and sign electricity purchase contract with the buyer in accordance with the model electricity purchase contract and electricity price specified in Article 12 of this Decision.
Install the electricity meters in accordance with effective regulations on measuring consumed energy to prepare electricity bills.
Send 01 copy of the signed electricity purchase contract for execution of the grid-connected project to the Ministry of Industry and Trade within 30 days from the day on which it is signed.
Comply with regulations and law on operating the electricity system, the electricity transmission system, the electricity distribution system, the metering system and other relevant regulations promulgated by the Ministry of Industry and Trade.
Article 15. Transition clause
For grid-connected projects and rooftop projects, the contracts for which are signed before the effective date of this Decision, the parties are responsible for signing contract revisions in accordance with this Decision.
Article 16. Effect
CT TNHH Suntiki Solar is a solar energy company based in Vietnam. We consult, survey, engineer and install rooftop solar panel systems for residential, commercial, industrial such as factories, farms, villas, industrial parks and others.