Build a price frame according to regulations
In this report, the Ministry of Industry and Trade said that regarding the development of Circular 15/2022/TT-BCT regulating the method of determining the electricity generation price framework for transitional solar and wind power plant projects, the Ministry of Industry and Trade said that it had received 30 written comments on the draft Circular.
"Most opinions agree on the content of the draft circular. Regarding the contents with different opinions, the Ministry of Industry and Trade has accepted to amend and supplement the draft circular before officially issuing it," the Ministry of Industry and Trade stated.
In the report, with the opinion that the electricity generation price frame of these projects is "too low", the Ministry of Industry and Trade said that the ground-mounted solar power plant has a ceiling price of 1,184.90 VND/kWh; floating solar power plant is 1,508.27 VND/kWh; onshore wind power plant is 1,587.12 VND/kWh; offshore wind power plant is 1,815.95 VND/kWh.
Pursuant to Circular 15, the Ministry of Industry and Trade has appraised the electricity generation price framework for transitional projects submitted by Vietnam Electricity Group (EVN).
In particular, regarding investment rate data, the Ministry of Industry and Trade has considered the reduction in investment rates for solar and wind power projects in the 2018-2021 period (based on data in the report of the International Renewable Energy Agency - IRENA).
Specifically, the investment rate for grid-connected solar power projects in the 2018-2021 period decreased by an average of 11% per year, and the investment rate for grid-connected onshore wind power projects decreased by an average of 6.3% per year.
The results of the electricity generation price framework in Decision 21 show an average decrease of 7.3%/year for ground-mounted solar power, 4.2%/year for floating solar power compared to the preferential price FIT 2 (issued in 2020); an average decrease of 4.19%/year for onshore wind power, 4.3%/year for offshore wind power compared to the price FIT 2 (issued in 2018).
"During the appraisal process, the Ministry of Industry and Trade consulted with the Ministry of Finance, the State Capital Management Committee at Enterprises and held an Advisory Council meeting on the results of the appraisal of the price framework," said the Ministry of Industry and Trade.
Therefore, the Ministry affirms that the issuance of Circular 15 is within the authority prescribed in the Electricity Law, the Price Law and guiding decrees.
The electricity price framework for transitional projects has also been calculated by EVN and appraised by the Ministry of Industry and Trade, issued in Decision 21/QD-BCT in accordance with the method in Circular 15, with reference to data from consulting organizations, in accordance with current socio-economic conditions.
The Ministry of Industry and Trade said it will continue to coordinate with relevant agencies and units to review the price framework for transitional projects and promptly edit and supplement if any problems or inadequacies are discovered.
There are still many projects that do not have enough procedures.
According to a report from the Ministry of Industry and Trade, there are currently 85 transitional renewable energy projects nationwide. Of these, 77 are wind power plants with a total capacity of 4,185.4 MW and 8 are solar power plants with a total capacity of 506.66 MW.
Updating the progress of price negotiations for these projects, according to the Ministry of Industry and Trade, as of August 25, 79/85 transitional projects with a total capacity of 4,449.86 MW (accounting for 94%) have submitted documents to EVN.
Of these, 68 projects with a total capacity of 3,633.26 MW have agreed on prices with EVN.
There are 67 project investors who have agreed to apply temporary electricity prices (equal to 50% of the ceiling price of the price frame according to Decision 21). Of these, 61 projects have agreed on temporary prices and have temporarily submitted them to the Ministry of Industry and Trade, and 58 projects have been approved. Of these, 20 projects (with a total capacity of 1,171.72 MW) have been recognized for commercial operation.
Regarding legal procedures, 29/85 transitional projects have been granted electricity operation licenses; of which 20 projects were granted full project licenses; 9 projects were granted partial project licenses.
In addition, 11 projects have submitted applications and are being reviewed and inspected by the Ministry of Industry and Trade for licensing; 45 projects have not yet submitted applications for licensing.
EVN said that many transitional projects have not yet received approval to adjust the province's investment policy (according to the provisions of the Investment Law) and have not completed land procedures and other requirements for investment and construction.
These regulations are the conditions for the amended and supplemented power purchase contract on the application of temporary electricity prices between EVN and transitional projects to take effect.
"Therefore, up to now, only 20 transitional projects have had their prices temporarily approved by the Ministry of Industry and Trade and have been recognized for commercial operation date," the Ministry of Industry and Trade analyzed.
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