38 solar and wind power projects are enjoying preferential FIT prices for 20 years, and the Electricity Trading Company has proposed EVN reduce payment by 20-40% after review.
On December 8, the Electricity Trading Company (EPTC) under Vietnam Electricity Group (EVN) sent a document to EVN regarding wind and solar power plants that were accepted by authorities after the commercial operation date (COD).
Accordingly, EPTC said that after reviewing 38 factories, the part of solar and wind power plants that are being paid according to FIT price (ie fixed price for 20 years) has acceptance results from competent authorities from the date of commercial operation (COD) or after this date until the preferential price expires (solar power is June 30, 2019 and December 31, 2020; wind power is October 31, 2021).
Specifically, 15 factories, part of solar power plants are being paid the electricity selling price according to the FIT price of 9.35 cents (about 2,300 VND per kWh); 2 solar power plants are being paid the price of 7.09-7.69 VND per kWh (equivalent to 1,644-1,783 VND per kWh). And 11 wind power plants are being paid by EVN at the price of 8.5-9.8 cents (1,927-2,220 VND) per kWh.
EPTC proposes that while waiting for the conclusion of the competent authority related to the above projects, EVN approves a temporary payment plan for these power plants at a price equal to the ceiling price of the electricity generation price frame of the Ministry of Industry and Trade.
Specifically, solar power is 1,185-1,508 VND per kWh; wind power is 1,587-1,816 VND per kWh. Payment is expected to be applied soonest.
Thus, if approved by EVN, the upcoming provisional payment price of the above projects will decrease by 25-40% for solar power and nearly 20% for wind power.
Mr. Bui Van Thinh, Chairman of Binh Thuan Wind Power Association, said that in the context of Vietnam's strong commitment to the world on energy transition, increasing the proportion of renewable energy sources in the power system to achieve the goal of reducing net emissions to zero, these solutions or proposals "make the business environment in Vietnam's energy sector worse".
According to him, many projects that are able to enjoy the preferential FIT price of 9.35 cents per kWh are not profitable due to low mobilization rates. With this proposal, the price of some projects that are enjoying preferential prices could be reduced by 30-40%, which will put investors in a very difficult position. "They will not have the motivation to reinvest in renewable energy, and foreign enterprises will also be hesitant to invest in renewable energy in Vietnam," he told VnExpress .
In the period 2017-2021, renewable energy (solar power, wind power) developed strongly after the decision to allow investors to enjoy preferential fixed prices for 20 years for projects that were able to operate commercially before the deadline. In 2020, nearly 16,500 MW of solar power was put into operation, more than 19 times the capacity stated in the adjusted Power Plan 7 (850 MW). Currently, the proportion of operating wind and solar power accounts for nearly 27% of the total installed capacity of the entire system.
Vietnam is still determined to strongly develop this type of energy until 2030 and 2050 to achieve the goal of reducing emissions to 0% as committed at COP 26. Accordingly, in the Power Plan VIII approved in May, the capacity of solar power sources is expected to increase by 4,100 MW by 2030, and by 2050 reach 168,594 - 189,294 MW, producing 252.1 - 291.5 billion kWh.
With onshore wind power expected to develop 21,880 MW, offshore wind power is 6,000 MW by 2030 and reaching 70,000-91,500 MW by 2050.
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