Fearing bankruptcy, dozens of renewable energy investors send urgent petition

Up to 13 foreign investors and 15 domestic enterprises owning 50 renewable energy projects have signed a petition regarding commercial operations without a written Acceptance of Acceptance for fear of bankruptcy.

Up to 13 foreign investors and 15 domestic enterprises owning 50 renewable energy projects have signed a petition regarding commercial operations without a written Acceptance of Acceptance for fear of bankruptcy.

Problems with commercial operations without acceptance documents

The story stems from Conclusion No. 1027/KL-TTCP of the Government Inspectorate regarding renewable energy projects such as solar power and wind power with Commercial Operation Date (COD), but there is no document of Acceptance of the results of the inspection and acceptance by the competent authority (Acceptance of acceptance) at the time of COD as well as during the period of enjoying preferential electricity purchase prices according to Decision 17/2019/QD-TTg (FIT1 price) and Decision 13/2020/QD-TTG (FIT2 price).

The conclusions stated that the lack of Acceptance Document at the time of the COD renewable energy project and payment from the Vietnam Electricity Group (EVN) caused damage to the state. Here specifically for EVN - a 100% state-owned unit.

To overcome the shortcomings raised by the inspection conclusion, the Minister of Industry and Trade proposed that projects that are enjoying FIT prices that violate the conclusion of the competent authority due to not fully meeting the conditions for enjoying FIT prices will not be entitled to enjoy preferential FIT prices, but must re-determine the electricity purchase and sale prices according to regulations; and recover the preferential FIT prices that have been enjoyed incorrectly through offset payments for electricity purchases.

According to the report of the Ministry of Industry and Trade, there are 173 grid-connected solar and wind power plants/parts of grid-connected solar power plants facing this situation.

The petition mentions that approximately 30% of the affected projects involve foreign investors from Europe (France, Portugal, Spain, Switzerland, the United Kingdom) and Asia (India, Japan, the Philippines, Singapore, Thailand, China).
The total investment value affected in foreign-owned projects alone is estimated at US$4 billion, including more than 3,600 MWp of solar power projects and 160 MW of wind power projects.

The fact that COD solar power plants have to face the reality that they will no longer enjoy the current electricity selling prices of 9.35 US cents/kWh of FIT1 or 7.09 US cents/kWh of FIT2, but will instead enjoy lower prices, even not exceeding the ceiling price of 1,184.9 VND/kWh according to Decision 21/QD-BCT issued in early 2023 for transitional projects, has caused businesses to panic.

Believing that the Acceptance Document for Completion of Construction Works by the Ministry of Industry and Trade or the competent provincial authority is not a prerequisite requirement to achieve COD at the time FIT1 and FIT2 take effect, 13 foreign investors, 14 domestic enterprises and 1 energy industry association jointly signed a collective petition on March 5, 2025 to send to senior leaders and competent authorities.

There are currently nearly 150 concentrated solar power projects operating on the national power grid.

According to this recommendation, despite complying with the renewable energy regulations in effect at that time, since September 2023, many projects have had their payments delayed indefinitely or have only received partial payments under the Power Purchase Agreements (PPAs) signed with EVN, without any clear legal basis other than that mentioned in Inspection Conclusion No. 1027/KL-TTCP.

The financial impact of this situation is severe, with a number of projects already facing default on their debt obligations to domestic and international lenders. If this situation continues or worsens, it could threaten the stability of domestic financial markets and undermine confidence in Vietnam’s legal framework.

Furthermore, the recent proposal to apply COD retroactively, by determining FIT eligibility based on the date of issuance of the Acceptance Letter instead of the original COD date, has raised deep concerns in the investor community.

If implemented, this proposal could result in losses equivalent to nearly 100% of the equity of affected projects, threatening more than US$13 billion in investment and sending a negative signal not only to existing investors but also to potential future investors in Vietnam.

Propose to continue enjoying electricity price as COD initially

The investors' petition stated that at the time these projects were approved for COD, current regulations did not require the Acceptance Document as a condition for COD.

According to Decision No. 39/2018/QD-TTg for wind power projects and Decision No. 13/2020/QD-TTg for solar power projects, the conditions for COD recognition include only 3 requirements: Completing initial testing of the power plant and connection equipment; Being granted a power operation license and Agreeing on meter readings to start payment.

Even the regulations on electricity operation licenses at that time did not require a written Acceptance of Acceptance as a condition for being granted an electricity operation license.

It was not until June 9, 2023 that Circular No. 10/2023/TT-BCT required a Document of Acceptance before applying for an electricity operation license. Therefore, investors believe that retroactively applying this new requirement to projects that have achieved COD many years ago goes against the principle of non-retroactive application of Article 13 of Investment Law No. 61/2020/QH14.

Investors also believe that any violation of Acceptance of Construction Law will only result in administrative sanctions and requirements for remedial action (if applicable), but will not change the fact that the project has met the COD conditions according to the regulations in effect at that time and has obtained COD approval from EVN.

“Under the signed PPAs, EVN is obliged to purchase electricity from these projects at the agreed FIT price from the COD date previously approved by EVN. The delay in payment raises serious concerns about EVN’s compliance with its commitments under these signed PPAs,” the petition said.

The petition also stated that, under these international agreements, Vietnam has committed to ensuring fair legal procedures, protecting and ensuring the safety of investments, and avoiding direct or indirect expropriation or requisition.

Therefore, if implemented in the way proposed by the Ministry of Industry and Trade, it could cause widespread defaults and destabilize the financial market, thereby seriously affecting the consistency of legal regulation in Vietnam.

This instability could cause foreign direct investment flows into the power sector to stagnate, damaging Vietnam’s reputation as an attractive and reliable investment destination.

Furthermore, this could undermine investor confidence in Vietnam’s renewable energy sector and raise concerns about Vietnam’s commitment to its net-zero emissions target.

Investors' recommendations:
- Confirm and enforce the initially approved COD date of affected projects;
- Ensure that EVN fully performs its contractual obligations under signed PPAs with full and timely payment for affected projects, avoiding financial exhaustion for the projects.
- Circular 10/2023/TT-BCT shall not be applied retroactively to projects that have COD before the effective date of this Circular.

Source: https://baodautu.vn/lo-pha-san-hang-chuc-nha-dau-tu-nang-luong-tai-tao-gui-kien-nghi-khan-d251325.html