The Hanoitimes - Investors would benefit from incentives in 20 years if their solar farms are connected to the national grid before the deadline.
Domestic and foreign solar power developers in Vietnam are in a hurry to connect to the national grid before the end of June in order to benefit from incentives in a 20-year period isued by the government.
The solar power plants nationwide are finalizing procedures and completing facilities to generate electricity following the prime minister’s decision which requires the Electricity of Vietnam (EVN) to buy all the solar power generated by the plants commencing commercial operations before June 30.
A solar farm. Photo: Landmarkdividend
According to EVN, nearly 100 investors are trying to reach the commercial operation date (COD) before the deadline when the sellers can start producing electricity for sale, the Tin Tuc newspaper reported.
Under Decision 11/2017/QD-TTg dated April 11, 2017 on incentives for solar power projects in Vietnam, projects connected to the national grid from June 1, 2017 to June 30, 2019 would be eligible to sell energy to EVN at VND2,086 (9.35 US cent/kWh) excluding value added tax (VAT) and adjustable to the Vietnam dong-US dollar exchange rate.
The selling price is high compared to other types of power.
Hanoi-based BIM Energy Joint Stock Company is running against the clock to get ready for the grid connection of its three projects namely BIM 1, BIM 2, and BIM 3 in Thuan Nam district of the central province of Ninh Thuan.
Kicked off in January 2018, the projects have had their construction completed 100%, 97%, and 95%, respectively. And the investor targets to make the completion by the deadline.
Nguyen Phuong Trung, project coordinator of BIM Energy JSC, said that the 250-MW BIM 2 project will be connected to the national grid by end-April while BIM 3 project may be put into operation prior to June.
The 46-MW Solar 1 project of BP Solar JSC in Ninh Phuoc district of Ninh Thuan province with an investment of VND1.3 trillion (US$57 million) has been connected to the grid.
Meanwhile, Gia Lai Electricity JSC said that its two solar power plants with total capacity of 98MW in the provinces of Long An and Binh Thuan would become operational before June 30 to enjoy the pretty high prices.
According to Bui Van Thinh, general director of Thuan Binh Wind Power JSC, the price of 9.35 US cent/kWh of solar power is competitive, and encourages many investors to develop projects.
Statistics by the Ministry of Industry and Trade (MOIT) showed that at the end of 2018, there were 121 solar power projects with total capacity of 6,100MW added to the national power master plan by 2020, compared to 850MW by 2020 approved earlier by the prime minister. The target capacity by 2030 would reach 12,000MW.
Ratio of solar power in Vietnam's renewable energy. Photo: Vietnam's Electricity and Renewable Energy Authority
Localities having great potential of solar power include the central provinces of Ninh Thuan and Binh Thuan, and the southern provinces of Tay Ninh, Binh Duong, Binh Phuoc, Long An, and Ba Ria-Vung Tau, according to the MOIT’s Institute of Energy.
Tran Viet Ngai, head of the Vietnam Energy Association, said that the government’s incentives in solar power development has resulted in massive construction of solar projects, causing an overload on the electricity grid, or even grid collapse.