The New Regulation On Tariffs Of Wind Power Projects

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The New Regulation On Tariffs Of Wind Power Projects

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VLC Energy News - September 2018

New regulation on tariffs of wind power projects came in to force 

The Prime Minister of Vietnamese Government has issued the Decision No 39/2018/QĐ-TTg dated 10/9/2018 for adjusting and supplementing a number of articles of the Decision No 37/2011/QĐ-TTg dated 29/6/2011 on the policy to support the development of wind power projects in Vietnam.

The Decision regulates that the buyer is responsible to buy all electricity from the wind power projects at the  point of electricity delivery with the new tariff as follows:
  • The tariff of 1,928 VND/kWh (equivalent to 8.5 UScent/kWh) for on-shore wind power projects
  • The tariff of 2,223 VND/kWh (equivalent to 9.8 UScent/kWh) for off-shore wind power projects

This is the tariffs excluding VAT with the average exchange rate as 22,683 VND/1USD announced by Vietnamese State Bank at 30/8/2018 and adjusted by the fluctuation of exchange rate  VND/USD. The cost of purchasing electricity from wind power projects is calculated and included in the input parameters of the electricity price scheme of the Electricity of Vietnam.

The above electricity tariffs are applied to a part or whole of the grid connected wind power projects with commercial operation date before 1 November 2021 for 20 years from the date of commercial operation. For the wind power projects commercially operated prior to issuing Decision No. 39/2018/QD-TTg dated 10/9/2018 the above electricity tariffs will be applied  from 1 November 2018 for the remaining period of signed PPA.

The wind power projects have been applied for these electricity tariffs will be not subject to the price mechanism applicable to the electricity generation of the project according to other current regulations.

Besides, Decision No. 39/2018/QD-TTg also amended the conditions for starting construction of wind power, accordingly, the investors are only allowed to start construction of wind power projects when they meet the conditions for project construction start in accordance with the law on construction, and have the PPA signed with electricity Buyer and grid connection agreement with a Power Distribution or Power Transmission company, and wind data report for a continuous period of minimum 12 months.

Source: Vietnam Government Portal - MoIT
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