THE MOIT' REPORT ON PRICE NEGOTIATION FOR SOLAR AND WIND POWER PROJECTS

Yesterday, the Ministry of Industry and Trade issued the Report No. 147/BC-BCT to the Prime Minister and Deputy Prime Minister regarding the implementation of the Deputy Prime Minister's directives in terms of price negotiations for solar and transitional wind power projects.

Spotlights of the Report will be shown below:

1. The Ministry of Industry and Trade (MOIT) reported that it has guided and directed EVN to urgently coordinate with investors to reach a mutually agreed electricity price, ensuring it does not exceed the framework set in Decision No. 21/QD-BCT.

2. As of the end of August 25, 2923, the negotiation and mobilization status of 85 transition projects is as follows:

- Out of the 85 transition projects, 79 have submitted their documents to EVN, while the remaining 6 projects have yet to send their negotiation documents, despite several reminders from EVN.

- Among the projects that have submitted their documents:

+ 68 projects have successfully negotiated electricity prices with EVN.

+ Among the 68 projects, 67 have proceeded to negotiate temporary electricity prices at 50% of the electricity selling price as the basis for signing power purchase agreements and commercial operation.

+ Out of these 67 projects, 61 have reached an agreement on temporary electricity prices with both EVN and the investors, and 58 of these projects have been approved.

+ Currently, 43 out of the 61 projects are in the testing phase, and 20 of them have been officially recognized as having commenced commercial operation.

- Out of the 85 transmission projects, 29 have been granted electricity operation licenses.

3. Regarding the electricity pricing framework for transmission projects

- In order to address the difficulties faced by solar and wind power plants in applying the FIT prices as per the government's regulations, Circular No. 15/2022/TT-BCT was formulated and issued. This circular outlines the methodology for determining electricity pricing.

- In Decision No. 21/QD-BCT, the MOIT reviewed the electricity pricing framework proposed by EVN. As a result, the electricity pricing framework has been reduced for most types of energy sources.

At the end of the document, the MOIT included two appendices that provide detailed information on the issuance process of Circular No. 15/2022/TT-BCT and the electricity pricing framework as stipulated in Decision No. 21/QD-BCT.

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For more information, please contact:

Hoang Pham (James) / Managing Partner at: hoang.pham@vselawyers.com

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