Ceiling prices for solar, wind power set

According to the ministry’s decision issued Saturday, the ceiling price excluding value-added tax will be applied to solar power and wind power projects which have become operational after incentivized feed-in-tariff (FIT) price policies expired in late 2020 and late 2021.

National utility firm Vietnam Electricity (EVN) will use the ceiling price as a base when it negotiates with investors in renewable energy projects to buy electricity from their power plants.

In November 2022, EVN proposed solar power prices ranging from nearly VND1,188 to VND1,570 per kWh, and wind power prices of some VND1,591-1,945 per kWh.

The price bracket set by the ministry is lower than that proposed by EVN. By the end of last year, operational wind and solar power projects had accounted for nearly 27% of the total installed capacity of the whole system, including 16,545 MW of ground- and roof-mounted solar power and 4,126 MW of wind power.

The 20-year FIT price for solar power projects was 9.35 cents per kWh and 7.09-8.38 cents per kWh; and for wind power projects 8.35-9.8 cents per kWh. These preferential prices for solar power expired on December 31, 2020, and for wind power on November 1, 2021.

After the FIT price expired, five solar power projects or parts of projects with combined capacity of over 452 MW who waited for new prices, and 62 wind power projects with total capacity of nearly 3,480 MW, signed electricity sales contracts with EVN. Some other renewable energy projects are under implementation.

According to Ha Dang Son, director of the Center for Energy and Green Growth Research, a nonprofit research organization, the ceiling price set by the ministry may not be as high as expected by renewable energy investors that failed to become operational earlier to enjoy the FIT policy.

But he said it helps them sell electricity and earn income after over two years of being dormant.