1. Describe any customs or habits that are features of doing business in the renewable energy industry? Likewise describe any customs or habits that are features of doing business in Vietnam. Explain how these customs or habits are used?
Build and maintain relationship with Government officials at all levels (central, provincial) is a must. Meetings can be formal or sometimes invite them out for lunch/ dinner with small gifts (but not too expensive). Do not go into too much details of your project or investment plan in the initial meeting. Save it for the next meetings. The first one should only be for “getting to know each other” purpose.
Vietnam has a consensus-driven system, meaning everyone has to say something. Any person has veto right. Thus, to make sure that a decision in favor of your investment is made, you have to gain support of every person who has the decision-making right. In addition, decision making process in Vietnam has to go through many levels and thus takes quite long. Be patient then.
You should always set up a meeting some weeks in advance. Although some officials are able to communicate in English, it is advised to have a translator/ interpreter.
2. In your opinion, who are the ‘big players’ within the renewable energy industry within Vietnam?
This applies to private companies, national companies, government departments etc.
EVN as the sole off-taker and its generation companies are the main players in the sector. Besides, the General Department of Energy, the Electricity Regulatory of Vietnam (both under the Ministry of Industry and Trade) play an important role in setting regulatory framework.
3. Explain any rules or laws that dictate how you must operate within the renewable energy industry and within Vietnam.
Wind: Decision No. 37/2011/QD-TTg, Circular No. 32/2012/TT-BCT
Biomass: Decision 24/2014/QD-TTg, Circular 44/2015/TT-BCT
Solid-waste power: Decision 31/2014/QD-TTg, Circular 32/2015/TT-BCT
Solar: Decision 11/2017/QD-TTg, Circular guiding the Decision and promulgating the PPA is being drafted
There are a number of laws and documents regulating an investment in Vietnam. I just name some major laws: Investment Law, Enterprise Law, Labor Law, Commercial Law, Civil Code, etc.
4. In your opinion, to what extent does a hierarchy exist within the renewable energy industry in Vietnam?
The development of renewable energy industry does not catch up with economic development speed. Although the Government has set out the increasing role of this sector in the energy development plan, I am afraid that the Government may fail to meet its target due to lack of support policies and bankable PPAs.
5. Describe the main changes that have occurred to the renewable energy industry in Vietnam in the last 10 years.
The renewable industry in Vietnam is very young. Indeed, it only started developing since the adoption of the Wind Decision in 2011. Following that Decision, the Prime Minister continued completing the legal framework for the sector by introducing Biomass Decision and Solid-Waste Decision in 2014, and the latest Decision being the Solar Decision issued in April 2017. The adoption of these policies was the joint effort of many relevant ministries, including the General Director of Energy under the Ministry of Industry and Trade, which was established at the end of 2011 to improve state management in the sector.
In 2009, the first factory producing solar panels with total investment of USD10 million came into operation in Vietnam. Later in 2010, GE Energy invested USD61 million to establish the first factory producing wind turbines in Hai Duong. This was considered as a boost for the renewable energy market. However, by 2015, renewable energy only accounted for 5% in the total energy output, in which there is no wind and solar power but only small hydro power.
FYI, the first wind power plant came into operation in 2012 in Binh Thuan with a capacity of 30 MW. Recently, the first solar plant in Dong Thap also commenced ts operation.