Following the recent issuance of Decision No. 111 and Circular No. 162 as the key regulations on solar power in Vietnam, in order to promote foreign participation in renewable energy development, a number of provincial authorities in Vietnam have started developing specific guidelines for renewable power projects under their management. In addition to formulating master plans for renewable power projects in their provinces including newly approved projects proposed by various investors, certain provinces in Vietnam have adopted specific rules regulating the criteria for selection of solar power projects to be developed in their respective jurisdictions.
Provincial-level Master Plans
For solar energy, a number of provinces have recently started developing their own provincial-level solar power development plans (e.g., Ninh Thuan, Binh Thuan, Binh Dinh, Binh Phuoc).
Previously, for wind power, the Ministry of Industry and Trade ("MOIT") has approved wind power development plans for a number of provinces (e.g., Quang Tri, Ninh Thuan, Binh Thuan, Ben Tre, Tra Vinh, Soc Trang, Bac Lieu, Ca Mau).
Provincial-level Rules on Selection of Investors
In furtherance of the general regulations of the Government of Vietnam and the MOIT, in certain provinces, the People's Committees have regulated the criteria and conditions for the selection of investors for renewable power projects in their provinces. Some of them include stricter requirements compared to the general regulations issued by the MOIT under Circular No. 16. There are also certain variations among different provinces on how they will incentivize renewable energy investments.
For example, in Thua Thien Hue Province, the People's Committee of the province has recently issued Decision No. 23933 to regulate grid-connected solar power projects with installed capacity of 3MW or more. Decision No. 2393 specifies that in case where there are more than one (1) investor interested in the same project site for developing a solar project, the provincial authorities will organize the selection of investors. Decision No. 2393 sets out specific conditions for a qualified investor, as well as the criteria that the provincial authorities will consider and rate on each investor, including: legal capacity/presence in that province, proposed land use density, financial and technical capacity and experience, technology and equipment proposed to be used, social and economic effects, and progress of project implementation. Among the participating investors, the investor that gets the highest score shall be selected for development of the relevant project. Under Decision No. 2393, if more than one (1) investor get the same score, the authorities will prioritize to select the investor based on the energy efficiency and the technology proposed to be used.
In Ninh Thuan Province, earlier this year, the People's Committee of Ninh Thuan Province issued Decision No. 164 which requires, among other things, that:
- the solar developer must commence construction of a solar project no longer than one (1) year from the date of issuance of the Investment Registration Certificate (for a foreign invested developer) or the Investment Policy Decision (for a local developer); and
- the investor may not transfer the project in any form to other investors during the period of preparation, implementation and construction of the project.
In addition, in Resolution No. 395 in July 2017, the People's Council of Ninh Thuan Province revealed its ambition to make Ninh Thuan Province a focal point for clean energy in Vietnam, proposing to expedite the process of implementation of certain renewable power projects (including 3 hydropower projects, 3 wind power projects and 8 solar power projects).
In Thanh Hoa Province, this year, the People's Committee of Thanh Hoa Province incentivized renewable energy development by way of issuing a list of renewable power projects that are prioritized for development in the province. This list includes 8 small hydropower projects (with a total capacity of 83.5MW), 11 biomass power projects (with a total capacity of 84MW), 4 solar power projects (with a total capacity of 280MW) and 1 wind power project (with a capacity of 20MW).6
In Phu Yen Province, the People's Committee of Phu Yen Province recently adopted Decision No. 17847 with an action plan for green growth in the province in the period until 2020 with a vision to 2025, proposing the development of solar power projects with a total capacity of 1,169MW by 2025.
These local level regulations must be looked at in light of the overriding national level legal instruments that still govern the development and operation of solar power projects in Vietnam.
Proposed Actions for 2018 to Respond to Climate Change
In 2017, the Prime Minister has approved a framework of policies for 2018 under the Support Program to Respond to Climate Change (SP-RCC). Accordingly, in order to contribute to the reduction of greenhouse gas emissions, the Government of Vietnam has assigned the MOIT, in 2018, to:8
- formulate and complete a database / website on renewable energy (including solar, wind and biomass);
- formulate an implementation schedule for Vietnam Renewable Energy Development Strategy until 2030 with a vision to 2050;
- formulate the support mechanisms for solar power development for the period after 2018;
- amend the model power purchase agreement for wind power projects; and
- formulate and issue regulations on the operation of companies that supply economical and efficient energy solutions.