The Ministry of Industry and Trade (MOIT) is expected to submit to the Government a draft Decree on the mechanism for direct power purchase agreements (DPPAs) in early May 2024. Photo: MOIT
|
Minister Nguyen Hong Dien said that MOIT has been developing the mechanism for DPPAs since 2019, consulting both domestic and foreign experts on many important contents. Up to now, the Government and the Prime Minister have agreed to develop the Decree and assigned MOIT to implement it.
On the basis of establishing the Drafting Committee, the Editorial Board, and the Outline of the Decree developed by MOIT, the Minister requested members to provide detailed comments as a basis for the Standing Committee of the Drafting Committee to finalize the draft Decree to be submitted to the Government.
Mr. Tran Viet Hoa, Director of the Electricity Regulatory Authority (MOIT), announced the decision to establish and appoint the members of the Drafting Committee, the Editorial Board for drafting the Government’s Decree on DPPAs, and the Outline of the draft Government’s Decree on DPPAs.
Specifically, commenting on the content of the draft Decree outline, Mr. Dau Anh Tuan, Deputy Secretary General of VCCI, said that the development of the Decree will solve two problems: creating a solid legal basis for implementation as well as having a financial plan through a spot mechanism. VCCI proposed that administrative procedures should be noted to be clear and easy to implement. In particular, it is necessary to specify the procedural process, rights, and responsibilities of the parties in the Decree.
Mr. Trinh Quoc Vu, Deputy Director of the Department of Energy Efficiency and Sustainable Development (MOIT), suggested that it is necessary to consider expanding the scope of participants in the Decree instead of only wind and solar power plants, adding other forms of energy. Regarding the customer subjects in the draft, it is only mentioned as manufacturing customers, so it is also necessary to expand because there are customers who are not manufacturers but also want to participate in the mechanism…
Urgent completion of the draft Decree
Minister Nguyen Hong Dien highly appreciated the comments of the Drafting Committee members. At the same time, he emphasized that, according to the Prime Minister’s direction, this is a very urgent issue for Vietnam and foreign investors, because if there is no such incentive mechanism, the investment of sources will also be slowed down compared to the progress. Therefore, it is essential to ensure energy security for the country in the coming time.
“The spirit is to do it urgently. The Prime Minister directed to do it according to the streamlined mechanism but must comply with the provisions of law. Shortening the time, ensuring the quality. This Decree needs to be designed in the direction of being used immediately, not in the form of a framework decree, a tubular decree,” directed Minister Nguyen Hong Dien.
The Minister suggested that the development of policies should revolve around four specific issues:
Firstly, the pricing mechanism, including transmission prices, production prices, distribution prices… through a price mechanism for regulation.
Secondly, through administrative procedures to solve arising issues.
Thirdly, regarding the purchasing subject, it is possible to expand the subjects, not just manufacturing units, but other types if there is a demand.
Fourthly, with regard to the selling subject, the Minister said, “it needs to be considered”. Because Vietnam encourages the development of renewable energy; encourage producers of clean energy sources including solar, wind, biomass, and small hydropower sources to meet the demand for green and clean production… Green and clean are not only for foreign investors but also green and clean for Vietnamese producers and investors. Domestic producers also need to produce in a green and clean direction to reach the world market.
No limit on capacity but must be limited to the type of electricity
Fifthly, regarding capacity, the Minister suggested considering opening up in a direction that is not limited but still convenient for transmission.
“There is no limit on capacity but there must be a limit on the type of electricity, which is clean energy, renewable energy, in order to facilitate the parties,” the Minister requested that the pricing mechanism be taken into account for cases of buying and selling electricity through the national electricity system.
Regarding the time, the Minister suggested: “The latest is April 12, delegates send their comments to the Electricity Regulatory Authority. From April 12-15, the Electricity Regulatory Authority will focus on finalizing.” The members of the Editorial Board and the Drafting Board must urgently complete the task so that by April 15, 2024, at the latest, the first draft version will be posted for public consultation on the Government’s Electronic Information Portal and the MOIT Electronic Information Portal.
MOIT is expected to submit to the Government the draft Decree on the mechanism for DPPAs in early May 2024.
