“Cry for help” over two issues
Recently, Trung Nam Group sent a petition to the Prime Minister with two main concerns regarding a shortfall in revenue and the risk of deterioration to its 500kV line and transmission system after synchronisation with Trung Nam Solar Power Station.
Regarding the revenue issue, Trung Nam Company reported that the production output (approximately 687 million kWh) sent to the national grid from the 172 MW capacity segment between October 1, 2020 and August 31, 2022 has yet to be settled by the Vietnam Electricity (EVN).
The investor has repeatedly requested interim payment at a rate equal to 40% of the set price for transitional solar power plants to help resolve financial difficulties, but these requests have not been considered or resolved.
One of the main obstacles was that the project was invested and deployed across three communes: Phuoc Minh, Nhi Ha and Phuoc Ninh in Thuan Nam district. However, the electricity business license for this plant only covers Phuoc Minh commune.
Therefore, since October 2023, EVN has only settled part of the revenue generated from electricity output corresponding to the plant area within Phuoc Minh commune. Accordingly, the total outstanding payment corresponding to the remaining area is approximately VND 274.2 billion.
Regarding the 500kV line, Trung Nam argues that the Thuan Nam 500kV line has been operational for nearly four years and its continuous use could lead to deterioration and damage. This 500kV line project not only alleviates the capacity of Trung Nam’s solar power plant, but also helps to release the capacity of all other energy projects in the region, including the BOT Van Phong 1 Thermal Power Plant with a capacity of 1,432MW.
Trung Nam’s substation, 500kV transmission line and solar power project (Photo: Trung Nam)
EVN’s response
In response to the above information from Trung Nam, a representative of the Vietnam Electricity Group (EVN) stated that during the period in question, EVN has made considerable efforts to utilise the solar power plant’s on-grid capacity and has settled the output/capacity segment in accordance with Trung Nam’s license and the regulations and guidelines of the authorities. EVN has also recorded the output of the surplus capacity segment in accordance with regulations until specific regulations are issued.
“EVN has fully settled the output/capacity segment that meets legal requirements. Regarding the transitional output/capacity segment, EVN is also settling payments in accordance with the temporary price framework for transitional renewable energy projects approved by the Ministry of Industry and Trade” – EVN’s representative affirmed.
Regarding the 500kV substation and transmission line, up to the present time, these assets remain under the ownership of Trung Nam. Previously, Trung Nam proposed a non-monetary handover to EVN, but this is currently facing legal procedural obstacles and is being implemented in accordance with guidelines.
Specifically, the 500 kV substation has not yet been approved by the competent state management agency for project acceptance. Regarding the acceptance, the Government has issued Decree 02/2024/ND-CP on the transfer of public electricity works to the Vietnam Electricity Group (EVN). The relevant ministries and agencies are currently implementing this decree. It is understood that in April, the Ministry of Industry and Trade established an Inter-Sectoral Working Group to implement regulations related to the handover.
Trung Nam needs to complete its legal obligations before “crying for help”
EVN is also actively coordinating with relevant authorities to resolve Trung Nam’s difficulties.
Therefore, as the project is still incomplete in terms of legal requirements and has not been granted an electricity business license, EVN is correct in only recording the output without being able to settle the payment. As a state-owned enterprise, EVN operates in accordance with the provisions of the law and cannot make decisions independently.
Regarding the transmission of electricity to other power plants in the region, Trung Nam has the right to collect transmission fees from its partners to cover maintenance and repairs. When the asset is under Trung Nam’s management and operation, the company must bear the responsibility. EVN cannot intervene. Therefore, Trung Nam needs to complete its obligations in accordance with legal regulations before “crying for help” to the Prime Minister.
