The Ministry of Industry and Trade is seeking feedback on a draft decree detailing several articles of the Law on Electricity regarding renewable and new energy sources.
Incentive Policies
The Ministry proposes several incentives and support policies for solar and wind power projects with energy storage systems. These include: Giving priority to mobilizing power sources from these projects; energy storage systems are considered goods and products that enjoy preferential tax policies…
The most notable content is about the mechanism and policies for developing offshore wind power. According to the Power Plan 8, Vietnam aims to achieve 6,000 MW of offshore wind power by 2030 and reach a capacity of 30,000 – 50,000 MW by 2050, becoming a hub for offshore wind power production in Southeast Asia. This is a new type of power source, and Vietnam does not have any operational projects yet.
To encourage the development of this power source, the Ministry proposes that offshore wind power projects are exempt from sea area use fees during the construction period; a 50% reduction in sea area use fees for 12 years from the start of operation. The project is also exempt from land use fees and land rent during the construction period and continues to be exempt according to investment and land laws.
 The Ministry of Industry and Trade proposes an exemption of sea area use fees for offshore wind power projects during the construction period. Photo: CIP. |
In addition, state-owned enterprises with 100% charter capital investing in offshore wind power projects will be considered and decided on credit extension beyond the limit prescribed by the Law on Credit Institutions. However, the condition for offshore wind power projects to enjoy these incentives is to be decided or approved for investment before January 1, 2031.
Foreign Investor Capital Contribution Not Exceeding 65%
For foreign investors implementing offshore wind power projects, in the case of foreign enterprises, the Ministry proposes that they have implemented at least 1 project of similar scale in Vietnam or worldwide; the total net asset value in the last 3 years audited must be larger than the expected total investment of the project. At the same time, these projects must involve Vietnamese enterprises, with the condition that the foreign investor’s capital contribution does not exceed 65% of the charter capital in the joint venture.
In the case of Vietnamese enterprises implementing offshore wind power projects, they must have financial capacity, capital mobilization plans or loan commitments, and human resources with expertise and experience to implement the project.
Regarding the price of offshore wind power, the Ministry proposes that the ceiling price in the bidding documents should not be higher than the maximum price of the power price framework issued by the Ministry. The winning bid price for selecting the investor is the maximum price for the power purchaser to negotiate with the winning investor.
For offshore wind power projects producing electricity for export purposes without going through the national power system, in the case of foreign investor participation, the Ministry requires domestic investors to hold a total share ratio of more than 50%.
The transfer of projects, shares, or capital contributions in offshore wind power projects must comply with the regulations in Clause 1, Article 26 of the Law on Electricity and be approved by the competent authority for sea area allocation (Ministry of National Defense, Ministry of Public Security, Ministry of Industry and Trade, Ministry of Foreign Affairs…).
Duong Hung
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