Minister of Industry and Trade: Buy rooftop solar power for 0 VND to prevent profiteering

In the draft Decree on the mechanism to encourage the development of rooftop solar power, which was consulted last week, the Ministry of Industry and Trade maintained the proposal that this type of solar power installed in homes and offices for self-use and connected to the national grid would not be sold or sold at 0 VND. That is, people could sell the surplus, but the State would only record the output and not pay.

At the workshop on the afternoon of April 24, Minister of Industry and Trade Nguyen Hong Dien said that the above solution, along with measures to prevent energy from being transmitted back to the national grid, aims to prevent policy profiteering. This regulation is also consistent with the conditions of the current transmission and distribution system. Because the development of power sources must be in harmony, according to the National Power Development Plan that has been approved in each phase.

"This is to avoid adding pressure to the transmission and distribution system, contributing to reducing the tension in electricity supply," he said.

According to Mr. Dien, the incentive mechanisms for this type are a breakthrough in removing legal barriers to develop power sources in the context that some specialized legal regulations have not kept up with reality.

In fact, by the end of 2022, rooftop solar power capacity will be about 9,000 MW, with a selling price of 8.38 cents per kWh according to Decision 13/2020. However, during this period, there were many violations in approving additional projects to the planning, according to the conclusion of the Government Inspectorate.

By the end of 2020, 7,864 MW of rooftop solar power was in operation. This figure increased the total power capacity to 16,506 MW, 19 times the approved capacity in the adjusted Power Plan VII. This led to an increase in the solar power capacity structure by 1.4% to 23.8%.

Some regulations advised and issued by the Ministry of Industry and Trade at that time were assessed by the Government Inspectorate as "leading to loopholes, inadequacies, and risks of policy abuse" to develop large-capacity systems on agricultural and forestry land under the farm model. These projects violated planning and land use plans but still enjoyed investment incentive mechanisms, i.e., enjoyed a price of 8.38 cents per kWh for 20 years.

At the workshop, Mr. To Xuan Bao, Director of the Department of Electricity and Renewable Energy (Ministry of Industry and Trade), said that if not connected to the national grid, there will be no capacity limit. In case of grid connection, agencies, organizations and individuals have the right to generate or not generate surplus electricity into the system but pay 0 VND.

It is worth noting that, according to Mr. Bao, when people want to install self-produced and self-consumed rooftop solar power in both forms, they must register with the local Department of Industry and Trade. At the same time, the total capacity in the form of grid connection must not exceed the capacity allocated in the plan to implement Power Plan VIII (2,600 MW).

According to the Plan for implementing the Power Plan VIII, the total capacity of rooftop solar power for self-use must not exceed the allocation for each region and area. Specifically, by 2030, the maximum development in the South will be 1,110 MW; the North will be 927 MW, and the remaining provinces in the Central and Central Highlands regions (560 MW).

In order to avoid profiteering in the coming period, in the official dispatch commenting on the draft today, Vietnam Electricity Group (EVN) also noted that the management agency needs to supplement regulations and sanctions to handle cases of connecting self-generated and self-consumed rooftop solar power to systems installed before December 31, 2020 that are enjoying FIT prices for profiteering purposes.