VIETNAM - ROOFTOP SOLAR POWER PROJECTS - NEW POLICY TO ADDRESS NET-METERING ISSUE

1. VIETNAM - ROOFTOP SOLAR POWER PROJECTS
NEW POLICY TO ADDRESS NET-METERING ISSUE
On 8 January 2019, the Prime Minister has issued Decision No. 02/2019/QD-TTg (“Decision 02”) to amend
certain articles of Decision 11/2017/QD-TTg dated 11 April 2017 of the Prime Minister on mechanism for
encouragement of development of solar power in Vietnam (“Decision 11”). Decision 02, became effective
on 8 January 2019, promulgates new payment scheme to address the net-metering issue of the rooftop solar
power projects under Decision 11. We elaborate the above topic further as below:
In 2017, Decision 11 introduced the net-metering scheme for rooftop solar power projects. In brief, rooftop
projects must be implemented in net-metering with two-way electricity meters. In a trading cycle, if the
amount of electricity generated from rooftop projects is greater than the consumed amount, the surplus will
be carry forward to the next trading cycle. At the end of the year or when the contract is terminated, the
surplus amount of energy will be sold to EVN at the rate mentioned in the power purchase agreement signed
by the seller and EVN either at the end of the relevant year or upon termination of the agreement. Circular
16/2017/TT-BCT (“Circular 16”) dated 12 September 2017 of the Ministry of Industry and Trade
(“MOIT”), requires a solar power generator, as the seller, to enter into a model power purchase agreement
(in the form attached to Circular 16) with EVN or its authorized subsidiary. However, in practice, the model
power purchase agreement has not been applied by EVN since the MOIT and the MOF had no guidance on
the finalization, payment scheme and invoicing mechanism for such net-metering purposes. Other words,
EVN claimed that it is very challenging for them to calculate and invoice the power based on net-metering
scheme.
In order to address the net-metering issue, Decision 02 now has introduced a new payment scheme for
rooftop solar power projects. In brief, the power generated by rooftop solar power project will be metered
independently and paid by EVN to the seller. The power sold by EVN or its power company to consumers
being rooftop solar power investors will be metered as usual like other households / consumers.
All rooftop solar power projects having their commercial operation date (operation and metering
confirmation) prior to 1 July 2019 will enjoy FIT of US$9.35 / KWh under Decision 11. The price of
rooftop solar power for following years must be adjusted according to the last year exchange rate between
Vietnamese Dong and USD issued by the State Bank of Vietnam.
The MOIT shall promulgate technical regulations on solar power, regulations on measurement of energy
of solar power projects and provide instructions on the connection, installation of electricity meters and the
calculation of rooftop solar power project.
We will keep you informed with any new guidance from the MOIT for rooftop solar power projects.
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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com if you have
any questions or want to know more details on the above. Dr. Oliver Massmann is the General Director of
Duane Morris Vietnam LLC.