Many provinces have proposed to the Government and the Ministry of Industry and Trade to consider and extend the FIT prices under Decision No. 39 for the on-going projects in the area, because the progress is being affected by COVID-19.

Simultaneously sending petitions

The People’s Committees of Tra Vinh, Gia Lai and Soc Trang provinces simultaneously submitted written proposals to the Prime Minister and the Ministry of Industry and Trade to assess the possibility that wind power projects in the area could not be completed and commercially operated before November 2021 to enjoy the preferential price of 9.8 cents/kWh (according to Decision 39).

The reason given by the localities is that the complicated development of the COVID-19 epidemic has hampered wind turbine supply progress (the overseas equipment supplier is behind schedule in the host country, the heavy equipment is complex due to social distancing). Moreover, the immigration activities of experts and workers are disrupted, import and export of goods are interrupted, material prices are abnormally high, etc., so many projects Wind power in the above provinces are on hold.

As a result, localities have suggested to the Prime Minister and the Ministry of Industry and Trade that they evaluate and authorize an extension of the time to use the FIT pricing method for projects under their jurisdiction.

According to the Tra Vinh Provincial People's Committee, Tra Vinh has authorized the investment strategy of 8 wind power projects with a total capacity of 570MW. Six of these projects, including wind power Tra Vinh - Korea (phase 1) with a capacity of 48 MW, wind power V1-2 (48 MW), wind power No. 3 at location V1-3 (48 MW), Duyen Hai wind power (48 MW), Hiep Thanh wind power (78 MW), and Dong Hai 1 wind power, are being supported by the local to expedite construction (100 MW).

Many projects are anticipated to be late for commercial operation before October 31, 2021, based on monitoring the actual situation and the investors' own opinion. As a result, Tra Vinh province requests the Prime Minister that the time limit for using the FIT pricing mechanism for wind generation projects in the area be extended until at least the end of April 2022.

In Soc Trang province, 20 wind power projects with a total capacity of 1,435 MW have been approved in the local wind power development planning and power planning VII. Currently, the province has authorized policies for 16 projects (total capacity of around 1,095 MW), 11 of which are under development.

With the impact of the COVID-19 epidemic causing a delay in construction progress, making timely operation of the FIT price difficult, the Soc Trang Provincial People's Committee proposed to the Ministry of Industry and Trade that an extension of the implementation period be submitted to the Prime Minister. FIT price is valid until March 31, 2022. Wind power projects currently under construction will benefit from the extension (with signed power purchase and sale contracts, equipment procurement contracts, feasibility study reports, technical designs, etc.).

The Gia Lai Provincial People's Committee also suggests extending the deadline until December 31, 2021. This municipality has authorized investment policies for 17 wind power projects (total capacity of about 1,242 MW, approved for planning).

Wind farm projects likely to get delayed

According to the most recent Electricity of Vietnam (EVN) data, by the end of August 3, 2021, a total of 106 wind power plants had sent documents and registration documents for the program of energizing and connecting to the grid, testing experience, and application for commercial operation accreditation (COD). These 106 wind power facilities have a total registered COD test capacity of 5,655.5 MW.

However, according to wind power investors, investor registration is merely an administrative procedure, and it is challenging to execute the project on time under the existing circumstances. Currently, some projects have not completed site clearance out of 106 factories that have submitted dossiers. Meanwhile, according to Decision 39, the time restriction for taking advantage of the advantageous pricing is just over two months when the FIT price for wind power expires after October 31.

According to a wind power project investor, to meet the deadline for submitting the application for acceptance test and preparing for commercial operation date (COD) recognition before October 31, 2021, the investor must apply for acceptance test and prepare for COD recognition before October 31, 2021. By law, wind power plant investors must deliver documentation and dossiers to electricity buyers (EVN) by August 3, 2021. However, whether or not it can be realized depends on the investor's progress. Investors anticipate that the wind power capacity operational by October 31, 2021, will be less than the capacity registered with EVN.

According to the Institute of Energy (Ministry of Industry and Trade), the total capacity of renewable energy sources permitted to complement planning until 2025 is around 25,500 MW (excluding rooftop solar power projects). Included in this figure are 13,900 MW of farm solar power and 11,500 MW of wind power.

As a result, the remaining 5,000 MW of solar power and 6,144 MW of wind power have been cleared for planning but will not be operational until 2021. However, there is currently no precise information on development incentive schemes. Renewable energy beyond October-October 2021, therefore wind power projects will face numerous dangers if they do not enter commercial operation within 11 years. Thereby, the progression of these sources remains problematic.

According to EVN's latest analysis on the balance of electricity supply and demand in the 2021-2025 timeframe, if power sources fall behind schedule and renewable energy sources cease to be deployed after October 2021, the system will face a power source shortfall. A large bow By 2025, the shortage might amount to 27.7 billion kWh of electricity.