Will there be a new wave of rooftop solar installation?

With the new policy on electricity price in Decision No. 13, effective from 22 May 2020, with the official contract form for the Electricity sector to purchase electricity from people’s sources, experts believe that there will be a wave of investment in rooftop solar power.

Rooftop solar power is a trend followed by many families and businesses

Installing electricity for daily use and sale to the Electricity sector

The updated data of EVNHCMC shows that by 22 May 2020, the corporation has spent more than VND 7.9 billion to buy power directly from households installing Rooftop solar power (RSP) with total output of 31, 4 million kWh.

The representative of EVNHCMC added that, by the end of 2019, the whole city of Ho Chi Minh will have about 5,660 buildings with a total installed capacity of 69.53MWp, as of 15 May 2020, this figure is nearly 7,000 works with a total installed capacity of about 90MWp. The amount of electricity generated on the grid so far is 31.39 million kWh (excluding the electricity output used by customers).

In addition, in 18 industrial parks - export processing zones in the city, 44 enterprises have installed the system with a total capacity of 13.4MWp. Meanwhile, the data of Electricity of Vietnam (EVN) said that in the first 4 months of 2020, there were 5,254 RSP  projects selling electricity to EVN with a total installed capacity of 178.66MWp, electricity output generated to the grid is 137.1 million kWh.

Will the number of households selling electricity increase exponentially?

It can be added that, accumulated up to now, the country has developed 27,631 EIA projects with a total installed capacity of 562.8MWp, but only the projects completed before 30 June 2019 are allowed to sell electricity. Therefore, according to EVN, with Decision No. 13 on the mechanism of solar power price (including RSP) officially taking effect from 22 May 2020, all of the above projects will be allowed to sell power to the Electricity sector, so that the number of households earning from this form will skyrocket as well as there will be a new wave of investment in RSP.

In order to facilitate the purchase and sale of RSP, over the weekend, the Ministry of Industry and Trade (MOIT) decided to allow the use of standardized power purchase contracts (specified in Circular No. 05 of 2019) with electricity price adjustment complying with Decision No. 13 to sign  power purchase contracts with the RSP investor that has been put into operation after 30 June 2019. Thus, from 25 May 2020, EVN has been able to sign new contracts and pay electricity bills to customers.

Experts and management agencies said that Decision No. 13 of the Prime Minister after officially taking effect will create a momentum for RSP to enter a new development cycle. According to Associate Professor Ngo Tri Long, former Director of the Price Research Institute, the practical benefits brought by RSP were clear, in addition to reducing the monthly electricity cost due to electricity being generated and used directly during peak hours or reduced in high purchase price, not using much land  for installation, short installation time and with more decreasing costs, the current payback period is only about 4-5 years. However, besides the existing price policies, Mr. Long also said that the Electricity sector should have more policies to encourage the development of RSP, because this is a significant source of additional power for the electricity system, especially in the peak hours at noon.

Mr. Pham Viet Anh, an expert of Vietnam Renewable Energy Forum, said a new wave of investment in RSP was almost certain. Nevertheless, there was a need for additional incentive mechanisms to allow administrative units, agencies, schools, hospitals and state-owned enterprises to invest or call for socialization in investment in RSP for use and resale the excess amount  to the sector. In addition, it is necessary to research, consider and propose putting the RSP installation into the requirements in the construction standards of large-roof buildings such as apartments, commercial centers, hotels, etc.

According to Decision No. 13, the payment for electricity with the specific purchase price of RSP is specified as follows:

- From1  July 2019 – 31 December 2019, the electricity purchase price (excluding value added tax) is 1,913 VND/kWh.

- From J1 January 2020 to 31 December 2020, the electricity purchase price (excluding value added) is VND 1,940/kWh.

- From 2021 and subsequent years, the electricity purchase price is determined annually in Vietnam Dong equivalent to 8.38 US cents/kWh multiplied by the central exchange rate of VND/USD announced by the State Bank for the last day of the previous year.

  • 26/05/2020 05:03
  • evn.com.vn