Investors are no longer rushing to pour money into solar power projects because the new solar power purchase price is considered unattractive.
Hundreds of investors raced to build solar power plants to be able to put the plants into operation prior to the ‘zero hour’ – June 30, 2019.
This was the deadline for them to fulfill their investment projects to be able to sell electricity at the high price of 9.35 cent per kwh, or VND2,086 for 20 years.
Just within a short time, nearly 100 solar power plants became operational. Only three solar power plants became operational in 2018.
Three more were put into operation in the first three months of 2019. Meanwhile, in the short period from April to June, 81 power plants were connected to the national grid.
Just within a short time, nearly 100 solar power plants became operational. Only three solar power plants became operational in 2018. Three more were put into operation in the first three months of 2019. Meanwhile, in the short period from April to June, 81 power plants were connected to the national grid.
The capacity of solar power plants reached 4,500 MW, while the total capacity of all power sources is 45,000 MW.
However, though many investors put their power plants into operation prior to June 30, 2019, they were not happy because all electricity could not be sold.
According to Pham Van Hau, deputy chair of the Ninh Thuan province, many plants run at 30-40 percent of designed capacity because of the overloading of the transmission network.
The Ministry of Industry and Trade (MOIT) has requested to speed up the improvement of the 110 kV transmission line system in Ninh Thuan and Binh Thuan to solve the overloading, and promote investments in transmission network projects.
Meanwhile, the investors who failed to put power plants into operation have been put on tenterhooks because of the new policy.
GA Power Solar Park is building two solar power plants with the total capacity of 60 MW in Ha Tinh province, capitalized at $50 million. It hoped the plants would connect the national grid prior to June 30, 2019 to enjoy the high price of 9.35 cent. But the plan failed for some reasons.
And the investor was astonished when hearing that the electricity purchase price after June 30 is VND1,620 per kwh only.
“If we had not started, we would have never done it,” said Bui Quang Cuong, director of GA Power Solar Park.
The company has to continue the project, because money has been transferred to partners, while equipment has arrived. However, if it goes ahead, it will take a loss.
Some analysts have warned that the situation may becile even worse. The Prime Minister has decided to put solar power projects into auction, and only a few projects will enjoy the FIT (feed in tariff) price policy.
According to MOIT, only seven projects with total capacity of 320 MW are eligible for FIT.
More than 1,000 businesses located at processing, industrial and hi-tech parks in Ho Chi Minh City are set to have solar panels installed on their rooftops in the next few years in an effort to promote green development.
The Ministry of Industry and Trade (MoIT) has had a change of heart on the bidding mechanism for solar power tariffs in Vietnam.