The Vietnamese Ministry of Industry and Trade (MOIT) has proposed to bring down feed-in-tariff (FIT) rates for ground mounted solar power project in the second phase of the regime to $0.0709 per kWh, as against $0.0935 per kWh offered to all kinds of solar projects commissioned till June 30, 2019 under FIT1 (see Vietnam Introduces Solar Incentives).
The Vietnam News reported that as per the proposal submitted by MOIT to the Prime Minister Nguyễn Xuân Phúc, FIT2 rate for floating solar power projects is suggested to be $0.0769 per kWh and the existing tariff of $0.0935 per kWh to be continued for rooftop solar projects.
Once approved by the Prime Minister, these FITs will be applicable for projects commissioned between July 1, 2019 to December 31, 2021.
FIT1 with $0.0935 per kWh was hugely successful, resulting into some 82 solar power plants commissioned before the June 30, 2019 deadline and representing more than 4.46 GW of total capacity, according to national utility Electricity of Vietnam that expects another 630 MW to come online by the end of 2019 (see Vietnam: Over 4 GW PV Grid Connected By June 2019).
Dr Oliver Massmann, General Director of law firm Duane Morris Vietnam LLC, said that the final FIT2 draft aims mostly at encouraging solar power project development in the southern area where close to 6 GW to 8 GW of capacity is needed to realize power demand there up to 2021.
Only for Ninh Thuan province, a big hit with solar power investors, projects that are complete before January 1, 2021 within the capacity of 2 GW, will be able to avail the existing $0.0935 per kWh, said Massmann. The final decision on the FIT2 rates is expected to be issued within September 2019.
In February 2019, the ministry was said to have proposed solar FITs within the range of $0.0659 per kWh to $0.0985 per kWh while recommending extension to the FIT (see Vietnam FIT May Get Extension).