Vietnam’s proposes to extend the solar feed-in-tariff by two years
On 29 January 2019, the Vietnam Ministry of Industry and Trade issued the draft policy to extend the solar feed-in-tariff (FIT) eligibility until 30 June 2021. This is an extension of two years from the earlier 11/2017/QD-TTg. This extension is coupled with a shift from a single standardized FIT, to differentiated FITs based on the regions' solar irradiance, installation type and commercial operation date.
Although the FIT is being extended until 30 June 2021, the overall rates have been reduced. The largest reduction is almost 30% lower for projects that achieve commercial operations between 1 July 2020 and 30 June 2021, in provinces with the best solar irradiance. This will motivate developers to meet the 30 June 2019 deadline to qualify for the rewarding $93.50/MWh feed-in tariff.
The proposed FIT is also differentiated by region, based on the solar irradiance for each province/municipality. The government has proposed lower FIT rates for regions with better solar resources and higher rates for poorer irradiance regions. This differentiated rate aims to spread out solar development more evenly across the country.
Figure 1: Heat map of solar PPAs in Vietnam
For more information about the new proposed tariffs, please log on to IHS Markit Connect and visit our South and Southeast Asia Power, Gas, Coal and Renewables page.
Joo Yeow Lee is a Senior Research Analyst at IHS Markit.
Posted 11 February 2019
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