Circular No. 05/2019/TT-BCT dated March 11, 2019 of the Ministry of Industry And Trade on amend and supplement the Circular No. 16/2017/TT-BCT dated September 12, 2017 of the Minister of Industry and Trade on project development and model power purchase agreements applied to solar power projects

THE MINISTRY OF INDUSTRY AND TRADE 

Circular No. 05/2019/TT-BCT dated March 11, 2019 of the Ministry of Industry And Trade on amend and supplement the Circular No.16/2017/TT-BCT dated September 12, 2017 of the Minister of Industry and Trade on project development and model power purchase agreements applied to solar power projects

Pursuant to the Law on Electricity No. 28/2004/QH11 dated December 03, 2004; Law on Amendments to certain articles of the Law on Electricity dated November 20, 2012;

Pursuant to the Government’s Decree No. 98/2017/ND-CP dated August 18, 2017 on functions, tasks, power and organizational structure of the Ministry of Industry and Trade;

Pursuant to the Decision No. 11/2017/QD-TTg dated April 11, 2017 by the Prime Minister on mechanism for encouragement of solar power project development in Vietnam and the Decision No. 02/2019/QD-TTg on amendments and supplements the Decision No. 11/2017/QD-TTG

At the proposal of the Director of the General Directorate of Energy and Recycle Energy,

The Minister of Industry and Trade promulgates a Circular on amend and supplement a number of Article of the Circular No. 16/2017/TT-BTC DATED September 12, 2017 of the Minister of Industry and Trade on project development and model Power Purchase Agreements applied to solar power projects.

Article 1.Amendment and supplement of a number of the Circular No. 16/2017/TT-BTC DATED September 12, 2017 of the Minister of Industry and Trade on project development and model Power Purchase Agreements applied to solar power projects

Article 16. Electricity pricing of rooftop PV power projects

1. The selling price of electricity before January 01, 2018 shall be VND 2,086/kWh (VAT excluded, equivalent to U.S. cent 9.35/kWh, according to the central exchange rate of VND over USD quoted by the State Bank of Vietnam on April 10, 2017, which is VND 22,316/USD).

2. After January 01, 2018, the electricity price prescribed in Clause 1 this Article shall be adjusted according to the central exchange rate of VND over USD quoted by the State Bank of Vietnam on the last working day of the previous year.

3. To amend content to Model PPAS Applied to Solar Power Projects in the Appendixes of this Circular.

Article 2.

To repeal Clause 2, Article 18 and Appendix III of the Circular No. 16/2017/TT-BTC DATED September 12, 2017 of the Minister of Industry and Trade on project development and model Power Purchase Agreements applied to solar power projects.

Article 3.Effect

This Circular takes effect on April 25, 2019.

The Minister

Tran Tuan Anh

APPENDIX

MODEL PPA APPLIED TO ROOFTOP SOLAR POWER PROJECTS
(Attached to the Circular No. 05/2019/TT-BCT dated March 11, 2019 by the Minister of Industry and Trade)

SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom – Happiness
-------------

POWER PURCHASE AGREEMENT

Pursuant to the Law on Electricity dated December 03, 2004; Law on Amendments to certain articles of the Law on Electricity dated November 20, 2012;

Pursuant to the Commercial Law dated June 14, 2005;

Pursuant to the Decision No. 11/2017/QD-TTg dated April 11, 2017 by the Prime Minister on mechanism for encouragement of solar power project development in Vietnam;

Pursuant to the Circular No. 16/2017/TT-BCT dated September 12, 2017 by the Minister of Industry and Trade on the project development and the model Power Purchase Agreement applied to solar power projects; and the

Pursuant to demands for electricity purchase and sale of both parties,

Today, on (month, day, year) ......................................., at..............................

We are:

The Seller:

Address: ________________________________________________________

Telephone: ______________Email: _______________Fax: _______________

Tax identification No. _____________Business Registration No. ___________

Account No.: ___________________opened at Bank _____________________

Represented by:___________________________________________________

ID/Passport number:_______________________________________________

Position______________________ (Authorized by ______________________                                                        under the Power of Attorney No. _______________dated ________________)

(Hereinafter referred to as “the Seller”); and

The Buyer: _________________________________________________

Address: ________________________________________________________

Telephone: ______________Email: _______________Fax: _______________

Tax identification No. _____________Business Registration No. ___________

Account No.: ___________________opened at Bank _____________________

Represented by: ___________________________________________________

Position______________________ (Authorized by ______________________                                                        under the Power of Attorney No. _______________dated ________________)

(Hereinafter referred to as “the Buyer”).

Both Parties agree to conclude the Power Purchase Agreement (Hereinafter referred to as Agreement) to sell and purchase electricity from the [name of the project] solar power plant having the total installed capacity of [capacity of the project] kW built and operated by the Seller at [location of the project] with the following terms and conditions:

Article 1. Sold and purchased power

1. From the commercial operation date, the Seller agrees to deliver and sell power to the Buyer and the Buyer agrees to buy the Seller’s power generated from the power plant of the Seller which is measured through the meter reading in accordance with the Minutes of hanging and removing meters attached to this Agreement and this Minutes is inseparable from the Agreement and shall be replaced (periodically or under damage) in the process of selling.

2. The Buyer shall purchase all electricity generated on the Buyer’s grid at the buying price specified in Article 2 of this Agreement.

3. The power transfer from the Buyer’s grid to the Seller’s grid shall be purchased under a separate Agreement from this Agreement.

Article 2. Electricity selling price

1. The selling price of electricity before January 01, 2018 shall be VND 2,086/kWh (VAT excluded, equivalent to U.S. cent 9.35/kWh, according to the central exchange rate of VND over USD quoted by the State Bank of Vietnam on April 10, 2017, which is VND 22,316/USD).

2. After January 01, 2018, the electricity price prescribed in Clause 1 this Article shall be adjusted according to the central exchange rate of VND over USD quoted by the State Bank of Vietnam on the last working day of the previous year.

3. The selling price mentioned Clause 1 and Clause 2 this Article shall apply for 20 years from the commercial operation date.

Article 3. Record of the meter, power generated on the grid and billing

1. Record of the meter reading and power generated on the grid

- The Buyer shall record of the meter reading on ….. date of every month.

- In the duration of one working day from the record of the meter reading, the Buyer shall inform the Seller of the meter readings and the amount of electricity generated on the grid during the payment period by one of these following forms:

Web:……………………..Email…………………….Zalo/Viber:……………....

- After that time limit, if the Seller does not have any comment to the Buyer then it shall be considered that the Seller agreed to the information given by the Buyer.

2. Electricity bills

a. Electricity bills: based on the amount of electricity agreed by both parties in Article 1 and the electricity price in Article 2 of this Agreement, the Buyer shall pay the purchase for the Seller (VAT excluded) as follow:

T(n)= Ag (n) x G (n)

In which:

T (n): Electricity bills of month n (VND)

Ag (n): Amount of electricity generated on the grid of the Buyer on month n (kWh).

- If the meter is the single-phase meter, Ag (n) is the final electricity amount the Seller generated up on the Buyer’s grid recorded by the meter.

- If the meter is the triple-phase meter, Ag (n) is the total electricity amount of three phase (normal, peak and low point)the Seller generated up on the Buyer’s grid recorded by the meter.

G (n): the selling price of month n specific in Article 2 of this Agreement (VND/kWh).

b. VAT: In addition to the electricity bill at point a Clause 2 of this Article, the Buyer shall pay the Seller the VAT if the Seller have the venue of the Seller is taxable object according to laws. After takes the last record of meter reading of the year, the Buyer shall hold responsibility to finalize the purchase of electricity in the year and the VAT base on the revenue generated from the power project.

Article 4. Payment

1. Payment profile

a) The Seller is an enterprise has monthly invoice:

List of record of meter reading and amount of electricity generated up on the Buyer grid provided by the Buyer;

Invoice of the Seller accordance with the value of payment determined in Clause 2 Article 3 of this Agreement.

b) The Seller is organization or individual without monthly invoice:
Each month:

The Buyer shall base on the List of meter reading record and the electricity generated in the grid of the Buyer by the Seller to pay the Seller, the payment value is determined in Section a Clause 2 Article 3 of this Agreement.

Each year:

Maximum 15 days after the last day of the year or the ending day of the Agreement depend on which date due first, the Buyer shall make the minus of “Delivered electricity metered and electricity bills” by the form (provided by the Buyer) in this Agreement.

In case the Seller has the taxable objectsrevenue level specified in Section b Clause 3 Article 3, the Seller shall have to send to the Buyer the invoice include tax and fee as prescribed by laws.

2. Payment method:

Bank transfer (fee is on the Seller)

Account information: …………………………………………………………….

3. Payment duration

a) In the period of 07 working days after the Seller determines the meter reading record and the amount of electricity generated on the grid (by the Buyer notification) and hand in the payment profile prescribed in Clause 1 this Article.

b) After the above duration, if the Buyer does not finish the payment he/she shall have to pay the deferred interest which is counted from the due date of the payment to the day of payment.  Deferred interest is calculated by the average inter-bank transaction interest rate for one (01) month announced by the State Bank of Vietnam at the time of payment by the Buyer.

Article 5: Rights and obligations

1. Rights and obligations of the Seller

a) Guarantee the technical standard on solar electricity, guarantee the electric quality in accordance with regulation in Clause 1 Article 15 of the Government’s Decree 137/2013/ND-CP dated October 21, 2013 on detailing a number of articles of the Electricity Law and the Law Amending and Supplementing a Number of Articles of the Electricity Law; Article 40, 41 of the Circular No. 39/2015/TT-BCT dated November 18, 2015 of the Ministry of Industry and Trade or other amendatory document, unless otherwise agreed.

b) To coordinate with the Buyer to record, unify and monitor the amount of electricity generated on the grid of the Buyer.

c) To operate the power plan in accordance with the regulation in Article 52 Circular No. 39/2015/TT-BCT.

d) The Seller must not connect other power sources, outside the Project agreed in this Agreement, through the metering system without the consent of the Buyer.

2. Rights and obligations of the Buyer

a) To investing and installing bidirectional meters at the power delivery point for the Seller if the Seller meets the connection criteria in Section a, Clause 1 of this Article.

b) To coordinate with the Seller to record, unify and monitor the amount of electricity generated on the grid.

c) To control, supervise and handle the connection device in accordance with Article 52 Circular No. 39/2015/TT-BCT.

d) The Buyer have right to refuse to pay if the Seller fail to comply with the term specified in Section a, c, d, e Clause 1 this Article.

Article 6. Other agreements

……………………………………………………………………………………

Article 7. Implementation provision

1. Except of extended or terminated before the expiry date, this Agreement is effective from the date of signing and has a term of 20 years from the commercial operation date.

2. During the implementation period, either party has a request to amend, supplement or terminate the Agreement, the requesting party must notify the other party 15 days in advance to resolve it together.

3. This Agreement is made into 02 copies with the same legal value, each party keeps 01 copy.