Circular 18/2020/TT-BCT development of solar power projects

CIRCULAR

On the development of solar power projects and model power purchase and sale contracts applicable to solar power projects^[1]

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

Pursuant to the Prime Minister’s Decision No. 13/2020/QD-TTg of April 6, 2020, on mechanisms to promote the development of solar power in Vietnam;

At the proposal of the Director General of the Electricity and Renewable Energy Authority,

The Minister of Industry and Trade promulgates the Circular on the development of solar power projects and model power purchase and sale contracts applicable to solar power projects.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular prescribes the development of grid-connected solar power projects and rooftop solar power systems, and model power purchase and sale contracts applicable to grid-connected solar power projects and rooftop solar power systems in Vietnam.

Article 2. Subjects of application

This Circular applies to organizations and individuals that participate in developing solar power in Vietnam and other related organizations and individuals.

Article 3. Interpretation of terms

1. Wp, KWp or MWp means a unit measuring the peak capacity that solar photovoltaic panels can deliver under standard conditions and announced by producers.

2. Land or water surface area used for a definite term of a grid-connected solar power project means the total area used for building works (including power plants and transformer stations but excluding power transmission lines and paths to power plants).

Chapter II

SOLAR POWER DEVELOPMENT

Article 4. Development of grid-connected solar power projects

1. Power purchase and sale prices

a/ For a grid-connected solar power project for which investment policy is decided by a competent agency before November 23, 2019, and is wholly or partially put into commercial operation between July 1, 2019, and December 31, 2020 (when initial tests for the whole or part of the project’s works have been completed under regulations; a competent agency has granted an electricity activity license for power generation; and the power seller and power purchaser have officially recorded power-meter figures for commencement of payment), the power purchase price bracket applicable to grid-connected solar power projects at power delivery points specified in the Appendix to the Prime Minister’s Decision No. 13/2020/QD-TTg of April 6, 2020, on mechanisms to promote the development of solar power in Vietnam, may apply to such project or part thereof.

b/ The sale price of power generated from a grid-connected solar power project in Ninh Thuan province shall be determined in a chronological order of recognizing the date of commercial operation (when initial tests for the whole or part of the project’s works have been completed under regulations; a competent agency has granted an electricity activity license for power generation; and the power seller and power purchaser have officially recorded power-meter figures for commencement of payment) of the project or part thereof, specifically as follows:

For the output of part or the whole of the project commercially operated before January 1, 2021, which belongs to the total accumulated output not exceeding 2,000 MW, the power sale prices specified in Clause 3, Article 5 of the Prime Minister’s Decision No. 13/2020/QD-TTg of April 6, 2020, on mechanisms to promote the development of solar power in Vietnam, may apply;

For the output of part or the whole of the project for which investment policy is decided by a competent agency before November 23, 2019, and that is put into commercial operation between July 1, 2019, and December 31, 2020, which does not belong to the total accumulated output of 2,000 MW, the power sale prices specified in Clause 1, Article 5 of the Prime Minister’s Decision No. 13/2020/QD-TTg of April 6, 2020, on mechanisms to promote the development of solar power in Vietnam, may apply.

2. Contents of the basic design dossier of a solar power project must comply with current regulations and satisfy the following requirements:

a/ Characteristics of the project area and solar radiation potential of the project;

b/ Assessment of impacts of the project connection scheme on safe and stable operation of the power system in the project area;

c/ Designs and connection with the SCADA system or load dispatch information.

3. Land and water surface area used for a definite term of a project must not exceed 1.2ha per MWp.

Article 5. Development of rooftop solar power systems

1. Power purchase and sale prices

a/ In case the power purchaser is the Vietnam Electricity Group, the prices for purchase and sale of power from rooftop solar power systems must comply with Article 8 of the Prime Minister’s Decision No. 13/2020/QD-TTg of April 6, 2020, on mechanisms to promote the development of solar power in Vietnam.

b/ In case the power purchaser is not the Vietnam Electricity Group, power purchase and sale prices shall be agreed upon between the power seller and power purchaser.

2. Order of implementation for rooftop solar power systems

a/ The power seller shall register its connection with the power purchaser, providing information on places for installation, output (not exceeding 1MW and 1.25MWp), transmission lines and planned connection points.

b/ The power purchaser shall give opinions on ability of connecting and transmitting the output of the rooftop solar power system of the power seller that registers connection to the former’s power grid system. The time limit for giving opinions is 5 working days after the power purchaser receives the registration from the power seller.

c/ The power seller and power purchaser shall implement the agreement on connection of the former’s rooftop solar power system to the latter’s power grid system. If the power seller’s rooftop solar power system is connected to the power grid not of the power purchaser or to the power grid of the power distribution and retail unit, the power purchaser and power seller shall agree with the power grid owner on implementation of the connection agreement. The time limit for signing the connection agreement is 5 working days after the power purchaser receives a complete dossier for power connection and a written approval of power connection (if any) from the power grid owner.

d/ The power seller shall install the rooftop solar power system in accordance with Points b and c, Clause 2 of this Article.

dd/ The power seller shall submit a dossier of request for sale of power from its rooftop solar power system, comprising a written request for sale of power, technical documents on solar photovoltaic panels, a device inverting direct current into alternating current (inverter), transmission lines, and transformers (if any); and true copies of the factory certificate and device quality certificate.

e/ The parties shall conduct technical inspection of and install power meters, record power-meter figures, sign power purchase and sale contracts, and put the rooftop solar power system into operation. The time limit for the power purchaser to sign the contract is 5 working days after receiving the power seller’s written request and dossier for power sale. In case the power purchaser is the Vietnam Electricity Group or its authorized member unit, the power purchaser and power seller shall sign a power purchase and sale contract under Clause 2, Article 6 of this Circular.

g/ Depending on specific conditions and technical requirements of each rooftop solar power system, the power seller and power purchaser shall agree to sequentially or simultaneously perform the items and jobs specified  at Points c, d, dd, and e, Clause 2 of this Article.

3. The power seller shall guarantee that its inverter has the function of disconnecting its power grid when the power purchaser’s power grid fails, and preventing the possibility that external factors interfere in, or seize the right to supervise the operation of the power grid, and complies with standards, technical regulations and law on power quality.

4. Rooftop solar power systems are exempted from electricity activity licenses.

Chapter III

MODEL POWER PURCHASE AND SALE CONTRACTS

Article 6. Contents of model power purchase and sale contracts

1. Contents of the model power purchase and sale contract applicable to grid-connected solar power projects are provided in Appendix 1 to this Circular.

2. Contents of the model power purchase and sale contract applicable to rooftop solar power systems are provided in Appendix 2 to this Circular.

3. Apart from the contents specified in Clause 1 or 2 of this Article, the power seller and power purchaser may add other contents to the relevant model power purchase and sale contract to clearly define responsibilities and powers of the contracting parties. The added contents must conform with and not contravene the contents of the relevant model power purchase and sale contract issued together with this Circular.

Chapter IV

ORGANIZATION OF IMPLEMENTATION

Article 7. Responsibilities of state management agencies

1. The Electricity and Renewable Energy Authority shall:

a/ Disseminate, and guide and inspect the implementation of, this Circular.

b/ Sum up and report on difficulties and problems to the Minister of Industry and Trade for consideration, amendment and supplementation of this Circular.

2. Provincial-level People’s Committees shall:

a/ Monitor, examine and supervise solar power development in their localities under current law.

b/ Before January 15 every year, send written reports on investment registration and implementation of grid-connected solar power projects in the reporting period in their localities, made according to the form provided in Appendix 3 to this Circular, to the Ministry of Industry and Trade for monitoring and management.

Article 8. Responsibilities of related organizations and individuals

1. Power purchasers

a/ The Vietnam Electricity Group shall publicize contents of a dossier of request for connection agreement, test and sign power purchase and sale contracts and conduct pre-acceptance test of rooftop solar power systems for putting them into operation; every 6 months, summarize and report on the development of rooftop solar power systems nationwide to the Ministry of Industry and Trade.

b/ To examine and monitor the operation of solar power plants (including rooftop solar power and grid-connected solar power plants) in accordance with law; upon detecting illegal external intrusion or that the power seller’s software used for monitoring the power plant’s operation devices contains illegal contents, to suspend the connection with the power system, make minutes of violations and report thereon to the Ministry of Industry and Trade for settlement.

2. Power sellers

a/ To comply with the Ministry of Industry and Trade-promulgated regulations on operation and load dispatch of power systems, regulations on transmission power systems and regulations on distribution power systems.

b/ To regularly inspect the operation and software used for monitoring the operation of solar power-fueled devices and adopt plans to combat illegal external interference and intrusion.

c/ To refrain from violating the law on assurance of information security.

d/ To carry out environmental protection, fire and explosion prevention and fighting, and power safety activities in accordance with law.

dd/ To collect and dismantle devices, restore the ground and dispose of all supplies, devices and wastes generated from solar power works during the installation and operation process or upon termination of grid-connected solar power projects and rooftop solar power systems in accordance with the law on environmental protection.

Article 9. Transitional provisions

1. For solar power projects for the whole or part of which power purchase and sale contracts are signed and of which the date of commercial operation is recognized before July 1, 2019, the signed contracts shall continue to be performed.

2. For grid-connected solar power projects (the whole projects or part thereof) and rooftop solar power systems for which power purchase and sale contracts are signed and which are put into commercial operation in the period from after June 30, 2019, to before the effective date of this Circular, power purchasers and power sellers shall sign other contracts or modify the signed contracts according to the model power purchase and sale contracts specified in Article 6 of this Circular.

Article 10. Effect

This Circular takes effect on August 31, 2020. The Ministry of Industry and Trade’s Circular No. 16/2017/TT-BCT of September 12, 2017, and Circular No. 05/2019/TT-BCT of March 11, 2019, prescribing the development of solar power projects and model power purchase and sale contracts applicable to solar power projects, cease to be effective on the date this Circular takes effect.-

For the Minister of Industry and Trade
Deputy Minister
HOANG QUOC VUONG

* The appendices to this Circular are not translated.