Decision No. 39/2018/QD-TTg dated September 10, 2018 of the Prime Minister on amending a number of articles of Decision No.37/2011/QD-TTg dated June 29, 2011 of the Prime Minister on the mechanism supporting the development of wind power project in Vietnam

THE PRIME MINISTER

Decision No. 39/2018/QD-TTg dated September 10, 2018 of the Prime Minister on amending a number of articles of Decision No.37/2011/QD-TTg dated June 29, 2011 of the Prime Minister on the mechanism supporting the development of wind power project in Vietnam

Pursuant to the Law on Government organization dated June 19, 2015;

Pursuant to the Law on Electricity dated December 03, 2004 and the Law dated November 20, 2012 on amendments to a number of articles of the aforesaid Law;

Pursuant to the Law on Investment dated November 26, 2014;

Pursuant to the Law on Construction dated June 18, 2014;

At the request of the Minister of Industry and Trade;

The Prime Minister promulgates a Decision amending several articles of Decision No.37/2011/QD-TTg dated June 29, 2011 of the Prime Minister on the mechanism supporting the development of wind power project in Vietnam.

Article 1. To amendment a number of articles of Decision No. 37/2011/QD-TTg dated June 29, 2011 of the Prime Minister on the mechanism supporting the development of wind power project in Vietnam

1. To add Clause 12, 13 and 14 in Article 2 as follows:

"12. “Onshore wind power project " refers to any grid-connected wind power project with a wind turbine constructed and operated in mainland and coastal areas of which the outer boundary is the lowest mean high water for many years (18.6 years).

13. “Offshore wind power project " refers to any grid-connected wind power project with 1 wind turbine constructed and operated offshore - outside the lowest mean high water for many years (18.6) years.

14. “Commercial operation date” refers to a day on which a part or the entire grid-connected wind power plant generates power for sale satisfying the following requirements:

a) The wind power plant has undergone initial test for a part or the entire grid-connected wind power plant and connection equipment;

b) The power plant is granted a license for power generation;

c) The electricity seller and buyer mutually agree to the index of the electricity meter in order to make payment."

2. To abolish Article 3, 4 and 5.

3. To amend Article 6 as follows:

“Article 6. Investment in wind power project construction

1. The investment in wind power project construction shall be conformable with the planning on electricity development approved by competent authorities.

2. The investment in wind power project construction shall comply with provisions of the law on management of work construction investment."

4. To amend Article 8 as follows:

“Article 8. Commencement of wind power project construction

The investor is only permitted to commence to build the wind power project if requirements for commencement of work construction specified in the Construction Law are satisfied or the investor has entered into an power purchase agreement with an electricity buyer or a connection agreement with the power distributing unit or power transmission unit and has data report on wind measure for at least 12 consecutive months."

5. To abolish Article 9.

6. Article 10 shall be amended as follows:

“Article 10. Reporting regime

1. The investor shall send an authenticated copy of investment decision or investment registration certificate that has been to the Ministry of Industry and Trade for supervision and management purpose within 5 working days from the day on which such decision or such certificate is issued.

2. People’s Committees of provinces in which wind power projects are constructed shall send reports on investment registration and execution of provincial projects over the last 6 months to the Ministry of Industry and Trade for supervision and management purpose before January 15 and July 15 every year."

7. To amend Article 14 as follows:

"Article 14. Electricity price for grid-connected wind power projects

1. The buyer shall purchase the whole electricity output generated by the wind power project at the purchase price at the delivery point as follows:

a) With regard to onshore wind power projects: The purchase price at the delivery point is VND 1,928 per kWh, excluding VAT and equivalent to 8.5 US cents/kWh according to the USD/VND exchange rate quoted by the State Bank of Vietnam on August 30, 2018:  USD 1 = VND 22,683.  The electricity purchase price shall be adjusted according to the VND/USD exchange rate.

b) With regard to offshore wind power projects: The purchase price at the delivery point is VND 2,223 per kWh, excluding VAT and equivalent to 9.8 US cents/kWh according to the USD/VND exchange rate quoted by the State Bank of Vietnam on August 30, 2018:  USD 1 = VND 22,683.  The purchase price shall be adjusted according to the VND/USD exchange rate.

2. The cost for purchase of electricity generated from wind power projects shall be fully included in the annual electricity selling price plan of the Vietnam Electricity.

3. The purchase price specified in Clause 1 this Article shall apply to a part or the entire grid-connected wind power plant whose commercial operation date is earlier than November 01, 2021 and remain unchanged for 20 years from that day.

4. The purchase price specified in Clause 1 this Article shall apply to wind power projects whose commercial operation date is earlier than the issuance date of this decision from the effective date of this Decision until expiration of the power purchase agreement.

5. Wind power projects that apply the purchase price herein shall not apply the prices of electricity under other regulations in force.

6. The Ministry of Industry and Trade shall send a proposal of mechanism on auction for wind power development and wind power purchase price applied from November 01, 2021 to the Prime Minister for consideration and ratification purpose."

8. To add Point d and dd to Clause 1 Article 16 as follows:

“d) Review and provide for management of investment in wind power project construction;

dd) Conduct research and send a proposal of mechanism for promoting internal production of wind-powered machines and raising the localization rate of wind power projects."

9. To abolish Clause 2 Article 16.

Article 2. Effect

1. This Decision takes effect on November 01, 2018.

2. Ministers, Directors of ministerial agencies and Governmental agencies, Chairpersons of People’s Committees of provinces and centrally-cities, Directors of agencies and organizations involved in development of wind power projects in Vietnam shall take responsibility to implement this Decision./.

The Prime Minister

Nguyen Xuan Phuc.