Circular 09/2025/TT-BCT methods for determining electricity generation price bracket; electricity import price bracket

CIRCULAR

On the dossier, order, procedures, and methods for determining and approving the electricity generation price bracket; dossier, order, procedures for developing and approving the electricity import price bracket

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Pursuant to the Law on Electricity dated December 03, 2004;

Pursuant to the Government's Decree No. 96/2022/ND-CP dated November 29, 2022, defining the functions, tasks, powers and organizational structure of the Ministry of Industry and Trade; the Government’s Decree No. 105/2024/ND-CP dated August 1, 2024, amending and supplementing a number of articles of Decree No. 96/2022/ND-CP dated November 29, 2022 and Decree No. 26/2018/ND-CP dated February 28, 2018, on Charter of organization and operation of Vietnam Electricity;

At the proposal of the Director of the Electricity Regulatory Authority;

The Minister of Industry and Trade hereby promulgates the Circular on the dossier, order, procedures, and methods for determining and approving the electricity generation price bracket; dossier, order, procedures for developing and approving the electricity import price bracket.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation and subjects of application

1. Scope of regulation

This Circular details a number of articles of the Electricity Law No. 61/2024/QH15, including:

a) Clause 5 Article 46 on the dossier, order and procedures for developing and approving the electricity import price bracket, and methods for developing the electricity import price bracket;

b) Clause 3 Article 51 of the Electricity Law on the dossier, order and procedures, methods for determining the electricity generation price bracket; approving the electricity generation price bracket formulated and submitted by electricity entities.

2. This Circular applies to the following subjects:

a) Agencies, organizations, and individuals owning power plants operating within the territory of the Socialist Republic of Vietnam that are connected to the national power system, except for strategic multi-purpose hydropower plants, small renewable energy plants applying the avoidable cost tariff, power plants, and generating units providing ancillary services; and power plants applying the electricity purchase pricing mechanisms stipulated in competent authorities' documents;

b) Domestic organizations engaged in importing electricity from organizations and individuals in the territory of the Lao People's Democratic Republic (hereinafter referred to as Laos) and the People's Republic of China (hereinafter referred to as China);

c) Vietnam Electricity;

d) Other relevant organizations and individuals.

Article 2. Interpret of term

In this Circular, the terms below are construed as follows:

1. Calculation parameter set refers to the parameters used for determining the electricity generation price bracket, collected by the electricity entity based on the feasibility study report of the power plant construction project approved and the basic design appraised within 48 months prior to the price bracket calculation for coal and gas-fired power plants, and within 24 months prior to the price bracket calculation for the types of power plants other than coal and gas-fired power plants.

2. Power system and electricity market operator refers to the entity performing the functions of the national power system dispatching unit and the electricity market transaction operator as stipulated in the Electricity Law (currently the National Power System and Market Operator Company Limited).

3. Pumped-storage hydropower plant refers to a hydropower plant that uses a water storage system at different elevations to store energy and generate electricity, wherein water is pumped from a lower reservoir to a higher reservoir during non-generation periods to store energy.

4. Floating solar power plant refers to a solar power plant connected to the national power system, with photovoltaic panels installed on floating structures on water surfaces.

5. Ground-mounted solar power plant refers to a solar power plant connected to the national power system, excluding the plants specified in Clause 4 of this Article.

6. Onshore wind power plant refers to a wind power plant connected to the national power system, excluding the wind power plants specified in Clause 5 Article 20 of the Electricity Law.

Chapter II

METHODS FOR DETERMINING THE ELECTRICITY GENERATION PRICE BRACKET

Article 3. Principles for establishing the electricity generation price bracket

1. The electricity generation price bracket ranges from a minimum price (0 VND/kWh) to a maximum price.

2. The maximum price corresponds to each type of power plant (excluding hydropower plants) and is determined based on the methods prescribed in Articles 4, 5, 6, and 7 of this Circular.

3. For hydropower plants, the maximum price is determined based on the annual avoidable cost tariff method as prescribed in Article 8 of this Circular.

4. The electricity generation price bracket for solar power plants is developed based on the average annual solar radiation intensity in the 3 (three) regions: The North, the Central, and the South.

5. For a type of power plant of which the project's feasibility study report has not yet been approved or basic design has not yet been appraised, the calculation parameters for determining the electricity generation price bracket shall be determined based on consultations with consulting organizations, as per the methods specified in this Circular.

6. For renewable energy power plants incorporating energy storage systems, if the energy storage system exclusively consumes electricity generated by these renewable energy plants during charging cycles, the total investment cost for determining the electricity generation price bracket shall include the investment costs of the energy storage system components.

Article 4. Methods to determine electricity generation price

Electricity generation price P_C (VND/kWh) shall be determined according to the following formula:

P_c = FC + FOMC + VC

In which:

Article 5. Method to determine the average fixed cost

1. The average fixed cost FC (VND/kWh) is a component for recovering investment costs and is determined according to the following formula:

In which:

2. The annually converted investment capital cost (TC) is determined according to the following formula:

In which:

3. The calculated capacity is the capacity of the power plant selected from the calculation parameter set based on the implementation of the national power development plan. The calculated capacity is converted to the electricity delivery point with the purchaser through the ratio of self-consumed electricity, step-up transformer losses, and transmission line losses (if applicable).

4. The calculated investment rate refers to the investment cost per kW (or kWp) of the power plant, in which the total investment cost (including only electricity production-related items) valid at the time of determining the electricity generation price bracket, updated with the exchange rate at the calculation time, is determined based on one of the following:

a) The investment rate of a power plant with a selected calculated capacity under Clause 3 of this Article;

b) The average investment rate of power plants using the same technology based on the calculation parameter set.

If the calculated investment rate cannot be determined according to Points a or b of this Clause, it is selected based on actual data from power purchase agreement negotiations or references from consulting organizations.

5. The financial discount rate (i) (%) applied to the weighted average cost of capital before tax is determined according to the following formula:

In which:

a) The loan interest rate r_d (%) is calculated by the weighted average interest rate of domestic and foreign currency loans, determined according to the following formula:

r_d = D_F x r_d,F + D_D x r_d,D

In which:

b) The pre-tax return on equity (r_e) (%) is determined as follows:

In which:

6. The long-term average electricity delivered and received E_bq (kWh) shall be determined as follows:

a) With regard to the thermal power plant, E_bq shall be determined according to the following formula:

E_bq = P_t x T_max x (1 – K_cs)

In which:

For power plants where T_max is not specified in the Appendix to this Circular, T_max shall be determined based on the calculation parameter set, with reference to data from consulting organizations (if necessary).

For power plants where K_cs is not specified in the Appendix to this Circular, K_cs shall be set to 0 (zero).

b) With regard to the solar power plant, E_bq shall be determined according to the following formula:

E_bq = A x r x H x PR

In which:

The parameters A, r, PR are determined based on one of the following: The calculation parameter set for solar power plants; reference to data from consulting organizations or actual operational data from existing solar power plants.

The parameter H for the North, Central, and South regions shall be determined based on information on basic survey of renewable energy electricity resources published and shared by competent agencies in accordance with the law. If such data is unavailable, the parameter H for the North, Central, and South regions shall be determined by referring to data from consulting organizations or the average annual solar radiation intensity data of operational solar power plants.

c) With regard to the wind power plant, E_bq shall be determined as the long-term average electricity delivered and received, with an expected probability of 50%, based on the calculation parameter set or according to the following formula:

E_bq = 8760 x P_t x k_CF

In which:

The parameter k_CF shall be determined based on one of the following: The calculation parameter set reference to data from consulting organizations or actual operational data from power plants.

d) With regard to the pumped-storage hydropower plant, E_bq shall be designed based on the power system demand and the volume of water pumped into the reservoir, as specified in the approved feasibility study report on construction investment of the projects. If E_bq cannot be determined, it shall be selected based on data from similar-scale pumped-storage hydropower plants where E_bq has been established.

Article 6. Methods to determine the variable cost

1. The variable cost (VC) is a component for recovering fuel costs and other variable costs of the power plant and is determined according to the following formula:

VC = HR x P_nlc x (1 + f)

In which:

For the type of power plants where f is not specified in the Appendix to this Circular, f shall be set to 0 (zero).

2. Price of main fuel (Pole) is regulated as follows:

a) For coal-fired power plants and biomass power plants, P_nlc includes losses, operation and management fees, insurance (if any) and transportation charge;

b) For a combined-cycle gas turbine plant using natural gas, P_nlc is the gas price at the well mouth, including transportation costs to the plant (if any);

c) For a combined-cycle gas turbine power plant using LNG, the main fuel price includes imported LNG prices, LNG import duty (if any), cost for transportation of LNG to the recycling warehouse and cost for storage, re-recycling and distributing gas after re-regeneration (if any);

d) For waste-to-energy power plants (electricity generated from waste), P_nlc takes into account subsidies for fuel collection, transportation, and treatment in accordance with the law on environmental protection law (if applicable).

3. For hydropower plants (excluding pumped-storage hydropower plants), solar power plants, and wind power plants: The variable cost shall be set at 0 (zero).

4. For pumped-storage hydropower plants, the variable cost is a component for recovering water storage costs and is determined based on the electricity consumption during the water storage cycle, the off-peak electricity retail price applicable to the manufacturing sector as per regulations, and the cost of purchasing reactive power capacity.

In which the electricity consumption during the water storage cycle shall be determined based on the approved feasibility study report on investment and construction of the projects. If the electricity consumption during the water storage cycle cannot be determined, it shall be selected based on data from pumped-storage hydropower plants of similar scale where such data is available.

Article 7. Method to determine the fixed operation and maintenance cost

1. The fixed operation and maintenance cost (FOMC) (VND/kWh) is a component for recovering major repair costs, labor costs, and other annual costs, determined according to the following formula:

In which:

2. Total price for operation and maintenance TC_fomc (VND) of the power plant is determined according to the following formula:

TC_fomc = SĐT x P_t x k_O&M

In which:

For power plants where k_O&M is not specified in the Appendix to this Circular, k_O&M shall be determined based on reference data from consulting organizations or actual operational data from similar completed projects.

Article 8. Method for determining the maximum price in the electricity generation price bracket of hydropower plants

The maximum price of hydropower plants P^TĐ (VND/kWh) is determined according to the following formula:

In which:

Chapter III

METHOD FOR DETERMINING THE ELECTRICITY IMPORT PRICE BRACKET FROM LAOS AND CHINA

Article 9. Method for determining the import electricity price bracket

The electricity import price bracket is the maximum price (ceiling price) converted based on the foreign exchange rate in the year of price bracket establishment, applied to each specific country, and determined as follows:

1. In cases where there are provisions in a treaty to which Vietnam is a member (an agreement between the two governments), the maximum price of the electricity import price bracket shall be determined in accordance with the provisions of such agreement.

2. For electricity imports from power plants, the maximum price shall be equal to the average of the avoidable cost tariffs of the Northern, Central, and Southern regions, based on the calculation results of the avoidable cost tariff determined by the national power system and electricity market operator. This shall be submitted to the state management agency in charge of electricity under the Ministry of Industry and Trade, following the method for determining and applying the avoidable cost tariff for small renewable energy power plants as promulgated by the Minister of Industry and Trade.

3. For electricity imports through the national power grid (not involving purchases from power plants), the maximum price shall be the average marginal cost of average electricity for the power source for the base scenario in the latest national power development planning scheme approved by the National Power Development Planning Appraisal Council.

Chapter IV

DOSSIER, ORDER, PROCEDURES, AND APPROVAL OF ELECTRICITY GENERATION PRICE BRACKET AND ELECTRICITY IMPORT PRICE BRACKET

Article 10. Dossier, order, procedures, and approval of the electricity generation price bracket

1. Within 15 days from the date of approval of the feasibility study report on construction investment of the power plant and the appraisal of the basic design, the project owner of the power plant shall provide the feasibility study report and the basic design to Vietnam Electricity.

2. Before November 1 every year, the Vietnam Electricity shall:

a) Propose the calculation parameter sets and select calculation parameters for the electricity generation price bracket of different power plant types;

b) Calculate or hire consultants to determine the calculation parameter set and calculate the maximum price level for the electricity generation price bracket of each power plant type in accordance with Chapter II of this Circular;

c) Prepare the dossier for the electricity generation price bracket calculation in accordance with Article 12 of this Circular and submit it to the state management agency in charge of electricity for appraisal.

3. Within 5 working days from the receipt of the electricity generation price bracket calculation dossier specified in Clause 2 of this Article, the state management agency in charge of electricity shall verify the completeness and validity of the submitted dossier. If necessary, the state management agency in charge of electricity under the Ministry of Industry and Trade may issue a written request for Vietnam Electricity to amend, supplement, or clarify the dossier contents. Within 15 days from the date of receipt of the request for amendment, supplementation, or clarification from the state management agency in charge of electricity under the Ministry of Industry and Trade, Vietnam Electricity shall submit a written explanation addressing the requested contents.

4. Within 25 days from the date of receiving a valid dossier for approval of the electricity generation price bracket, the state management agency in charge of electricity under the Ministry of Industry and Trade shall appraise the electricity generation price bracket and submit it to the Minister of Industry and Trade for approval. In case the electricity generation price bracket of the following year has not been announced, it is allowed to temporarily apply the previous year’s price bracket.

Article 11. Preparation, appraisal, and approval of the electricity import price bracket

1. The national power system and electricity market operator is responsible for preparing the annual avoidable cost tariff and submitting it to the state management agency in charge of electricity under the Ministry of Industry and Trade for appraisal, in accordance with the methods and principles for applying the avoidable cost tariff for small renewable energy power plants as issued by the Minister of Industry and Trade.

2. Within 25 days from the date of receipt of the avoidable cost tariff submitted by the national power system and electricity market operator, the state management agency in charge of electricity under the Ministry of Industry and Trade shall conduct an appraisal and submit the electricity import price bracket for approval by the Minister of Industry and Trade, in accordance with Clause 2 Article 9 of this Circular. In cases where the electricity import price bracket for the following year has not been announced, the previous year’s price bracket shall be temporarily applied.

Article 12. Dossier for approval of the electricity generation price bracket

1. A dossier for approval of the electricity generation price bracket comprises:

a) A written report for appraisal and approval of the electricity generation price bracket;

b) Parameter tables and calculation documents for determining the electricity generation price bracket, in accordance with Articles 4, 5, 6, 7, and 8 of this Circular;

c) Documents related to the parameters used in the calculation of the maximum price level of the electricity generation price bracket.

2. The dossier shall be prepared in paper format and in electronic data format with legal validity equivalent to a written document as prescribed by law. Vietnam Electricity shall responsible for directly submitting one set of the dossier in electronic data format and, if necessary, one set in paper format to the state management agency in charge of electricity under the Ministry of Industry and Trade.

Chapter V

IMPLEMENTATION PROVISIONS

Article 13. Implementation organization

1. The state management agency in charge of electricity under the Ministry of Industry and Trade shall:

a) Appraise and submission to the Minister of Industry and Trade for approval of the electricity generation price bracket;

b) Appraise and submission to the Minister of Industry and Trade for approval of the electricity import price bracket;

2. Vietnam Electricity shall prepare a dossier for calculation of the electricity generation price bracket on an annual basis in accordance with Articles 10 and 12 of this Circular.

3. National power system and electricity market operator shall prepare an annual avoidable cost tariff under Article 11 of this Circular.

Article 14. Transitional provisions

For organizations and individuals investing in solar power plants, wind power plants, or parts of such plants, who have signed power purchase agreements with Vietnam Electricity but do not meet the eligibility criteria for the electricity purchase price specified in the Prime Minister's decisions prior to the effective date of this Circular, the maximum price level of the electricity generation price bracket for each type of plant is determined as follows:

Article 15. Effect

1. This Circular takes effect from February 1, 2025.

2. The following Circulars are hereby annulled:

a) The Minister of Industry and Trade's Circular No. 57/2014/TT-BCT dated December 19, 2014, prescribing the method and order for formulation and promulgation of the electricity generation price bracket;

b) The Minister of Industry and Trade's Circular No. 31/2022/TT-BCT dated November 8, 2022, amending and supplementing a number of articles of the Minister of Industry and Trade's Circular No. 57/2014/TT-BTC dated December 19, 2014, prescribing the method and order for formulation and promulgation of the electricity generation price bracket, and Circular No. 57/2020/TT-BCT dated December 31, 2020, on providing method to determine electricity generation prices and power purchase agreement;

c) The Minister of Industry and Trade’s Circular No. 19/2023/TT-BCT dated November 1, 2023, on providing method to build electricity generation price brackets applicable to solar power plants and wind power plants;

d) The Minister of Industry and Trade’s Circular No. 20/2024/TT-BCT dated October 10, 2024, prescribing the methods for formulating the electricity generation price brackets of solid waste-to-energy power plants and biomass power plants;

dd) The Minister of Industry and Trade’s Circular No. 15/2022/TT-BCT dated October 3, 2022, on providing method to build electricity generation price brackets for transitional solar and wind power plants.

3. Any difficulties arising in the courses of implementation should be reported to the Ministry of Industry and Trade for consideration, supplements and amendment accordingly./.

Appendix

PARAMETERS FOR CALCULATION OF THE ELECTRICITY GENERATION PRICE BRACKET

(Attached to the Minister of Industry and Trade’s Circular No. 09/2025/TT-BCT dated February 1, 2025)

I. Parameters for calculation of electricity generation price

II. Parameters calculation of the price cap of the hydropower plant price bracket

The proportion of electricity generated by season and by hour throughout the year (%) is specified as follows:

The number of peak, normal, and off-peak hours is determined by the Ministry of Industry and Trade.