Many provinces have proposed to the Government and the Ministry of Industry and Trade to consider and extend the FIT prices under Decision No. 39 for the on-going projects in the area, because the progress is being affected by COVID-19.
Simultaneously sending petitions
The People’s Committees of Tra Vinh, Gia Lai and Soc Trang provinces simultaneously submitted written proposals to the Prime Minister and the Ministry of Industry and Trade to assess the possibility that wind power projects in the area could not be completed and commercially operated before November 2021 to enjoy the preferential price of 9.8 cents/kWh (according to Decision 39).
The reason given by the localities is that the complicated development of COVID-19 has led to the wind turbine supplying progress being affected (the overseas equipment suppliers are behind schedules, transportation of heavy equipment is difficult due to social distancing), not only the immigration activities of experts and workers, but also the import and export of goods are interrupted, material prices are abnormally high, etc.; as a result, many wind power projects in the above provinces are on the threshold of slow operation.
Therefore, the localities have proposed to the Prime Minister and the Ministry of Industry and Trade to consider and approve the time extension to apply the FIT pricing mechanism for the projects under their respective localities.
According to Tra Vinh Provincial People’s Committee, so far Tra Vinh has approved the investment policy of 8 wind power projects with a total capacity of 570MW. Among these, 6 projects are being supported by the local to speed up construction, including: Tra Vinh – Korea 48 MW wind farm (phase 1), V1-2 and V1-3 wind farms (48 MW each), Duyen Hai wind farm (48 MW), Hiep Thanh wind farm (78 MW), Dong Hai 1 wind farm (100 MW).
Through monitoring the actual situation along with the investors’ own assessment, it is likely that many projects are late for commercial operation before October 31, 2021. Therefore, Tra Vinh province proposed to the Prime Minister to approve the time extension to apply the FIT pricing mechanism for wind power projects in the areas until at least the end of April 2022.
In Soc Trang province, there are a total of 20 wind power projects (total capacity of 1,435 MW) approved in the local wind power development planning as well as power planning VII. Currently, the province has approved policy for 16 projects (total capacity about 1,095 MW), of which 11 projects are under construction.
With the impact of COVID-19 leading to a delay in construction progress, making it difficult to ensure timely operation of the FIT price, the Soc Trang Provincial People’s Committee proposed the Ministry of Industry and Trade to submit to the Prime Minister an extension of the FIT pricing period until the end of March 31, 2022. The beneficiaries of the extension are wind power projects under construction (with signed PPAs, equipment procurement contracts, feasibility study reports, technical designs, etc.).
Wind farm projects likely to get delayed
According to updated data of the Vietnam Electricity Corporation (EVN), by the end of August 3, 2021, a total of 106 wind power plants have sent documents for registering energization, grid connection, testing, commercial operation dates (COD). The total registered testing capacity for COD of these 106 wind farms is 5,655.5 MW.
However, according to wind power investors, the registration of investors is an administrative procedure, but to complete the project on schedule in the current conditions, they have to face many difficulties. Currently, out of 106 factories submitting documents, there are still projects that have not completed site clearance. Meanwhile, the time limit for enjoying the preferential price is just over 2 months until the FIT prices for wind power end after October 31 based on Decision 39.
According to a wind power investor, to meet the deadline for submitting the documents for acceptance testing for the commercial operation date (COD) before October 31, 2021, the investors of wind farms must send documents and dossiers according to regulations to the electricity buyers (EVN) no later than August 3, 2021. However, in practice, whether it can be implemented or not depends on the progress of the investors. It is forecasted by the investors that the wind power capacity for operation before October 31, 2021 will be lower than the capacity registered with EVN.
According to the Institute of Energy (of the Ministry of Industry and Trade), currently, the total capacity of RE (RE) sources that have been approved to supplement the planning until 2025 is about 25,500 MW (excluding rooftop solar power projects), including 13,900 MW of solar farms and 11,500 MW of wind farms.
Thus, the remaining 5,000 MW of solar power and 6,144 MW of wind power have been approved for planning but have not been put into operation in 2021.
However, at present, there is no specific information on the encouraging mechanisms for RE development for the period after October 2021, so wind power projects are going to be at risks if they are not commercially operated before November, 2021.
According to EVN’s updated report on the balance of electricity supply and demand in the 2021-2025 period, if the power sources are behind schedule, and RE sources stop being deployed after October 2021, the system will experience a shortfall in power supplies. The shortfall could reach 27.7 billion kWh by 2025.
Source: tuoitre.vn
