Extend feed-in-tariff incentives, say foreign business associations

An existing plan to lower the feed-in tariffs for wind power companies by next November does not give enough time for developers to begin operating their plants. There are 91 wind power projects that are awaiting licenses, the British Chamber of Commerce Vietnam (BritCham) said in a statement at the recent Vietnam Business Forum 2020.

The Ministry of Industry and Trade had earlier proposed that this rate be reduced to 7.02 U.S. cents and 8.42 cents respectively for projects that begin operating from November 2021 and December 2022.

But the American Chamber of Commerce in Vietnam (AmCham Vietnam) said onshore wind power projects typically take about two years of study and development, and developers are facing challenges in meeting the deadline to enjoy the incentive tariffs.

Investors are not willing to commit to projects set to begin operation starting 2022 if they do not have a confirmation about the incentive feed-in tariffs being extended, it said.

The existing feed-in tariffs on offshore projects should be prolonged until the end of 2023, it added.

The BritCham also proposed extending price incentives for solar power projects.

The government had in April scrapped its incentive tariff rate for solar power and approved a new price of VND1,640 (7.09 U.S. cents) a kilowatt-hour for this year, down 24 percent from the previous incentive rate of 9.35 U.S. cents.

Other organizations proposed more changes in the energy sector.

The Japan Business Association in Vietnam (JCCI) said that the government needs to complete its infrastructure like storage and equipment first to develop the liquefied natural gas energy industry.

The Korean Chamber of Commerce in Vietnam (Kocham) suggested that Vietnam reconsiders a plan to build nuclear power plants that was scrapped in 2016.