Circular 21: Regulating 03 principles for pricing of ancillary services in Vietnam

According to Article 3 of Circular No. 21/2015/TT-BCT of the Ministry of Industry and Trade of Vietnam, 03 principles for pricing of ancillary services are specified as follows:

1. The pricing of services for fast boot reserve, cold boot reserve and mandatory maintenance of electric power system security during power generation adopts the principles of adequately compensating for reasonable and valid actual expenses and generating rational annual profit for thermal power plants providing ancillary services. Price is exclusive of value added tax and environmental protection fee levied on solid waste. The price of ancillary service for the said entity consists of:

- Fixed price for ancillary service providers' recovering of total fixed cost of the provision of ancillary services in the year when such price takes effect;

- Variable price for ancillary service providers’ recovering of fuel and material costs for production of electricity as per a dispatching order by the operator of electric power system and market;

- Generator booting price for the recovery of the power generator's costs of fuel and electricity consumed when a generator in hot, warm or cold shutdown condition is switched on to produce electricity as per a dispatching order by the operator of electric power system and market.

2. For frequency control service, the principles for mobilization and pricing are:

- The operator of the electric power system and market mobilizes strategic multi-target hydroelectric plants of Vietnam Electricity Corporation to provide frequency control service. Reasonable and valid actual costs for providing frequency control service are posted into the electricity production and trading costs of strategic multi-target hydroelectric plants;

- For the plants participating directly in the electric power market, the frequency control service provision cost is settled as per the regulation of the operation of the competitive power market as issued by the Ministry of Industry and Trade, and relevant regulations.

3. For spinning reserve service, the providers of spinning reserve service are power plants participating directly in the power market. The method for pricing of spinning reserve service is governed by Title 3 of this Chapter.

View more details at Circular No. 21/2015/TT-BCT of the Ministry of Industry and Trade of Vietnam, effective from August 07, 2015.

Ty Na

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