To complete the electricity generation price mechanism to encourage the use of renewable energy sources in Vietnam

To complete the electricity generation price mechanism to encourage the use of renewable energy sources in Vietnam (Internet image) 

Regarding this issue, LawNet would like to answer as follows:

On December 13, 2023, the National Assembly Standing Committee issued Resolution 937/NQ-UBTVQH15 to supervise the implementation of policies and laws on energy development in the 2016–2021 period.

To complete the electricity generation price mechanism to encourage the use of renewable energy sources in Vietnam

To promote achieved results, overcome limitations and inadequacies, and promptly adapt to the context in the new period, the National Assembly Standing Committee requests the Government and the Prime Minister to direct ministries, branches, and localities, based on their functions, tasks, and powers, to study and implement the recommendations of the Monitoring Team in Report No. 709/BC-ĐGS dated December 4, 2023

In particular, about mechanisms and policies on the energy market; electricity, coal, gas, and gasoline prices; and investing in the development of energy sub-sectors, the National Assembly Standing Committee has proposed the following tasks and solutions:

- For gasoline prices: research to adjust and perfect gasoline storage fee norms. Promulgating the Decree amending and supplementing Decree 95/2021/ND-CP and Decree 83/2014/ND-CP on petroleum business to resolve shortcomings, limitations, and problems in petroleum business activities, ensuring compliance with market conditions and practical requirements. There is a mechanism to bind the responsibilities of petroleum-producing enterprises, ensuring minimum production limits and commitment to supply output.

- For coal and gas prices: research and perfect the mechanism to develop competitive markets for coal and gas. Establish mechanisms and policies on coal prices in imported coal transactions to ensure appropriateness, feasibility, and effectiveness. Calculate and determine the gas electricity price mechanism to ensure investment efficiency in power projects, especially gas-electricity project chains using domestic gas.

- For the energy market: research and promulgate mechanisms and policies to develop and operate a competitive energy market in accordance with the production and business activities of enterprises according to the roadmap for developing a competitive energy market. Identify shortcomings, difficulties, and obstacles, and propose appropriate solutions to promote the fuel conversion process. Establish a mechanism to bind the responsibilities of parties participating in the energy market.

- For electricity prices: complete the electricity generation price mechanism to encourage and promote the strong development of renewable energy sources, including waste electricity and biomass electricity; Completely resolve problems with wind power and solar power projects in the previous period.

Urgently develop and implement a direct power purchase contract mechanism between renewable energy power plants and large electricity consumers; an auction and bidding mechanism for selecting electrical project investors to ensure openness, transparency, harmonization of benefits, and risk sharing between parties; Timely adjustment of retail electricity prices according to actual fluctuations in input parameters such as raw fuel prices and exchange rates, ensuring macroeconomic stability and social security, and at the same time, offset costs and reasonable profits to preserve the business capital of the enterprise, especially promoting competition in the power source stage; Shorten the time between electricity price adjustments.

Soon legislate the management of retail electricity prices in the spirit of "removing all barriers to ensure transparent energy prices determined by the market". Complete the electricity transmission price mechanism to attract investment in the power grid according to each geographical area; do not cross-subsidize electricity prices between customer groups or between regions; separate the costs of production and business activities, public benefit activities, social costs, and corporate governance costs. There is an appropriate price mechanism for the export and import of electricity for countries in the region.

More details can be found in Resolution 937/NQ-UBTVQH15, dated December 13, 2023.

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