HANOI, March 14 (Bloomberg): Renewable energy companies are urging Vietnam’s government to change power price polices that threaten bankruptcy for generators and risks turning away investors.
The government’s policies on renewable energy are at risk of losses and "have deeply unnerved” investors, according to a letter seen by Bloomberg and sent March 14 to Prime Minister Pham Minh Chinh and other officials.
The "instability of clean energy development policies” will reduce the government’s ability to lure foreign investment, according to the letter signed by 36 companies that are developing wind and solar projects.
The letter comes as the government’s anti-corruption campaign has paralyzed decision-making and slowed the completion of a long-term national energy road map. That’s complicating the nation’s goal of transitioning away from coal as part of an effort to hit net zero emissions by 2050.
Vietnam’s government didn’t immediately respond to multiple requests for comment.
The companies are urging the government for more favorable prices, approval to immediately begin providing power to the grid, and new rules to allow generators to sell energy directly to customers.
Vietnam drove massive interest in renewable energy projects when it ordered state-owned Vietnam Electricity Group, or EVN, to buy the power at high rates via a system called feed-in-tariffs. However, developers had to get their projects into commercial operation before Dec. 31, 2020 and Nov. 1, 2021 for solar and wind power, respectively, to lock in those prices and sell power to the grid.
The pandemic slowed plans to start 84 wind and solar projects, resulting in them missing the deadline to obtain favorable pricing, the investors said in the letter.
Those projects are now stuck in limbo, and a new lower price promulgated by the government risks bankruptcy, according to the petition. - Bloomberg
