14 Solar Projects Under Investigation for Unlawful FIT Profits
The Ministry of Industry and Trade (MoIT) has provided detailed conclusions in an official document sent to Vietnam Electricity (EVN) regarding a government inspection conducted on April 28. The inspection focused on the implementation of national electricity development plans 7 and 7.1. As a result of the inspection, the MoIT has instructed EVN to thoroughly investigate and provide information on 14 solar projects that have either currently or previously benefited from the preferential tariff scheme in violation of Resolution 115 guidelines.
EVN has also been directed to review all grid-connected solar and wind projects that have received commercial operation date approvals under the feed-in tariff (FIT) system. The examination is expected to cover various aspects, including agreement formations, power purchase agreements, inspection conditions, commercial operation recognitions, and payment procedures.
The key issue at hand is why these 14 solar projects have been identified as improperly benefiting from the tariff scheme. The government inspection found that although Resolution 115 specified that the beneficiaries of the 9.35 US cents/kilowatt hour rate should be solar power projects approved by the prime minister or listed in the national power development plan with a total capacity of 2,022MW, the MoIT later expanded the application of the FIT rate to other projects in different power development plans. Consequently, 14 projects with a total capacity of 964MW, including Hacom Solar, Sinenergy Ninh Thuan 1, and Thuan Nam Duc Long, among others, were found to have been granted the preferential FIT rate improperly. By June 30, 2022, EVN had paid an additional $62.49 million due to these projects.
The inspection agency attributed the responsibility for this situation to the MoIT. In addition, the MoIT’s Inspection Agency has urged EVN to collaborate with provincial power companies to review large-scale rooftop solar systems with 1MW capacity developed on agricultural and forestry lands under the farming investment model.
The inspection agency has recommended that the MoIT take the lead and coordinate with relevant ministries to find appropriate economic solutions for the 14 solar projects allegedly benefiting improperly. Furthermore, there is a call to review large-scale rooftop solar systems developed on agricultural and forestry lands under the farming investment model, with actions to be taken in accordance with regulations.