Proposing many preferential policies for renewable energy, opening foreign capital for offshore wind power

The Ministry of Industry and Trade has just released a draft decree detailing a number of articles of the Electricity Law on renewable energy and new energy with a series of new incentive policies.

Developing offshore wind power and new energy sources will have preferential policies - Photo: T.TR.

Accordingly, on the basis of the Electricity Law (amended) passed by the National Assembly on November 30, expected to take effect on February 1, 2025, the Ministry of Industry and Trade has issued a draft detailing a number of articles of the Electricity Law on renewable energy and new energy for comments.

Many preferential policies on taxes and fees

The draft has provided regulations on the development of renewable energy and new energy with preferential policies. In particular, solar and wind power projects with electricity storage systems and connections to the national power grid will be prioritized for mobilization and enjoy tax policies related to storage.

At the same time, power projects produced from 100% green hydrogen, 100% green ammonia or a 100% mixture of these two sources will also enjoy preferential mechanisms and policies.

Clean energy projects in the list of industries and professions with special investment incentives are also exempted from fees for using sea areas during construction, and receive a 50% reduction in this incentive for 9 years from operation.

In addition, land use fees and land rent will be exempted during construction period.

After the construction period, exemption and reduction are implemented according to the provisions of law on investment and land.

The minimum long-term contract electricity output is 80% of the loan principal repayment period, but not more than 12 years for projects selling electricity to the national power system.

However, investors in renewable energy and new energy projects are responsible for monitoring primary energy parameters and electricity output statistics. From there, they report data to the Ministry of Industry and Trade according to regulations. Projects that have ceased operations must be responsible for completing the dismantling.

The Prime Minister approved the investment policy for new energy and renewable energy projects for offshore wind power projects producing electricity for one of the following purposes: Providing electricity for the national power system; producing green hydrogen; producing green ammonia; other domestic needs; exporting electricity.

In addition, offshore wind power projects do not require bidding to select investors and need to be developed to ensure security of electricity supply; projects proposed by enterprises and have joint ventures or associations with foreign investors, but must ensure that the proportion of shares and capital contributions of the enterprise proposing the project in the economic organization is over 50%.

Conditions for foreign investors to participate in offshore wind power

In this draft, the Ministry of Industry and Trade builds many contents on offshore wind power projects, which will be renewable energy projects in the list of industries and professions with special investment incentives such as incentives of exemption of fees for using sea areas during construction and 50% reduction of this amount for 12 years during operation; exemption of land use fees, land rent; long-term minimum contract electricity output of 50%.

Notably, if an enterprise is 100% state-owned, it will be exempted from guaranteeing the implementation of the investment project according to the provisions of the Investment Law; and the Prime Minister will consider and decide to grant credit exceeding the limit for offshore wind power projects according to the provisions of the Law on Credit Institutions.

When implementing a project, foreign investors must ensure market access conditions for foreign investors, choose the form of investment and carry out investment procedures according to legal regulations, with a maximum capital ownership ratio of 65% when there is participation of domestic investors.

Investors must implement at least one project of equivalent scale in Vietnam or in the world; have financial capacity, capital mobilization plan or loan commitment, human resources, expertise, experience. Have total audited net asset value in the last three years greater than the total expected investment of the project. The project must also have the consensus of the Ministry of National Defense, Ministry of Public Security, Ministry of Foreign Affairs.

The selection of offshore wind power investors to sell electricity to the national power system is carried out in accordance with the provisions of the law on bidding and electricity.

Specifically, the ceiling price of electricity in the bidding documents is not higher than the maximum price of the electricity generation price frame; the winning electricity price for selecting investors is the maximum electricity price for the electricity buyer to negotiate with the winning investor.

Source: https://tuoitre.vn/de-xuat-nhieu-chinh-sach-uu-dai-nang-luong-tai-tao-mo-von-ngoai-cho-dien-gio-ngoai-khoi-20241219093307576.htm