Trade ministry to suggest new calculation for solar power prices
Trade ministry to suggest new calculation for solar power prices
Solar power prices should be calculated according to their thermal radiation zones, Deputy Minister of Industry and Trade Do Thang Hai proposed at a regular Government meeting in Hanoi on Thursday.
The official noted that the ministry had presented its proposal to the Government on Wednesday after receiving recommendations from international experts and organizations.
He added that the ministry will submit to the Government new scenarios for solar power prices in two regions on September 15, where the new prices will be based on levels of solar radiation in these regions rather than the current flat rate of 9.35 U.S. cents per kilowatt hour.
In previous scenarios, the ministry set out four levels of prices corresponding to four ranges of solar radiation.
However, based on the recommendations of ministries, agencies and the Government’s standing board, the ministry later switched to two levels of prices for two regions.
The first region comprises six provinces with high solar radiation, including the south-central coastal provinces of Binh Thuan, Ninh Thuan and Phu Yen and the central Highlands province of Daklak, while the other covers all the remaining localities.
As such, the price of solar power in the first region is projected at VND1,916, or 8.38 U.S. cents per kilowatt hour, and VND1,758, or 7.09 U.S. cents in the second region.
The new power purchase price is expected to apply to grid-connected solar power projects whose commercial operations will start between early July this year and late 2021.
An official with the Electricity and Renewable Energy Authority highlighted the 2.5-year power purchase period, resulting from the investment reduction in solar power projects each year. Also, solar cell production technologies are still under development, while solar power prices are forecast to become increasingly competitive.
The cost of producing solar panels has fallen by 30% since 2017. The figure is expected to drop a further 10% in the years to come.
Data from the ministry revealed that the total solar power capacity of the proposed projects adds up to 25,000 megawatts (MW) and that of wind power, 16,500 MW.
As of late June, 89 solar power plants, mainly in Ninh Thuan and Binh Thuan, had been commissioned, with a total capacity of nearly 4,500 MW, far exceeding the planned capacity of 850 MW by 2020 and causing problems for transmission lines.
The Vietnam Electricity Group repeatedly reduced the surplus solar power to the transmission grid to protect its electricity system.
Roughly 400 solar power projects are pending for addition to the National Power Development Plan VII, but they face hurdles posed by the new Planning Law, which took effect early this year.
