Decision No. 08/2020/QD-TTg amending and supplementing certain articles of Decision No. 24/2014/QD-TTg dated March 24, 2014 of the Government on mechanisms to support the development of biomass power projects in Vietnam.

Pursuant to …;

Amending and supplementing certain articles of Decision No. 24/2014/QĐ-TTg dated March 24, 2014 of the Prime Minister on mechanisms to support the development of biomass power projects in Vietnam

dated March 24, 2014 of the Prime Minister on mechanisms to support the development of biomass power projects in Vietnam

support the development of biomass power projects in Vietnam

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Pursuant to the Government Organization Law dated June 19, 2015;

Pursuant to the Electricity Law dated December 3, 2004; and the Law Amending and Supplementing Certain Articles of the Electricity Law dated November 20, 2012;

Pursuant to the Investment Law dated November 26, 2014; and the Law Amending and Supplementing the Investment Law dated November 22, 2016;

Pursuant to the Law on Construction promulgated on June 18, 2014;

Pursuant to the Planning Law dated November 24, 2017;

At the proposal of the Minister of Industry and Trade;

The Prime Minister promulgates this Decision amending and supplementing certain articles of Decision No. 24/2014/QĐ-TTg dated March 24, 2014 of the Prime Minister on mechanisms to support the development of biomass power projects in Vietnam.

Article 1. Amending and supplementing certain articles of Decision No. 24/2014/QĐ-TTg dated March 24, 2014 of the Prime Minister on mechanisms to support the development of biomass power projects in Vietnam

1. Amend Clause 1 and Clause 2 of Article 1 as follows:

"1. This Decision regulates the mechanism to encourage the development of biomass power projects connected to the grid in Vietnam, hereinafter referred to as biomass power projects.

2. The subjects to which this Decision applies include organizations and individuals participating in electricity activities related to the development of biomass power projects."

2. Amend Clause 1 and Clause 2 of Article 2 as follows:

"1. The buyer of electricity is the Vietnam Electricity Corporation or its authorized member units or organizations that take over the rights and obligations of the aforementioned organizations in accordance with the provisions of the law.

2. The seller of electricity is organizations and individuals participating in power generation activities from biomass power projects or organizations and individuals taking over the rights and obligations of the aforementioned organizations and individuals in accordance with the provisions of the law."

3. Repeal Clause 8, Clause 10, Clause 11 of Article 2; Article 3, Article 4, Article 5.

4. Amending Clause 6 as follows:

"Article 6. Investment in constructing biomass power projects

1. The development of biomass power projects shall be carried out according to planning. The review and approval for supplementing biomass power projects into the plan shall be implemented in accordance with the current laws on planning. Biomass power projects included in approved power development plans at all levels shall be implemented in accordance with the provisions on transition under Article 59 of the Planning Law 2017 and Resolution No. 751/2019/UBTVQH14 dated August 16, 2019 of the Standing Committee of the National Assembly explaining some articles of the Planning Law 2017.

2. The main equipment of biomass power projects must meet technical standards as prescribed. The quality of electricity from biomass power projects must meet technical requirements regarding voltage, frequency, and operational requirements of the national power system as prescribed.

3. The construction of biomass power projects shall be carried out in accordance with the laws on investment, construction, electrical safety, land, fire prevention and fighting, environmental protection, and other relevant laws."

5. Amend Article 7 as follows:

"Article 7. Connecting biomass power projects to the power grid

1. The seller of electricity is responsible for investing, installing, operating, and maintaining the electricity metering equipment, transmission lines, and step-up substations (if any) from the power plant of the seller to the point of interconnection with the grid of the buyer; organizing the inspection, calibration, and testing of electricity metering equipment in accordance with the current laws on measurement.

2. The point of interconnection shall be agreed upon between the seller and the buyer based on the principle of ensuring the transmission capacity of the power plant of the seller, in line with the approved planning. In case the point of interconnection differs from the location of the metering equipment, the seller shall bear the loss of electricity on the interconnection lines and the transformer losses of the power plant."

6. Repeal Article 8, Article 9, Article 10.

"7. Amend Article 11 as follows:"

"Article 11. Obligation to purchase electricity from power projects

1. The buyer of electricity has the responsibility to purchase all electricity generated from biomass power projects in compliance with the regulations on the operation of the national power system and technical standards and specifications of the power industry; prioritizing the full utilization of the installed capacity and electricity production of biomass power projects.

2. The model power purchase agreement is mandatory for biomass power projects in the sale and purchase of electricity between the seller and the buyer.

3. The term of the power purchase agreement for biomass power projects is 20 years from the date of commercial operation. After this period, the extension of the agreement or signing a new agreement shall be carried out in accordance with the laws in effect at the time of extension or signing a new agreement."

8. Repeal Article 12, Article 13.

9. Amend Article 14 as follows:

"Article 14. Electricity price for biomass power projects

1. For cogeneration projects: The electricity purchase price at the delivery point is VND 1,634/kWh equivalent to 7.03 US cents/kWh, based on the central exchange rate of the Vietnamese Dong against the US Dollar published by the State Bank of Vietnam on February 21, 2020.

2. For non-cogeneration projects: The electricity purchase price at the delivery point is VND 1,968/kWh equivalent to 8.47 US cents/kWh, based on the central exchange rate of the Vietnamese Dong against the US Dollar published by the State Bank of Vietnam on February 21, 2020.

3. The electricity purchase prices specified in Clauses 1 and 2 of this Article do not include value-added tax and will be adjusted based on fluctuations in the US Dollar (equivalent to US cents/kWh), using the central exchange rate of the Vietnamese Dong against the US Dollar published by the State Bank of Vietnam on the day the seller issues the payment invoice.

4. Biomass power projects that have been generating electricity before the issuance of this Decision shall apply the electricity purchase prices specified in Clauses 1 and 2 of this Article from the effective date of this Decision for the remaining term of the existing power purchase agreements.

5. The costs of purchasing electricity from biomass power projects as stipulated in Clauses 1 and 2 of this Article shall be calculated and fully reflected in the input parameters of the annual retail electricity price proposal of the Vietnam Electricity Corporation.

6. Biomass power projects applying the electricity purchase prices as stipulated in this Article shall not be eligible for pricing mechanisms for project output under other current regulations."

10. Repeal Article 15.

11. Amend Article 16 as follows:

Article 16. Responsibilities of relevant organizations and individuals

1. Ministry of Industry and Trade

a) Organize, guide, and coordinate with provincial people's committees under the central government to inspect and urge the implementation of this Decision.

b) Issue model Power Purchase Agreements applicable to biomass power projects as prescribed in this Decision.

c) Issue regulations and technical standards for equipment, acceptance, and trial operation of biomass power plants.

d) Monitor and propose adjustments to the purchase price for biomass power projects, report to the Prime Minister for consideration and decision.

2. Provincial People's Committees under the Central Government

a) Coordinate and support investors in compensation, land clearance, infrastructure, human resources for investment, implementation, and development of biomass power projects within their jurisdiction.

b) Supervise, monitor, and inspect the implementation of biomass power projects in their locality within their authority.

c) Perform state management tasks related to biomass power activities in their locality in accordance with current laws.

3. Vietnam Electricity Corporation:

The Vietnam Electricity Corporation shall be responsible for fully calculating the costs of purchasing electricity from biomass power projects and incorporating them into the input parameters in the annual electricity sales price plan of the Vietnam Electricity Corporation, to be submitted to the competent authority for approval.

4. The seller of electricity

Shall comply with system operation regulations, transmission system regulations, distribution system regulations, metering system regulations, and related regulations.

Article 2. Effective Date

1. This Decision takes effect from April 25, 2020.

2. Ministers, heads of ministerial-level agencies, heads of governmental agencies, Chairmen of provincial people's committees under the central government, heads of agencies, units, and organizations related to the development of biomass power projects in Vietnam shall be responsible for implementing this Decision./.