On 28 October 2020, the Ministry of Industry and Trade (MOIT) issued Official Letter No.8159/BCT-DL to collect comments from other Ministries and relevant agencies on solutions for difficulties in wind energy project development. The comments were combined into a Draft report for the Prime Minister's review and approval.
A notable provision of the Draft report is for wind power projects that have been supplemented into the power development planning and do not meet the COD deadline for current wind FiT rate of November 2021, the new applicable FiT rate shall be:
No. Category FiT rate for onshore projects (Uscent/kWh) FiT rate for offshore projects (Uscent/kWh)
1 Projects reaching COD from November 2021 to December 2022 7,02 8,47
2 Projects reaching COD in 2023 6,81 8,21
In addition, the Draft report also proposes to extend the current FiT rate deadline to 31 December 2023, instead of November 2021.
As stated in our previous articles on FiT rate for wind power
projects, the need to extend the deadline for current FiT rate is
essential because the projects waiting to be included in the
Revised PDP VIII is unlikely to have commercial operation date
before November 2021, because:
" The supplement into PDP for new wind power sources was
suspended for more than 1 year (from October 2018) because there
were no guidelines to implement the Planning Law;
" The construction of wind power projects takes more time than
that of solar power projects. For feasibility study reports,
investors must carry out wind measurement for at least 12 months.
Moreover, wind turbines are mostly imported from abroad, which
costs investors extra time, especially when there is unexpected
delay of equipment delivery (e.g. due to Covid-19).
Originally Published by Duane Morris, November 2020
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