popular articles

Vietnam reforms and modernizes its power purchase mechanism

Vietnam's new Direct Power Purchase Arrangement (DPPA) promises to boost the adoption of renewable energies, although challenges remain regarding grid connectivity.
Mécanisme d'achat direct d'énergie

Please share:

Vietnam recently introduced a new Direct Power Purchase Mechanism (DPPA), designed to enable direct power purchases between generating units and large electricity consumers. This mechanism is seen as a major opportunity to accelerate the adoption of renewable energies in the country, according to sources present at the Solar & Storage Vietnam 2024 conference held in Ho Chi Minh City on July 10 and 11.
However, while the overall outlook is positive, some voices are expressing concern about the lack of detail in the mechanism. A Vietnamese venture capitalist has described 2024 as a “pivotal year” for the take-off of renewable energies. “With the DPPA, more renewable energy capacity should emerge by 2030. This should also boost the market for Renewable Energy Certificates (I-RECs) in Vietnam,” he said.

Direct Energy Purchasing mechanisms

The DPPA decree introduces two main mechanisms. The first involves direct purchase via a private transmission line, where entities must sign a power purchase agreement between renewable energy generators and large electricity users. These customers can also purchase additional electricity from Vietnam Electricity (EVN).
The second mechanism concerns direct purchasing via the national grid. Here, entities will sign a forward contract between a renewable energy production unit and a large customer or authorized retail supplier in a specific area. In addition, renewable energy generators will have to sell the electricity they produce on the competitive SPOT wholesale electricity market.

Challenges and opportunities

Despite a positive reception, some market participants pointed to the lack of detail in the decree. “Although the DPPA policy has opened up new avenues for companies wishing to bypass the EVN to source renewable energy, grid connectivity is another issue yet to be resolved,” said a representative of a Vietnam-based energy construction company.
One venture capitalist described the DPPA as a “catalyst”, enabling renewable energy generators to meet customer demands. “But feasibility tests still need to be carried out before renewable energy reaches the grids in local municipalities.”

Future prospects and development

In a presentation by Nguyen Ngoc Phuc Dang, EVN PECC3 legal specialist, it was stated that rooftop solar projects can participate in the DPPA via private transmission, while solar projects over 10 MW can participate in the DPPA either via the grid or via private transmission.
Experts predict an increase in investment in rooftop solar projects, in line with Vietnam’s goal of carbon neutrality by 2050. “Demand for rooftop solar in the commercial and industrial sector is high. With the publication of the DPPA, I now look forward to an executive order for rooftop solar,” said Samresh Kumar of SkyX Solar.
Although Vietnam’s DPPA represents a significant step forward for the adoption of renewable energies, major challenges remain, particularly in terms of grid connectivity and operational details. Nevertheless, the long-term outlook for the sector is promising, with an expected increase in investment and installed capacity.

Register free of charge for uninterrupted access.

Publicite

Recently published in

In London, global officials gather to discuss energy security amid rising geopolitical tensions. Disagreements persist on the role of renewable energy in meeting global demand.
As a parliamentary debate approaches, twenty energy organizations urge lawmakers to act to reduce France's reliance on fossil fuels by accelerating the electrification of uses.
As a parliamentary debate approaches, twenty energy organizations urge lawmakers to act to reduce France's reliance on fossil fuels by accelerating the electrification of uses.
Nigeria aims to increase its electricity production capacity by 4,000 MW by 2026 to meet the growing demand of the industrial sector, in a context of reforms and partnerships with international players.
Nigeria aims to increase its electricity production capacity by 4,000 MW by 2026 to meet the growing demand of the industrial sector, in a context of reforms and partnerships with international players.
EDF’s outgoing CEO, Luc Rémont, claims French electricity will be more competitive than that of the United States, despite ongoing criticisms from industrialists about high tariffs.
EDF’s outgoing CEO, Luc Rémont, claims French electricity will be more competitive than that of the United States, despite ongoing criticisms from industrialists about high tariffs.
Donald Trump's aggressive trade policies and regulatory uncertainty in the United States are slowing investments in wind, solar, and energy storage, pushing the sector into a period of caution and market volatility.
The French government activates five funding mechanisms to support industrial decarbonisation projects through the France 2030 plan, targeting major sites, SMEs and high-emission industrial zones.
The French government activates five funding mechanisms to support industrial decarbonisation projects through the France 2030 plan, targeting major sites, SMEs and high-emission industrial zones.
Paris releases a new €400mn funding package to support industrial projects aimed at reducing emissions under the France 2030 programme.
Paris releases a new €400mn funding package to support industrial projects aimed at reducing emissions under the France 2030 programme.
The massive withdrawal of American financial support and the reduction of European aid could jeopardize energy projects in Africa, profoundly altering their financing structure and the continent's commitments.
The massive withdrawal of American financial support and the reduction of European aid could jeopardize energy projects in Africa, profoundly altering their financing structure and the continent's commitments.
The Vietnamese government has raised its renewable energy targets in a new version of its national energy plan, responding to continued growth in electricity demand.
A massive outage plunged Puerto Rico into darkness on Wednesday, leaving approximately 1.1 million households without electricity after an unexpected shutdown of all its power plants.
A massive outage plunged Puerto Rico into darkness on Wednesday, leaving approximately 1.1 million households without electricity after an unexpected shutdown of all its power plants.
The Czech Republic has ended its dependency on Russian oil after more than six decades, a major shift made in response to Russia's invasion of Ukraine.
The Czech Republic has ended its dependency on Russian oil after more than six decades, a major shift made in response to Russia's invasion of Ukraine.
The European power purchase agreement (PPA) market for renewables reached 19 GW of new capacity in 2024, with growing momentum for hybrid contracts including storage.
The European power purchase agreement (PPA) market for renewables reached 19 GW of new capacity in 2024, with growing momentum for hybrid contracts including storage.
Industry Minister Marc Ferracci criticised the Rassemblement National's stance on energy, accusing it of hindering planned investments in renewables in favour of fossil fuel imports.
Bill 69 sparks protests in Saint-Jean-sur-Richelieu, where several organisations denounce a risk of privatising Quebec’s electricity sector.
Bill 69 sparks protests in Saint-Jean-sur-Richelieu, where several organisations denounce a risk of privatising Quebec’s electricity sector.
Wind and solar energy accounted for nearly one-fifth of Türkiye’s electricity generation in 2024, according to an analysis by think tank Ember, driven by a strong increase in installed capacity.
Wind and solar energy accounted for nearly one-fifth of Türkiye’s electricity generation in 2024, according to an analysis by think tank Ember, driven by a strong increase in installed capacity.
The Acerez consortium has signed a 35-year agreement to build and operate over 240 km of high-voltage lines in Australia, marking the country's first public-private partnership in the sector.
The Acerez consortium has signed a 35-year agreement to build and operate over 240 km of high-voltage lines in Australia, marking the country's first public-private partnership in the sector.
France’s multi-year energy strategy shifts focus away from photovoltaics toward flexibility measures, including battery storage, to address growing imbalances in the electricity market.
France’s energy regulator unveils its first observatory dedicated to renewable electricity purchase agreements, highlighting a recent but still marginal growth compared to State-backed mechanisms.
France’s energy regulator unveils its first observatory dedicated to renewable electricity purchase agreements, highlighting a recent but still marginal growth compared to State-backed mechanisms.
The French government plans to adopt within two weeks a decree outlining the decade’s energy objectives, restarting nuclear power and preparing for a parliamentary debate on energy sovereignty.
The French government plans to adopt within two weeks a decree outlining the decade’s energy objectives, restarting nuclear power and preparing for a parliamentary debate on energy sovereignty.
The expansion of solar and wind capacity is multiplying hours of negative prices on European electricity markets, weakening the sector's economic balance while reshaping export and storage dynamics.
The expansion of solar and wind capacity is multiplying hours of negative prices on European electricity markets, weakening the sector's economic balance while reshaping export and storage dynamics.
Despite a predominantly decarbonised electricity production, demand in Europe remains subdued, hindered by uncompetitive prices and limited industrial usage.
Data from think tank Ember reveals that fossil fuels accounted for just 49.2% of US electricity generation in March 2025, marking an unprecedented threshold.
Data from think tank Ember reveals that fossil fuels accounted for just 49.2% of US electricity generation in March 2025, marking an unprecedented threshold.
The global electricity mix shifted in 2024 with 40.9% of production from low-carbon sources, according to Ember, driven by historic solar power growth.
The global electricity mix shifted in 2024 with 40.9% of production from low-carbon sources, according to Ember, driven by historic solar power growth.
Facing recurring shortages, Tajikistan tightens energy laws by introducing prison sentences of up to ten years for electricity fraud to protect its ageing hydropower network.
Facing recurring shortages, Tajikistan tightens energy laws by introducing prison sentences of up to ten years for electricity fraud to protect its ageing hydropower network.

Advertising