On 12 April 2019, the Ministry of Industry and Trade of Vietnam ("MOIT") released the third updated draft (the "Third Draft") of the Decision of the Prime Minister on the mechanism for encouraging the development of solar power projects in Vietnam (the "Draft Decision"). Most notably, the Draft Decision provides for a second Feed-in-Tariff ("FiT") program with FiT rates varying by location for application during the period from 1 July 2019 until 31 December 2021.
Compared to the second draft, released in February 2019 ("Second Draft"), the Third Draft has made certain improvements for investors, including, among other things:
- extending the duration of the 2nd FiT program to apply for two-and-ahalf years, from 1 July 2019 until 31 December 2021 (instead of being until 30 June 2021 under the Second Draft);
- increasing the FiT rates for "Floating solar power projects" by about 5.7%;
- incorporating the special policy for Ninh Thuan Province of Vietnam allowing certain solar power projects in Ninh Thuan Province with the total combined capacity cap of 2,000 MW achieving actual commercial operation date ("COD") by the end of 2020 to be eligible for the extended FiT 1 of 9.35 US cents per kWh.