Decree No. 135/2024/ND-CP on the mechanism to encourage the development of self-production and self-consumption rooftop solar power

To promote renewable energy use and minimize environmental impact, the Government of Vietnam issued Decree No. 135/2024/ND-CP on October 22, 2024, which establishes and encourages the development of self-production and self-consumption rooftop solar power. This decree represents an important step toward realizing the strategy for sustainable energy development.

Key points of Decree No. 135/2024/ND-CP

1. Scope and applicability:

Decree No. 135/2024/ND-CP applies to organizations and individuals in Vietnam involved in developing rooftop solar power for self-production and self-consumption purposes. Rooftop solar power systems may be either connected or not connected with the national power system and can allow direct electricity sales between renewable energy producers and large consumers under government regulations.

 2. Development principles:

The development of rooftop solar power must ensure transparency, fairness, and equality among stakeholders. The decree mandates compliance with regulations regarding investment, construction, environment, safety, and fire safety to ensure the safety and stability of the national power system.

3. Encouragement policies:

Organizations and individuals installing self-production and self-consumption rooftop solar power systems are exempted from an electricity license without limits on generating capacity in cases, such as not connected to the national power systems, systems for preventing electrical backflow devices, or household/single-family house with a capacity of under 100kW.

Rooftop solar systems are also eligible for preferential tax policies and simplified administrative procedures, facilitating investment and operation.

4. Registration and operational management:

Connected rooftop solar systems must register and notify the competent authorities. Systems with a capacity of 1,000 kW or more must be equipped with supervision and control systems according to technical requirements publicly announced by Vietnam Electricity (EVN) to ensure grid safety and stability.

5. Excess electricity management:

The decree sets conditions and mechanisms for the purchase and sale of excess electricity from rooftop solar systems, with a maximum limit of 20% of installed capacity. The purchase price for excess electricity will be based on the average market electricity price of the previous year, encouraging development while aligning with market needs over time.

6. Responsibilities of local electric utilities and EVN:

Local electric utilities and EVN are responsible for supervising the development of rooftop solar power in their regions, ensuring power system safety, and handling payments for excess electricity sellers. EVN is also tasked with providing technical support and guidance to organizations and individuals on system installation and operation compliance.

Impact on the energy market

With Decree No. 135/2024/ND-CP, Vietnam’s renewable energy market is expected to see positive changes. Promoting investment in rooftop solar power will not only ease the load on the national grid but also create new business opportunities and raise environmental awareness in the community.

To read more about Decree No. 135/2024/ND-CP, customers and partners can quickly view the PDF document below:

Decree No. 135/2024/ND-CP

Vũ Phong Energy Group