Rooftop solar power self-produced regulations in Vietnam

With the goal of pursuing renewable energy and decreasing the impact on the environment, on 22/10/2024, Decree 135/2024/ND-CP stipulated mechanisms and policies to encourage the development of rooftop solar power for self-production and self-consumption promulgated and forced by the government within the same day. One of the most noticeable contents of this Decree is the registration of self-production and self-consumption rooftop solar power development in households today. Viet An Law will update information on the rooftop solar power self-produced regulations in Vietnam according to Decree 135/2024/ND-CP.

Policies encouraging the development of rooftop solar power self-produced in Vietnam

Rooftop solar power is electricity produced from photovoltaic panels according to the principle of transforming from photovoltaic energy to electricity, through a construction structure to install on the roof of a construction work, connect to electrical equipment, and directly serve power generation activities. Self-produced and self-consumed electricity is electricity produced and consumed by an organization or individual to serve the main needs of such organization or individual.

In Article 8 of the newly issued Decree 135/2024/ND-CP, Vietnam is implementing policies to encourage the development of rooftop solar power self-produced energy as follows:

Exemption from electricity activity license

Organizations and individuals that install rooftop solar power for self-production and self-consumption are exempt from electricity activity licenses and have no capacity limit in the following cases:

• Do not connect to the national power system;
• Installing a system of anti-reverse equipment in the national power system
• Households and individual houses developing rooftop solar power for self-production and self-consumption with a capacity of less than 100 kW.

Tax incentives

Under the rooftop solar power self-produced regulations in Vietnam, enterprises engaged in the self-production and self-consumption of rooftop solar power are eligible for preferential policies concerning corporate income tax and value-added tax (VAT) when undertaking new investment projects, in compliance with the prevailing tax laws.

Administrative procedures support and simplification

• Self-produced and self-consumed rooftop solar power’s administrative procedures are simplified by current specialized laws.
• Construction works with rooftop solar power installed for self-production and self-consumption are not required to adjust and supplement the planning on land, energy, and function in accordance with the provisions of law.
• Households and detached houses developing rooftop solar power for self-production and self-consumption are exempt from or not required to adjust their business licenses.

Obligation to notify when developing rooftop solar power for self-production and self-consumption

Self-produced and self-consumed rooftop solar power is not connected to the national electricity system

Under the rooftop solar power self-produced regulations in Vietnam, self-produced and self-consumed rooftop solar power not connected to the national power system refers to solar power that generates and supplies electricity exclusively to on-site loads without integration into the national grid. According to Article 6 of Decree No. 135/2024/ND-CP, entities intending to install such systems must fulfill specific obligations prior to installation:

• Inform the installed capacity and implementation location of the Department of Industry and Trade and the local electricity unit.
• Notify the local construction and fire prevention management agency to manage, monitor, and guide implementation according to the provisions of the law.

Self-produced and self-consumed rooftop solar power connected to the national electricity system

According to Article 7 of Decree No. 135/2024/ND-CP, organizations, individuals, households, and standalone residential houses that develop rooftop solar power for self-production and self-consumption with an installed capacity of less than 100 kW must:

• Notify the Department of Industry and Trade and the local power utility unit;
• Notify the local authorities responsible for construction and fire prevention for management, monitoring, and guidance by legal regulations.

Before installing rooftop solar power for self-production and self-consumption with an installed capacity ranging from 100 kW to less than 1,000 kW, organizations and individuals must:

• Submit a notification along with design documents to the Department of Industry and Trade;
• Notify the local authorities responsible for construction and fire prevention for management, monitoring, and guidance in accordance with legal regulations;
• Notify the local power utility unit for the management, monitoring, and safe operational control of the power system.

Template for notification of the development of rooftop solar power for self-production and self-consumption connected to the national power grid

Currently, in cases where rooftop solar power for self-production and self-consumption is connected to the national power grid, the notification should be made using Form No. 04 of the Annex issued together with Decree No. 135/2024/ND-CP.

Obligation to register for the development of rooftop solar power for self-production and self-consumption

Registration Requirements

According to Clause 2, Article 8 of Decree No. 135/2024/ND-CP, the regulations are as follows:

“Article 8. Incentive Policies

2. Organizations and individuals installing rooftop solar power for self-production and self-consumption with an installed capacity of 1,000 kW or more and selling surplus electricity to the national grid must comply with power planning procedures (except for cases where the capacity scale is allocated under the local planning and implementation plans) and apply for a power operation license following the law.”

Therefore, in cases where rooftop solar power for self-production and self-consumption is connected to the national grid with a capacity of 1,000 kW or more and sells surplus electricity to the national grid, registration for a development registration certificate is required.

Development Registration Dossier for Rooftop Solar Power for Self-Production and Self-Consumption

The dossier for the development registration of rooftop solar power for self-production and self-consumption must comply with Clause 2, Article 10 of Decree No. 135/2024/ND-CP, including:

• Registration form: According to Form No. 01 in the Annex issued together with Decree No. 135/2024/ND-CP;
• For households and standalone residential houses: Provide installation design drawings for rooftop solar power for self-production and self-consumption; a copy of the construction permit (if any) in accordance with the law;
• For other entities: Provide installation design drawings for rooftop solar power for self-production and self-consumption; copies of investment policy, construction permit, fire prevention and firefighting acceptance, construction work acceptance results, and environmental protection documents issued by competent authorities (if any) in accordance with the law.

Processing Procedure for Registration Dossier

• Submit the dossier to the Provincial Department of Industry and Trade, which is the competent authority to receive and issue the development registration certificate.
• If the dossier is complete and valid, within 10 days from the date of receipt, the receiving authority is responsible for issuing the development registration certificate. If the requirements are not met, the receiving authority will issue a written notice stating the reasons.
• After receiving a valid registration dossier, the receiving authority will send the dossier to the local power utility unit to obtain opinions on whether the proposed rooftop solar power for self-production and self-consumption will cause overloading of substations, low voltage, and distribution grids in the registered development area, and whether the proposed capacity is compatible with the existing load (based on electricity consumption in the last 12 months). The power utility unit must review, resolve, and provide feedback to the receiving authority within a maximum period of 7 days.

Note on regulations on selling surplus electricity

Surplus electricity is the electricity produced by the rooftop solar power system for self-production and self-consumption that is not fully used for the load and is fed into the national power grid.

Activities related to selling surplus electricity must adhere to certain regulations in Decree No. 135/2024/ND-CP as follows:

Selling Surplus Electricity

Under the rooftop solar power self-produced regulations in Vietnam, organizations and individuals may opt to either feed or not feed surplus electricity, if any, from their self-produced and self-consumed rooftop solar power systems into the national grid. Households and standalone residential houses with such systems, with an installed capacity of less than 100 kW, may sell surplus electricity to the national grid, provided they meet the following conditions:

• There is a connection to the national power grid;
• The capacity is consistent with the development capacity in local planning and implementation plans;
• Notification has been made according to regulations;
• Vietnam Electricity (EVN) will pay organizations and individuals for the surplus electricity fed into the national power grid, but not exceeding 20% of the actual installed capacity;

The purchase price of surplus electricity fed into the national power grid is equivalent to the average market electricity price of the previous year announced by the system operator and electricity market to ensure appropriate incentives in each development period of the national power grid.

Note: Rooftop solar power for self-production and self-consumption installed on the roofs of public office buildings or structures identified as public assets will not participate in the sale of surplus electricity.

Not Selling Surplus Electricity

In cases where surplus electricity is not sold to the national power grid, registration must be made according to Point b, Clause 1, Article 8 of Decree No. 135/2024/ND-CP. Accordingly, organizations/individuals producing and consuming their electricity are obliged to install anti-reverse power systems if connected to the national power grid.

Note on the implementation of surplus electricity sales for self-produced, self-consumed rooftop solar power.

The buyer and seller of surplus electricity shall sign a power purchase agreement according to Form No. 05 in the Annex issued together with Decree No. 135/2024/ND-CP. The term of the power purchase agreement is 5 years from the date the self-produced, self-consumed rooftop solar power system is put into operation.

The procedure for buying and selling electricity for rooftop solar power for self-production and self-consumption with surplus electricity is specified in Article 18 of Decree No. 135/2024/ND-CP, including the following steps:

• Organizations and individuals submit a dossier requesting to sell electricity from the self-produced, self-consumed rooftop solar power system, including a written request for selling electricity, technical documents on solar panels, DC to AC power converter; power transmission line; copies of the factory certificate, quality certification (authenticated copies); development registration certificate or written confirmation from the Department of Industry and Trade that the capacity falls within the locally allocated planning and implementation plans; construction completion dossier according to construction law.
• The parties conduct technical inspections, install electricity meters, and finalize meter readings.
• Sign the power purchase agreement and energize the system, putting the self-produced, self-consumed rooftop solar power system into operation; the buyer of surplus electricity must sign the contract within 5 working days from the date of receiving the seller’s written request and dossier for selling electricity.

Above are some notable contents regarding the notification and registration procedures for the development of self-produced rooftop solar power systems according to Decree No. 135/2024/ND-CP. If you have any related questions, please contact Viet An Law for the best advice and support!