The “Fear” of Wind Power Investors in Bidding mechanism – Overall investigation is required.

Vietnam is a country with very high potential for wind power. Photo: Xuan Ngoc

LDO - The bidding mechanism makes many people worry about the fate of wind power investors, especially offshore wind power when many projects may not be on schedule to reach the "COD’s date" before October 31, 2021 to enjoy the benefits of Fit in Tariff price (FIT price). After this deadline, the price mechanism will bechanged.

The Difficulties of Bidding mechanism to Investors.


Talking to Lao Dong, Mr. Ian Hatton - Chairman of Enterprize Energy Group, the investor of the Thang Long offshore wind power project - said that wind power is not limited to generating electricity and connecting to the national electricity grid, but also integrated with the water electrolysis system, independent of the grid, generating hydrogen fuelto replacing fossil fuels, serving electricity generation from gas turbine plants, transportation, chemicals, energy storage.


Vietnam's offshore wind potential allows Vietnam to synchronously develop the above mentioned goals, not only serving the country but also exporting green hydrogen fuel.

"We have proposed this content to the Government and the Ministry of Industry and Trade. That is also the reason that the World Bank Group and the Vietnam Energy Association proposed to increase the offshore wind power capacity of Vietnam by 2030 is 10 GW to 20GW compared to the current draft Power Plan VIII," Ian Hatton said


To be asked if the upcoming bidding mechanism will make it difficult for wind power projects that cannot COD before the deadline of November 1st, 2021, Mr. Ian Hatton said that the bidding for offshore wind power projects has been widely popularized by countries in Asia and around the world, on that basis, the World Bank Group has synthesized and proposed specific recommendations.


"We have proposed to the Government and the Ministry of Industry and Trade to allow the application of the price negotiation mechanism of the power purchase agreement of the Thang Long Wind project according to the principles of publicity, transparency, in accordance with international practice and must be gradually reduced due to the development of technology and supply chain "- Mr. Ian Hatton shared.


Overall investigation is required.


Talking with Labor, Dr. Dinh Van Nguyen - Head of the National Offshore Renewable Energy Development Project, National Center for Energy, Climate and Sea (MaREI Center), University of Cork, Republic of Ireland - said, to develop a wind power project, including projects onshore, near-shore and offshore wind power - formed based on a large enough supply chain, with special high technical requirements on human resources, equipment, ships, machinery and construction technology and need investors, contractors with experience, financial capacity.


In the Forth-coming time, if the authorities decide to remove the FIT mechanism for wind power, it is necessary to have an overall investigation to see how domestic wind power enterprises have human, material and financial resources. How is the probability of winning the bid?


In addition, in order to avoid possible consequences such as solar power in the past time, the authorities need to answer the questions: How many kWh/year can the wind power contractor's capacity meet and whether how many kWh/year to bid; How to bid for businesses to prepare human resources.


“I think that with onshore wind power, now investors and construction enterprises are basically autonomous and have financial potential, so they should implement the mechanism of bidding and selecting investors.

However, if bidding is carried out, it is necessary to achieve the most important goal, which is to optimize the efficiency of the bidding price and the final electricity purchase price. How to make the bidding and investor selection have a specific roadmap and take place continuously for 5 years" - Dr. Dinh Van Nguyen said.


As for offshore wind power, according to this expert, the switch to the bidding mechanism should be carefully considered.

Because, unlike onshore wind power, the offshore wind power industry's investment is very complicated, requiring cooperation between project developers and the government, creating a local supply chain. The pricing mechanism associated with phased investment, moving from FIT to bidding, will help stakeholders have more time to learn and gain experience

Translated from Lao Dong Online