Wind power developers race to complete projects for incentive price

Investors in wind power projects are racing to complete construction this month to enjoy an incentive feed-in tariff, but face procedural hurdles and those caused by Covid-19.

This month the developer of a plant in Quang Tri Province is rushing to complete construction and begin test runs, but is being slowed down by the various administrative procedures they have to go through.

The chairman of the investing company, who asked not be identified, said the plant needs to operate at least 70 percent of capacity, which means when the wind is weak this cannot be done.

“We made much effort but the test depends on the weather.”

To encourage renewable energy, Vietnam will give wind power projects that begin operation before Nov. 1 a feed-in tariff of 9.8 U.S. cents per kilowatt-hour to offshore projects and 8.5 U.S. cents for onshore ones. The tariff lasts 20 years.

But of the 106 wind power farms that have registered to provide 5,655.5 megawatts of power, there were only six that have received an operational permit by the end of last month.

Developers complain about the large number of permits they need to acquire to start the project, for example, the fire safety permit, and there are many unexpected challenges that lie ahead in getting these permits.

“We won’t be relaxed until the final permit is given, as from now until it is difficult to anticipate what will come up,” the chairman in Quang Tri said.

He proposed that the Department of Planning and Investment in the province increase the work hours of its employees, even at night, to support developers in acquiring permits. Several challenges contributed to a construction delay.

Some developers said that the fourth Covid-19 wave slowed their projects by two months, as experts were unable to enter the country, while the transportation of equipment faced blockages as authorities tightened social distancing.

Hoang Ngoc Quy, CEO of a developer HBRE, has been letting workers take three shifts to work 24 hours a day in the last three days.

He proposed that the government provides incentive policies, especially in loans, to support wind power farms.

The best support to extend the deadline until December next year for onshore projects and December 2025 for offshore projects.

Vu Chi Mai, head of component for renewable energy and energy efficiency at the German Agency for International Cooperation (GIZ), said that Covid-19 caused unexpected impacts on the projects, and therefore the deadline should be pushed back three to six months.

Ha Dang Son, deputy director of the Vietnam Low Emission Energy Program, said that the extended deadline should be given to certain projects depending how severe the Covid-19 impact was, not to all projects, as some have not even started.