Vietnam Refines The Framework For Direct Power Purchase Agreement With Decree 57/2025
Following the issuance of the Law on Electricity 2024, Vietnam's Government has swiftly replaced its initial framework for Direct Power Purchase Agreements (DPPAs) under Decree 80/2024 by issuing Decree 57/2025 on 3 March 2025. Coming into effect immediately, Decree 57/2025 repeals Decree 80/2024, which had only been active since 3 July 2024. Decree 57/2025 largely maintains the two DPPA models introduced by Decree 80/2024 (1) via private line (Private DPPA) and (2) via the national grid (Grid-Connected DPPA), but introduces important changes impacting eligibility, pricing, and contractual details. Key changes include:
Flexible customer eligibility - Decree 57/2025 links customer eligibility (for initial participation and ongoing qualification) to a minimum consumption threshold (Minimum Take Amount) defined in the Wholesale Electricity Market Operation Regulations issued by the Ministry of Industry and Trade (MOIT). Decree 80/2024 instead used a fixed threshold (average ≥200,000 kWh/month). Accordingly, eligibility for participating in either DPPA model now depends on potentially dynamic wholesale market rules rather than a static figure, requiring ongoing monitoring of MOIT's regulations.
Stricter customer eligibility – A Large Customer in a DPPA arrangement which has been implemented for 12 months must ensure that in a calendar year, it has purchased from EVN the Minimum Take Amount for the 12 month periods ending on 31 October of the previous calendar year. Under Decree 80/2024, there is no requirement that the Minimum Take Amount must be purchased from EVN. It is not clear if this requirement will apply to a Private DPPA under which the customer purchases directly from the RE Generator.