Vietnamese Government’s Decree on Self-Consumption Rooftop Solar Power: A few comments (Part 2)

In light of our earlier analysis of Decree 135/2024, we have further observations regarding the Decree's lack of clarity. This post is written by Le Thanh Nhat.

Firstly, the Decree lacks a clear definition of “self-generation and self-consumption rooftop solar power” (Self-Consumption RSP). This is crucial as only surplus power from Self-Consumption RSP systems may be sold to EVN, Vietnam's national electricity provider. Unfortunately, Decree 135/2024 only offers the rather ambiguous definitions for “self-generation and self-consumption power” and “rooftop solar power” (which are arguably the two ‘components’ of Self-Consumption RSP) separately, without clarifying their integration.

Provisions of Decree 135/2024	Our comments
Self-generation and self-consumption power means power generated and consumed [performed] by an organisation or individual to serve mainly for the needs of said organisation or individual.	The grammatically incorrect use of the term “performed” herein by the drafter is, in our opinion, intended to mean that both the generation and consumption of Self-Consumption Power are “performed” by the same organisation or individual. With that being said, this definition failed to clarify who would be deemed as the one “performing” the generation of power: the owner or the operator of the power generator(s) (i.e., a rooftop solar power system).
Rooftop solar power means power generated from photovoltaic panels [under the principle of converting light into electricity], through construction structure [for the purpose of] installing on the roof of construction works, [connected] to electric equipment and directly serve the activities of power generation.	This seems like an indirect definition of a rooftop solar power system (i.e., a system of photovoltaic panels installed on the roof of construction works through construction structure, connected to electric equipment, and directly serves the activities of power generation). Regardless, Decree 135/2024 does not stipulate who would be the owner of said system.

Moreover, Decree 135/2024 introduces two types of Self-Consumption RSP: those connected to the national power system and those not connected. Both definitions focus on the system's connection status to the national power system but fail to address the “self-generation and self-consumption” aspect adequately:

Provisions of Decree 135/2024	Our comments
Self-Consumption RSP connected to national power system (Grid-Connected Self-Consumption RSP) means rooftop solar power for [generating] and providing power to the load at the location that is connected to the national power system or providing power to the load at the location that has a physical connection to the national power system.	As these two systems differentiate by whether they are connected to the national power system or not, the common wording of their definitions should supposedly be used to interpret Self-Consumption RSP. However, since their common wording is “rooftop solar power for generating and providing power to the load [at a certain location]”, it is evident that these definitions completely missed out on the “self-generation and self-consumption” part of the terms defined and are unhelpful in determining what Self-Consumption RSP is.
Self-Consumption RSP not connected to national power system (Off-Grid Self-Consumption RSP) means rooftop solar power for [generating] and providing power to the load at the location that is not connected to the national power system and providing power to the load at the location that has no physical connection to the national power system.

By combining the provided definition of “self-generation and self-consumption power” and “rooftop solar power” (which should be turned into the definition of a “rooftop solar power system” instead) one might deduce the following hypothetical definition of Self-Consumption RSP:

“Self-generation and self-consumption rooftop solar power means power generated by an organisation or individual from a [rooftop solar power system], and consumed by the same organisation or individual mainly for the needs of said organisation or individual.”

However, this hypothetical definition still inherits the Decree's ambiguities presented in the ‘component’ definitions as discussed above.

Another critical issue is the unclear applicable subjects of the registration requirements for Grid-Connected Self-Consumption RSP development. While Article 7.1 mandates notification or registration for developers of Grid-Connected Self-Consumption, Article 11 simply states that developers of Grid-Connected Self-Consumption RSP must prepare the dossier for registration of development of Grid-Connected Self-Consumption RSP. Their conflicting wording leads to different interpretations of the detailed provisions regarding notification and registration requirements. To be specific:

·       Articles 7.5 and 7.6 require notification for systems under 1,000 kW; and

·       Article 9.2 conditions the issuance of certification of development registration (giấy chứng nhận đăng ký phát triển in Vietnamese) on compliance with Article 9.3, which set out some requirements for systems of 1,000 kW or more.

Based on the wording of Article 7.1, one might infer that developers of Grid-Connected Self-Consumption would be subject to the notification requirements if their system is under 1,000 kW, and subject to the registration requirements if their system is 1,000kW or more.

Conversely, based on the wording of Article 11, one might infer that all developers of Grid-Connected Self-Consumption RSP are subject to the requirement of development registration regardless of their system’s capacity and they (i) must comply with the notification requirements under Articles 7.5 and 7.6 if their system are under 1,000kW; or (ii) must fulfil the requirements under Article 9.3, if their system are 1,000kW or more.

The Ministry of Industry and Trade’s Report no. 262/BC-BCT dated 14 October 2024 pertaining to the drafting of Decree 135/2024 (Report 262/2024) suggests that the former interpretation might be more in line with the intention of the drafter. With that being said, since the final version of Decree 135/2024 has different wording from those suggested under Part II.3 of Report 262/2024 (which is not legally effective), we are uncertain whether the intention of the drafter regarding development registration requirement still remains the same for the final and official draft of Decree 135/2024.