Much remains to be done to effectively implement the direct electricity trading mechanism.

The effective implementation of the DPPA mechanism will open up many opportunities for the Vietnamese energy industry to simultaneously achieve many major goals, namely: meeting the trend of using clean energy of electricity customers, contributing to attracting investment in developing renewable energy and promoting the implementation of a competitive retail electricity market. Although it will take effect immediately upon promulgation (from July 3, 2024), there is still much to be done to effectively implement the DPPA mechanism.

According to Decree 80/ND-CP of the Government , the DPPA mechanism stipulates two forms of direct participation in electricity trading, including through "Private Connection Line" and through "National Grid".

For direct electricity trading - via private connection lines, it is the activity of signing a contract for electricity trading and delivery via private connection lines between a renewable energy generator and a large electricity user.

The Government issued Decree No. 80/2024/ND-CP regulating the mechanism for direct electricity purchase and sale between renewable energy generators and large electricity users.

For direct electricity trading - through the national grid, it is the trading of electricity through a forward contract between a renewable energy power generation unit and a large electricity user (or an electricity retailer in an authorized cluster or zone model) and the trading of electricity is carried out in accordance with the provisions of this Decree, including: (1) A renewable energy power generation unit sells all the electricity produced to the spot electricity market of the competitive wholesale electricity market; (2) A large electricity user, or an electricity retailer in an authorized cluster or zone model, signs a power trading contract with the electricity corporation (or an authorized/decentralized unit) to purchase all the electricity to meet the demand; (3) A renewable energy power generation unit and a large electricity user, or an electricity retailer in an authorized cluster or zone model, buys and sells electricity through a forward contract.

Regarding questions related to signing/enforcing and breaking contracts under the DPPA mechanism, according to Mr. Pham Quang Huy - Deputy Director of the Electricity Regulatory Authority, Ministry of Industry and Trade , for direct electricity trading - via private connection lines, it is a civil contract relationship, the electricity price is agreed upon between the buyer and the seller, the Ministry of Industry and Trade does not intervene in the electricity price, so breaking the contract is also under the civil jurisdiction between the parties.

Regarding the direct purchase and sale of electricity - through the national grid, Mr. Pham Quang Huy said: "For purchasing electricity through the national grid, this is a relatively mutual relationship, and when we sell electricity into the system through the spot market price, and buy it out at the spot value, and sign a CB-type difference contract.

When one of these three contracts is terminated, it will also affect the relationship as well as the mutual support in this purchase and sale. Therefore, when studying the principles of electricity purchase and sale, we believe that electricity purchase and sale through the electricity market is a form that almost never has a suspension or termination - if there are no major impacts (regulated in Circular 45 of the Ministry of Industry and Trade), which are force majeure cases occurring in the electricity market as well as forms of attack from the outside.

Illustration photo.

According to Decree 80/ND-CP, customers using 200,000 kWh of electricity per month will be allowed to participate in the direct power purchase mechanism (DPPA). Thus, the whole country will have more than 7,700 large electricity customers allowed to participate in this mechanism. Statistics from the Ministry of Industry and Trade show that the commercial electricity output of more than 7,700 large customers currently accounts for about 39% of the total electricity output of the system. This will create considerable pressure on Vietnam Electricity Group (EVN) when it loses large customers as well as has to readjust all methods of buying and selling electricity.

However, from the perspective of electricity producers and distributors, Mr. Vo Quang Lam - Deputy General Director of Vietnam Electricity Group (EVN) affirmed that the DPPA mechanism is an important step to promote a competitive retail electricity market as well as bring long-term benefits to all parties. At the same time, EVN has been actively doing its part to be able to immediately implement this Decree.

“In this Decree, there are two mechanisms directly related to the Group. The first is the mechanism for selling electricity to the national grid. For this field, during the process of the Ministry of Industry and Trade drafting the Decree, the Group has organized a review of internal management processes, and especially this July we will complete the review of internal management processes so that it is consistent with the provisions of the Decree as well as related laws, so that within the Group as well as its member units, the Power Corporations, and the electricity trading companies will be able to implement it immediately.

In addition, regarding the Group's responsibility related to coordinating with the Ministry of Industry and Trade to develop transmission prices, distribution prices, service fees and mechanisms related to the Law on Prices as well as the provisions in this Decree, Vietnam Electricity Group will continue to coordinate with the Electricity Regulatory Authority to soon promulgate them, so that the mechanisms related to the national power system can be put into operation immediately" - Mr. Vo Quang Lam said.

At the conference to implement Decree No. 80/2024/ND-CP of the Government, Minister of Industry and Trade Nguyen Hong Dien requested: “The Electricity Regulatory Authority and the Legal Department shall preside over and coordinate with relevant units under the Ministry of Industry and Trade to review, propose amendments, supplements or issue new guiding circulars under the responsibility of the Ministry of Industry and Trade; At the same time, advise and recommend relevant ministries and branches to amend, supplement and issue new guiding circulars (if necessary) to ensure that the implementation of the direct electricity purchase and sale mechanism has no major problems or obstacles.

Urgently research and propose a pilot mechanism for two-component electricity prices - capacity price and electricity price, and submit it to competent authorities for promulgation in August 2024. At the same time, research and propose a mechanism to separate transmission prices and fees from electricity costs, which must also be completed before September 2024, because these are two mechanisms that are very closely related to the DPPA mechanism, with the rooftop solar power development mechanism that we will soon promulgate.

According to organizations and businesses, in the immediate future, the Ministry of Industry and Trade needs to soon organize training courses and provide guidance for businesses in the electricity sector and local Departments of Industry and Trade to ensure the implementation of the direct power purchase mechanism (DPPA) in a synchronous, unified and accurate manner according to the provisions of the Decree.

According to VOV

Source: https://baolaocai.vn/con-nhieu-viec-phai-lam-de-thuc-thi-hieu-qua-co-che-mua-ban-dien-truc-tiep-post386582.html