Scenario: an investor asks “what is the solar tariff now per kWh” and gets three answers: “FIT is over”, “bidding”, “sign a DPPA”. All three are partly right — Vietnam is transitioning renewable pricing mechanisms, and misunderstanding the mechanism means a financial model wrong from line one.
The FIT era has closed
Fixed preferential Feed-in Tariffs for solar and wind ended in 2020–2021, after sparking an investment boom. Operating FIT projects keep their issued pricing — but new projects get no FIT. Any “FIT price” math for new projects is wrong.
Current mechanisms: bidding, price negotiation
Post-FIT, Vietnam moved to investor-selection bidding / tariff negotiation as regulated — prices set by competition, not administrative fiat. Investors must track bidding rounds, official generation price frames, and prepare financing for below-old-FIT expectations.
DPPA: the new price channel for large customers
Decree 57/2025/ND-CP (effective 3 March 2025, replacing Decree 80/2024/ND-CP) establishes direct power purchase (DPPA) between renewable generators and large customers. DPPA enables direct price agreements with green-energy buyers (industrial zones, multinationals) — more flexible pricing than traditional EVN PPAs.
Financial modeling lesson: 3 price scenarios
Wise investors model 3 price scenarios: (1) actual bid/negotiated tariffs; (2) DPPA prices with large customers; (3) falling prices under fierce competition. Projects are viable only when all three break even — never let a project live on a single price.
Frequently asked questions
1. What are current solar/wind FIT rates?
No FIT for new projects — FIT ended in 2020–2021. New projects use bidding/negotiation or DPPA.
2. Are operating FIT projects affected?
No — operating FIT-recognized projects keep their issued pricing for the prescribed term.
3. What is the current renewable pricing mechanism?
Investor bidding / tariff negotiation as regulated; plus DPPA (Decree 57/2025, effective 3 March 2025) for large customers.
4. How does DPPA differ from traditional PPA?
DPPA is direct purchase between renewable generators and large customers with negotiable prices; traditional PPAs sell to EVN under model contracts.
5. What price assumptions belong in renewable financial models?
Three scenarios (bid/negotiated, DPPA, falling prices); viability requires break-even in all three.
This article has been quality-reviewed by the FLAW AI Legal Council.