Offshore Wind Worldwide Regulatory Framework in Selected Countries 5th Edition 2024 - Flipbook - Page 379
Offshore Wind Worldwide 2024
379
8. OTHER
Current regulations do not set out any other
special permitting/investment permit requirements for offshore wind projects. However, as of 26 March 2021 (i.e., the effective
date of Decree No. 31/2021/ND-CP issued
by the Government), offshore wind power
is now listed as a sector for which market
participation by foreign investors is “conditional” (this was not the case before 26
March 2021). Under the Law on Investment,
in general, market participation “conditions”
applicable to foreign investors comprise:
(i) ratio of ownership of charter capital of
foreign investors in the company; (ii) forms
of investment; (iii) scope of investment
operation; (iv) capacity of investors and
other parties participating in the investment
activity; and (v) other conditions under laws
and regulations of the National Assembly,
ordinances and resolutions of the Standing Committee of the National Assembly,
decrees of the Government and international treaties of which Vietnam is a member.
There is currently no foreign ownership
restriction in the offshore wind power sector
under Vietnamese laws and regulations, so
foreign investors may still own up to 100%
of the equity in offshore wind power project
companies. Offshore wind projects may be
developed by local and foreign electricity
generation companies based on the generally applicable Law on Investment, the regulations applicable for project licensing and a
PPA, which is based on a statutory template
attached to the wind regulations.
There are a few noteworthy bankability
challenges related to the largely non-negotiable template form of PPA on which EVN
has historically insisted. For example, the
PPA template does not expressly recognize
lender step-in rights. It should also be noted
that, for offshore projects, once an entity
is assigned a given marine space it cannot
transfer the right to use that marine space to
another entity. This may be problematic for
implementation of lender step-in rights.
The south-eastern region of Vietnam has
the highest wind speeds in the world and
a seabed which is relatively shallow and
consistent. This coastline is a high potential
zone for offshore wind energy. However,
there are many oil and gas platforms in
this area that could be a major obstacle to
the development of offshore wind power
projects.
Since the developers and sellers must bear
the costs and risks associated with the grid
connection, developing offshore wind energy further away from the coastline would
be even more demanding as more capital
investment is required for logistics and grid
connection.
Furthermore, there are currently no specific
regulations to mitigate project risks such as
damage to infrastructure (e.g., subsea transmission cables) and natural disasters.
