Date: 19 July 2021
Writer: Linh Nguyen
Nowadays, the rooftop solar power system project is attracting a lot of attention from domestic and foreign investors. With the aim to legally operate in Vietnam, rooftop solar power projects must be done with the requirements of Vietnam’s prevailing regulations on required licenses as well as authorities’ guidelines.
Through this article, BLawyers Vietnam would like to share with you the necessary licenses to proceed with this project.
I. Models and requirements for rooftop solar power projects
A rooftop solar power system (“RSPS”) refers solar power system in which solar panels are installable on the roof of the construction. Such RSPS must be less than 1 MW in power, directly or indirectly connecting to the up-to-35kV power grid of the power purchaser. RSPS must be on the rooftop of construction with independent utilities. Furthermore, such solar panels must have an efficiency of more than 16% and the module’s efficiency must be higher than 15%.
RSPS is permitted to sell a part or all of the electricity produced to the Buyer, which could be Vietnam Electricity (“EVN”) or other organizations or individuals. Currently, RSPS is formed in two models in Vietnam:
- Rooftop owners invest in the construction and installation of solar power systems on their own roofs to use for themselves and sell part of non-used electricity to EVN;
- Enterprise rents the roof to install the EIA system, then sell electricity to the rooftop’s owner and/or EVN.
II. Required licenses for rooftop solar power projects
Before performing the RSPS, investors must be certificated by 03 main licenses, including:
- Enterprise Registration Certificate (“ERC”);
- Construction Permit (“CP”); and
- Fire Prevention and Fighting System Certificate (“FPFSC”).
1. Enterprise Registration Certificate
Enterprises that want to implement the RSPS projects must have appropriate business lines. Before conducting the project, the enterprise must register or supplement the solar power production industry and/ or the power distribution transmission industry. Provincial Departments of Planning and Investment shall be competent to consider such registration.
With respect to foreign investors, they must obtain the Investment Registration Certificate (“IRC”) before registering enterprise establishment. The IRC should also record the enterprise’s object in the implementation of RSPS projects.
Furthermore, Vietnamese enterprises may transfer PRPS projects to foreign investors through joint ventures or share transfers. Depending on the scale of the project, the Department or the Ministry of Planning and Investment will handle the project transfer settlement.
2. Construction Permit
By law, RSPS is considerable as a construction building under the prevailing Law on Construction. Thus, the RSPS project’s investors must obtain the CP before proceeding with the installation, except for some construction projects that are exempt from CP. Investors should cross-check with the Provincial or District Department of Construction to determine whether such project requires CP.
Depending on the situation of construction works when installing RSPS, investors must obtain the following corresponding licenses:
- New Construction Permit: issueable for new projects, constructions, or projects, constructions that have not been commended but whose CP extension period has expired.
- Renewable permit: if there is a CP available for the building (where installing the RSPS system) but when installing the RSPS, changes are made to the original construction structure of the building.
After obtaining all compulsory permits, the project owner must send notice prior to at least 03 working days in advance of the starting date of the construction, including the case of CP exemption.
3. Fire Prevention and Fighting System Certificate
RSPS falls into an investing construction project that must be approved for fire protection designs. Therefore, FPFSC is a compulsory license to operate the RSPS project as prescribed by law. Police Department of Fire Prevention and Fighting is the agency to issue the FPFSC.
Although an investor implement RSPS project in an existing building that satisfies fire protection conditions, it is still necessary for a certification meeting satisfaction.
If changing design of an existing building, the investor/ owner must submit a dossier for obtaning the FPFSC. It is also the same for case of no approval on design for the system installation at the new building.
In addition to the aforesaid three licenses, investors of RSPS must use the form of Purchase and Sell Power contracts prescribed by the Ministry of Industry and Trade.
Good read: Some guidelines on rooftop solar power from Vietnam’s Ministry of Industry and Trade
In conclusion, RSPS must have the above-mentioned licenses in practice. Investors should check for specific cases to ensure that the project complies with the laws.
Should you have any questions about the above contents, please revert to BLawyers Vietnam at consult@blawyersvn.com. We are more than happy to hear from you!
Maybe you want to read:
Template of power purchase agreement for roof solar power system pursuant to Vietnamese laws
New points of Law on amending and supplementing to Law on Construction of Vietnam
