DECISION No. 63/2013/QĐ-TTg REGULATIONS ON SCHEDULE, CONDITIONS AND STRUCTURE OF ELECTRICITY SECTOR FOR FORMULATION AND DEVELOPMENT OF ELECTRICITY MARKET LEVELS IN VIETNAM

28 December, 2013

THE PRIME MINISTER

SOCIALIST REPUBLIC OF VIETNAM

Independence – Freedom – Happiness

—————

 No. 63/2013/QĐ-TTg

Hanoi, November 08, 2013

 

DECISION

REGULATIONS ON SCHEDULE, CONDITIONS AND STRUCTURE OF ELECTRICITY SECTOR FOR FORMULATION AND DEVELOPMENT OF ELECTRICITY MARKET LEVELS IN VIETNAM

Pursuant to the Law on Government organization dated December 25, 2001;

Pursuant to Law on Electricity dated December 03, 2004; the Law on amendments to a number of articles of Law on Electricity dated November 20, 2012;

At the request of the Minister of Industry and Trade;

The Prime Minister promulgates the Decision on schedule, conditions and structure of electricity sector for formulation and development of electricity market levels in Vietnam.

Chapter 1.

GENERAL PROVISIONS

Article 1. Governing scope

This Decision provides for schedule, conditions and structure of electricity sector for formulation and development of electricity market levels in Vietnam.

Article 2. Regulated entities

This Decision applies to entities participating in electricity market.

Article 3. Interpretation of terms

In this Decision, some terms are construed as follows:

Article 4. Schedule for formulation and development of electricity market levels in Vietnam

Electricity market is formed and developed through three levels as follows:

a) From 2015 – 2016: Pilot competitive wholesale electricity markets;

b) From 2017 – 2021: Put into operation complete competitive wholesale electricity markets;

a) From 2021 – 2023: Pilot competitive retail electricity markets;

b) From after 2023: Put into operation complete competitive retail electricity markets;

Article 5. General principles of electricity market

Electricity market operates in following principles:

Chapter 2.

COMPETITIVE ELECTRICITY MARKETS

Article 6. Principles of electricity market

Apart from principles as prescribed in Article 5 hereof, competitive electricity market shall operate in following principles:

Chapter 3.

COMPETITIVE WHOLESALE ELECTRICITY MARKETS

Article 7. Principles of competitive wholesale electricity markets

a) Power corporations, power companies, electricity retailers and major end-users that meet requirements as prescribed shall be eligible for purchasing electricity from generating units, electricity wholesalers via a bilateral agreement in sport electricity market.

Apart from rights and obligations of electricity distributors and retailers, the power corporations and power companies shall perform rights and obligations of electricity wholesalers.

a) Newly established electricity wholesalers that meet requirements as prescribed shall be eligible for purchasing electricity from generating units, electricity wholesalers via a bilateral agreement in sport electricity market for selling to other electricity wholesalers, electricity retailers and major end-users.

c) Newly established electricity wholesalers that meet requirements as prescribed shall be eligible for purchasing electricity from generating units, electricity wholesalers via a bilateral agreement in sport electricity market for selling to other electricity wholesalers, electricity retailers and major end-users.

d) During pilot operation of wholesale electricity markets, a number of power corporations, power companies affiliated to Vietnam Electricity and a number of electricity retailers, major end-users shall be selected to participate in the pilot competitive wholesale electricity markets.

Article 8. Structure of electricity sector for formation and development of competitive wholesale electricity markets

To form a competitive wholesale electricity market, the structure of electricity sector should meet following requirements:

a) National electricity system regulatory units, electricity market transaction management units are independent units that do not share common interests with entities involved in electricity market;

b) Power corporations, power companies affiliated to Vietnam Electricity (except for large power plants playing important roles in socio-economic development, national defense and security under exclusive management of the State as prescribed in Article 4 of Law on Electricity) should be split into independent generating units sharing no common interests with electricity wholesalers, transmission network operators, national electricity system regulatory units and electricity market transaction management units;

c) Total installed capacity of a generating unit should not exceed 25% of total installed capacity of generating units involved in electricity market;

d) Power corporations, power companies that meet requirements as prescribed, are eligible for participation in the pilot competitive wholesale electricity markets should clearly define the organizing and accounting apparatus of electricity distribution and retailing departments.

Power companies affiliated to power corporations shall be organized as independent accounting units; these units should clearly define the organizing and accounting apparatus of electricity distribution and retailing departments.

Article 9. Conditions for formation and development of competitive wholesale electricity markets

a) Project on re-structuring of electricity sector approved by the Prime Minister;

b) Design for competitive wholesale electricity market approved by the Ministry of Industry and Trade;

c) The Ministry of Industry and Trade shall promulgate or make amendments and supplements to following regulations:

– Regulations on conditions for participation in wholesale electricity markets; regulations on operation of competitive wholesale electricity markets;

– Regulations on electricity regulatory activities, electricity transmission system, distributed electricity system, electrical energy measurement and electricity pricing in accordance with activities of competitive wholesale electricity markets;

– Regulations on prices for electricity transmission, distribution, electricity system regulation and electricity market transaction management;

– Other necessary conditions;

a) Complete SCADA/EMS, remote measurement system connected to electricity distribution units as independent accounting units, major end-users meeting requirements of competitive wholesale electricity markets;

b) Equip communications system serving electricity market operation management meeting requirements of competitive wholesale electricity markets;

Chapter 4.

COMPETITIVE RETAIL ELECTRICITY MARKETS

Article 10. Principles of competitive retail electricity market

a) Electricity retailers shall purchase electricity from generating units, electricity wholesalers via a bilateral agreement in sport electricity market to re-sell to end-users;

b) Newly established electricity retailers that meet requirements as prescribed shall be eligible for purchasing electricity from generating units, electricity wholesalers to re-sell to end-users.

c) End-users that meet requirements as prescribed shall be eligible for purchasing electricity from generating units, electricity wholesalers, electricity retailers via a bilateral agreement in sport electricity market.

Article 11. Structure of electricity sector for formation of competitive retail electricity markets

To form a competitive wholesale electricity market, the structure of electricity sector should meet following requirements:

Article 12. Conditions for formation of competitive retail electricity markets

a) The Prime Minister shall grant approval for the project on re-structuring of electricity sector (except in case of need);

b) Design for competitive retail electricity market approved by the Ministry of Industry and Trade;

c) The Ministry of Industry and Trade shall make amendments and supplements to the regulations applicable to competitive retail electricity markets;

– Regulations on conditions for participation in competitive retail electricity markets; regulations on operation of competitive retail electricity markets;

– Regulations on electricity regulatory activities, electricity transmission system, distributed electricity system, electrical energy measurement and electricity pricing in accordance with competitive retail electricity markets;

– Regulations on prices for electricity transmission and distribution, electricity system regulation and electricity market transaction management;

– Other necessary conditions;

a) Complete SCADA/DMS, remote measurement system for distribution grids meeting requirements of competitive retail electricity markets;

b) Equip communications system serving electricity market operation management meeting requirements of competitive retail electricity markets;

Chapter 5.

IMPLEMENTATION

Article 13. Implementation

a) Establish the Project on re-structuring of electricity sector in accordance with schedule of development of electricity market levels and make the submission to the Prime Minister for approval;

b) Direct establishment and development of electricity market in Vietnam according to the schedule prescribed hereof; carry out supervision and assessment of the establishment and development of electricity market;

c) Grant approval for the design on electricity market levels;

d) Promulgate regulations on electricity market operation and other relevant regulations;

dd) Keep receiving aids from international donors for the establishment and development of electricity market levels;

e) Compile and report demands for budget for the development of electricity market under annual plan to the Ministry of Planning and Investment for submission to the Prime Minister;

a) Complete investment in technical infrastructure required for activities of competitive electricity markets and competitive wholesale electricity markets;

b) Organize training in professional competence for carders, staff from affiliates of Vietnam Electricity;

c) Invest in technical infrastructure and provide financial supports for the establishment of new independent units;

a) Invest in necessary technical facilities that meet requirements of electricity market levels;

b) Organize training in professional competence for carders, staff;

Article 14. Effect

This Decision takes effect since December 25, 2013; the Prime Minister’s Decision No. 26/2006/QĐ-TTg dated January 26, 2006 granting approval for schedule, conditions for formation and development of electricity market levels in Vietnam shall become invalid since the effective date of this Decision.

Article 15. Responsibility

 

  THE PRIME MINISTER Nguyen Tan Dung

 

 

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