Regulatory Developments for offshore wind power projects in Vietnam25 March 2025

Recent legal changes in Vietnam, including a revised power development plan and the introduction of new regulations, are aiming to resolve key challenges and kickstart the development of offshore wind power projects. This article further discusses the impact of these developments.

1. Revised Planning for Development of Offshore Wind Power in Vietnam

Promulgated nearly two years ago under Decision 500/QD-TTg dated 15 May 2023, the Vietnam National Power Development Master Plan for the period from 2021 to 2030 (“PDP8”) is now undergoing a revision process for a range of reasons, including increasing energy demand, sustainability goals, and the feasibility of achieving the completion targets of various projects. Regarding offshore wind, the proposed revisions include a: (i) timeline extension; (ii) reallocation of total capacity; and (iii) details of planned projects (i.e. location, capacity).

1.1 Extension of timeline

The recent draft of the revised PDP8 (“Draft Revised PDP8”), published on 26 February 2025, maintains the target for development of offshore wind at 6,000MW nationwide, but extends the expected completion period up to 2035 instead of 2030. This adjustment is because, following the issuance of PDP8, significant issues relating to offshore wind power projects, including offshore surveys, investment approvals and investor selection remained unaddressed (as discussed in our previous article). Only after the issuance of the new Electricity Law on 30 November 2024 (the “Law on Electricity 2024”) and Decree 58/2025/ND-CP on 3 March 2025 (“Decree 58”) was a regulatory framework established to resolve these long-standing concerns (see Section 2 below for details). Consequently, the extension of the timeline for offshore wind power projects under PDP8 aligns with the practical realities, ensuring adequate time for the execution of necessary procedures.

The timeline extension under the Draft Revised PDP8, however, was viewed as a negative impact on the promotion of offshore wind power development, especially considering the target of developing up to 139GW by 2050. Therefore, the Standing Committee of the Government issued Notification No. 93/TB-VPCP (“Notification 93”) on 10 March 2025, requiring offshore wind power projects to conform to the original deadline of 2030 as set out in the current PDP8. It is expected that subsequent drafts of the revised PDP8 will take into account the instructions under Notification 93. However, these raise concerns about the feasibility of achieving such targets of timeline.

1.2 Reallocation of capacity and planned projects

Draft Revised PDP8 reallocates the total capacity for development areas. The 500 MW to be developed in the Middle Central Area under PDP8 has been reallocated to the Southern Area under Draft Revised PDP8.

Draft Revised PDP8 also specifies the projects (or clusters of projects) within allocated areas, particularly:

2.Key Regulatory Developments for Offshore Wind Power in Vietnam

2.1 Updated definition of offshore wind power projects

The Law on Electricity 2024 provides an updated definition of a “wind power project at sea”, which are now classified as either a “nearshore wind power project” or an “offshore wind power project”. A “wind power project at sea” refers to a project in which all wind turbines are built in the territorial waters of Vietnam and located outside the lowest mean water line of the mainland for multiple years towards the sea (“lowest mean water line”).  A “nearshore wind power project” is one in which all turbines are built within the territorial waters of six nautical miles from the lowest mean water line (“six -nautical-mile territorial waters”), whilst an “offshore wind power project” is one in which all turbines are built in marine areas outside the six-nautical-mile territorial waters.¹

The updated definitions under the Law on Electricity 2024 clearly distinguish between nearshore wind power and offshore wind power projects, which align with the different technical characteristics of and legal regimes applicable to these projects.

2.2 Offshore wind survey

The Law on Electricity 2024 and Decree 58 have provided clear regulations on the conduct of offshore wind survey for implementation of offshore wind power projects.

Under the Law on Electricity 2024, offshore survey will be implemented either by (a) a 100% state-owned enterprise (“SOE”) assigned by the Prime Minister or (b) an entity selected in accordance with procedure promulgated by the Government.² Decree 58 specifies different requirements for entities selected to conduct offshore wind survey, including:³

• having clear, feasible and appropriate survey plan. The proposed capacity and marine area for survey must be included in the approved Power Development Plan or the implementation plan thereof;
• committing to use domestic human resources, goods and services to implement the survey plan, ensuring competitiveness in price, quality, progress and availability;
• committing to non-refund of survey costs in all circumstances;
• having sufficient financial capacity, or cooperating with an organisation with sufficient capacity to implement survey plans;
• having obtained approval from the Ministry of Defence, the Ministry of Foreign Affairs and the Ministry of Public Security; and
• committing to comply with all relevant regulations, including those regarding information security, environment protection and marine safety.

The new Ministry of Agriculture and Environmental (“MAE”) (successor of the Ministry of Natural Resources & Environment (i.e. MONRE) is assigned as authority to conduct the selection of surveying entities and allocation of marine areas. Decree 58 also sets out detailed requirements on survey contents, limit of survey areas, appraisal and reporting.

In terms of surveyed data, the surveying entity is required to submit the data to MAE and MOIT within 60 days from completion of survey activities for management. The surveying entity is allowed to use the data to develop their projects (either as a sole investor or in partnership with other entities). The surveying entity may also share or provide the data to entities participating in bidding for investor selection or entities appointed as investor of relevant projects, subject to approvals from all competent authorities.⁴

2.3 Conditions for foreign investors

Decree 58 addresses the previous uncertainty and clearly specified conditions for foreign participation in offshore wind power development in Vietnam, including:

• having experience developing at least one operational offshore wind power project in Vietnam or elsewhere;
• having financial capacity, with capital contributed accounting for at least 15% of the project’s estimated total investment capital and equity accounting for at least 20% of capital contributed;
• partnering with domestic enterprises, which must hold at least 5% of the charter capital or total voting shares in the economic organisation developing the project. The domestic enterprises eligible for cooperation include SOEs or enterprises majority owned by an SOE;
• having obtained consent from the Ministry of National Defence, the Ministry of Public Security, and the Ministry of Foreign Affairs; and
• committing to use human resources, goods, and services from domestic providers when investing, developing and operating a project based on the principle of ensuring competitiveness in price, quality, progress and availability.⁵

The transfer of projects and shares in offshore wind power projects to other entities was also addressed in Decree 58, with specific requirements covering approvals from relevant ministries, assurance of national security, right of first refusal of domestic enterprise(s) in partnership and conditions relating to the transferee.⁶

2.4 Project approval and investor selection

Following completion of an offshore wind survey, the surveying entities must prepare a dossier to propose approval of an offshore wind power projects. An SOE may prepare a proposal for both approval of a project and assignment of such project to the SOE, whilst other surveying entities may only propose the approval of a project.⁷ The proposal must contain all required content under the relevant regulations and is subject to approval of several authorities, including the relevant ministries and the provincial peoples’ committee.

Upon approval of the project, investors will be selected through either (a) direct assignment or (b) bidding. Direct assignment of investors shall apply either in case (a) a SOE concurrently proposes the approval of the project and direct assignment as investor of the project or (b) bidding cannot be applied due to national security or national defence reasons, as opined by the competent ministries. In case bidding is applied, the electricity generation tariff proposed by investor shall not exceed the annual maximum tariff as promulgated by the MOIT. In case the investor is selected, the proposed tariff will be the ceiling tariff in PPA negotiation.⁸

2.5 Development incentives

Decree 58 details development incentives specifically granted to offshore wind power projects obtaining investment approval before 1 January 2031 as follows:⁹

• exemption from the marine area use levy during construction, but only for up to three years from the commencement of construction. Reduction of 50% of marine area use levy for a period of 12 years from the expiry of the exemption period;
  exemption from the land use levy or land rent during construction, but only for up to three years from the commencement of construction. After the expiry of the exemption period, exemption and reduction will be applied in accordance with the laws on land and investment; and

• minimum long-term contracted electricity output of 80% during the loan repayments period, but not exceeding 15 years for projects selling electricity to the national power system. This incentive mechanism will not apply if the project fails to generate the committed minimum contracted electricity output due to (i) the project or (ii) the load demand or technical conditions of the power system cannot consume the entire output.

2.6 Tariffs and PPAs

The electricity tariff for offshore wind power projects supplying power to the national grid, the specific tariff will be negotiated following the method set out under Circular 12/2025/TT-BCT dated 1 February 2025 (“Circular 12”). the negotiated tariff will not exceed the maximum tariff annually approved by the MOIT in accordance with Circular No. 09/2025/TT-BCT dated 01 February 2025 (“Circular 09”).

For the PPA, before the promulgation of Circular 12, offshore wind power projects were required to use (i) the template PPA under Circular 07/2024/TT-BCT dated 12 April 2024 (“Circular 07”) when participating in the competitive merchant market or (ii) the template PPA under Circular 02/2019/TT-BCT dated 15 January 2019 (“Circular 02”) otherwise.

Contrary to Circular 07 and Circular 02, Circular 12 does not provide any template for the PPA. Instead, Circular 12 only outlines main contents of the PPA and allows the parties to supplement specific agreements, provided that such supplements comply with Vietnamese law. The mandatory PPA provisions under Circular 12 are limited to (i) rights and obligations of parties during restructuring of the power sector & transitional period of the competitive power market; (ii) transfer of rights and obligations of the seller; (iii) payment of fees, taxes and other incurred liabilities during performance of the PPA; (iv) governing law, contract language, number of copies; and (v) tariff calculation method.