DPPAs in Vietnam: How Buyers Can Now Purchase Solar Directly

What a DPPA Is

A Direct Power Purchase Agreement is a contract between a renewable energy generator (the solar developer or project owner) and a large electricity consumer (an industrial buyer, a manufacturing company, an industrial park). Under the agreement, the generator produces electricity from a solar farm and supplies it to the buyer at a pre agreed price over a fixed contract term, typically 10 to 20 years.

Decree 57 defines two DPPA models. Model 1 is the private wire model: the generator sells power to the buyer through a direct, private transmission line with no EVN network involved. Model 2 is the national grid model: the generator's electricity flows through EVN's transmission and distribution network to reach the buyer, with EVN charging a wheeling or transmission fee for network use, but EVN is not the seller and does not set the electricity price. Most industrial park and large-buyer DPPAs in practice use Model 2, since building dedicated private wire infrastructure is capital-intensive.

DPPAs were not possible in Vietnam before Decree 57, because all electricity sales to consumers were required to go through EVN as the single buyer. The new decree breaks this monopoly arrangement for qualifying large consumers and renewable energy generators.

Who Qualifies for a DPPA in Vietnam

Under Decree 57, DPPA eligibility has specific conditions:

• The buyer must be a large electricity consumer: average monthly consumption of at least 200,000 kWh over the last 12 months, or a registered consumption commitment of at least 200,000 kWh for buyers with under 12 months of consumption history. This is a real loosening from the original 2024 framework, which required exactly 200,000 kWh and a minimum 22 kV connection, criteria that excluded many otherwise-qualified buyers.
• The generator must be a renewable energy facility, solar, wind, or biomass. Biomass was added as an eligible source under Decree 57, expanding on the original 2024 framework which covered only wind and solar. Fossil fuel generators cannot participate in DPPAs.
• The contract must meet minimum term requirements and include specific provisions for payment, curtailment, and grid operations defined by MOIT and EVN regulations.
• Approval from the relevant regulatory authority is required before the DPPA takes effect. This is not an automatic process — applications go through a review.

Why Industrial Buyers in Vietnam Want DPPAs

The same three drivers that push nearshored factories in Mexico toward solar apply in Vietnam: electricity cost, corporate sustainability targets, and supply reliability. Vietnam's industrial electricity tariffs have increased over recent years and the long term direction is upward. More importantly, large multinational manufacturers operating in Vietnam — electronics companies, textile exporters, furniture manufacturers serving European and North American brands — have parent company commitments to renewable electricity under RE100 or Science Based Targets initiative frameworks.

A Vietnamese subsidiary of a multinational that needs to demonstrate 100% renewable electricity for its parent company's sustainability report cannot do this through rooftop solar alone if its facility is large. A DPPA with a solar farm provides a documented, contractual source of renewable electricity that satisfies corporate RE reporting requirements. RECS International notes that Vietnam's RE100 committed companies have been actively seeking DPPA opportunities since the framework was first announced.

How EPCs Can Enter the DPPA Market

The DPPA market is not for the typical residential or small commercial EPC. Projects are typically 5 MW and above. Contract negotiations are complex and involve legal counsel on both sides. The client relationship is with procurement and finance teams at large corporations, not with a homeowner or small business owner.

But there is an accessible entry point: becoming the solar EPC contractor for a developer who is building a solar plant to supply a DPPA buyer. A solar developer who has secured a DPPA contract needs a reliable EPC to build the generation facility. If you have a track record in commercial or utility scale solar and want to access the DPPA pipeline, the most efficient route is to identify renewable energy developers who are active in the DPPA market and position your EPC capabilities as their delivery partner.

Industrial parks specifically are an accessible starting point. Several Vietnamese industrial park developers and management companies are actively exploring DPPAs for their tenant electricity supply. An EPC who builds a relationship with an industrial park developer can participate in the solar component of a park level DPPA as the construction partner.

Frequently Asked Questions

Q1. What is the minimum system size to qualify for a DPPA in Vietnam?

The minimum size is defined in MOIT's implementing guidance for Decree 57. For the buyer side, the minimum contracted demand or annual consumption threshold must be met. For the generator side, the renewable energy facility must meet minimum capacity requirements. In practice, the DPPA market in Vietnam has been active for solar projects of 3 MW and above (per MOIT Circular 10/2026, effective March 2026), reflecting the scale needed to serve large industrial buyers' full electricity demand. Smaller projects may be viable in consortium arrangements where multiple generators collectively supply a large buyer, or where a large industrial park aggregates demand from multiple tenants. Confirm the current minimum thresholds with a legal advisor familiar with Decree 57 implementation before structuring a DPPA proposal.

Q2. How long does DPPA approval take in Vietnam?

The DPPA approval process under Decree 57 is still relatively new, and processing timelines are still being established. Applications go through the relevant regulatory authority (typically MOIT for larger projects) and require review of the contract terms, grid connection arrangements, and compliance with the decree's requirements. Industry experience from the first wave of DPPA applications in 2025 suggests timelines of 3 to 9 months from application submission to formal approval. Projects involving complex wheeling arrangements across multiple grid zones or large scale capacity tend to take longer. The approval timeline should be factored into project development schedules when advising potential DPPA clients.

Sources

• MOIT Vietnam — moit.gov.vn — Decree 57/2025/ND-CP, effective March 3, 2025, replacing Decree 80/2024/ND-CP — Direct Power Purchase Agreement framework, eligibility, approval process
• RECS International — recs.org — Vietnam country profile — DPPA framework, corporate RE demand, RE100 in Vietnam
• Vietnam Briefing — vietnam-briefing.com — Vietnam energy regulations 2026 — DPPA enabling framework, industrial buyer eligibility
• EVN — evn.com.vn — Vietnam Electricity — wheeling and transmission arrangements under DPPA framework