Decree 243: New Regulations for Rooftop Solar Power and DPPA Implementation
Just over a year after the issuance of Decree 57 on the direct power purchase agreement (DPPA) mechanism and Decree 58 on the development of self-consumption rooftop solar power, the Vietnamese government has continued to issue Decree No. 243/2026/ND-CP on June 26, 2026, to amend and supplement certain provisions of these two decrees. The policy adjustment within such a short timeframe demonstrates that state management agencies have promptly addressed practical obstacles to improve the legal framework for Vietnam's renewable energy market.
Background of Decree 243
During the 2020-2025 period, Vietnam achieved significant milestones in rooftop solar power development with a total installed capacity reaching nearly 10,000 MW. However, the implementation process revealed numerous shortcomings, particularly in the DPPA mechanism between electricity producers and large consumers.
According to a report from the Ministry of Industry and Trade, after one year of implementing Decrees 57 and 58, more than 200 projects registered to participate in the DPPA mechanism, but only about 30% of these projects were licensed. The remaining projects encountered legal procedures, pricing mechanisms, and grid technical issues.
Key Highlights of Decree 243
Decree 243/2026/ND-CP introduces several important provisions aimed at removing obstacles for the rooftop solar power market and the DPPA mechanism:
- Rooftop Solar Power Project Capacity Limits: Expands the capacity limit from 1 MW to 10 MW per project, aligning with the actual scale of large enterprises.
- DPPA Contract Term: Extended from 10 years to 15 years, providing investors with a longer period for capital recovery.
- Electricity Pricing Mechanism: Clearly stipulates the method for calculating electricity prices for the DPPA mechanism, ensuring competitiveness and transparency.
- DPPA Participation Conditions: Relaxes geographical distance requirements between producers and electricity buyers, increasing from 5km to 10km.
- Administrative Procedures: Simplifies the licensing process, reducing processing time from 45 days to 30 days.
Comparison Between Decrees
| Factor | Decree 57/2025 | Decree 58/2025 | Decree 243/2026 |
|---|---|---|---|
| Capacity Limit | 1 MW | 1 MW | 10 MW |
| DPPA Contract Term | 10 years | Not specified | 15 years |
| DPPA Distance | 5km | Not specified | 10km |
| Processing Time | 45 days | 45 days | 30 days |
Implementation Steps According to Decree 243
To effectively implement Decree 243, the Ministry of Industry and Trade has issued detailed guidelines with specific implementation steps:
1. Project Registration
- Investors submit registration documents to the Department of Industry and Trade of the province/city where the plant is located
- Documents include: Investment registration certificate, technical plan, potential power purchase agreement
- Processing time: 30 working days
2. Inspection and Evaluation
- Grid technical inspection unit confirms grid acceptance capacity
- Energy agency evaluates project feasibility
- Evaluation period: 15 working days
3. Contract Signing
- Power producers and buyers sign direct power purchase agreements
- Contracts must notarized according to legal regulations
- Submit notarized contract copies to the Department of Industry and Trade
4. Project Implementation
- Complete construction and acceptance of the power plant
- Connect to the grid according to the approved design
- Bring the plant into commercial operation
5. Monitoring and Reporting
- Periodically report on electricity production and sales volume
- Report on operational status and incidents (if any)
- Update changes in technology and production scale
Expected Impact of Decree 243
According to energy experts, Decree 243/2026/ND-CP will generate positive impacts:
- Rooftop Solar Power Growth: Expected to grow by 200% in the next 3 years, reaching a total installed capacity of 20,000 MW.
- Foreign Investment Attraction: A transparent legal environment will attract additional strategic investors to the renewable energy sector.
- Reduced Fossil Fuel Dependence: Decrease of 5-7% in electricity demand from coal and gas power plants.
- Job Creation: Create approximately 50,000 direct and indirect jobs in the renewable energy sector.
Expert Reactions
According to Mr. Nguyen Van Tung, an energy expert from the Vietnam Energy Institute: "Decree 243 is a necessary step to improve the legal framework for the rooftop solar power market. Expanding capacity limits and contract terms will create conditions for small and medium-sized enterprises to participate, while attracting additional strategic investors."
Ms. Tran Thi Mai, Director of Innovation Solar Energy Company, shared: "We highly welcome the changes in Decree 243, especially the simplification of administrative procedures. This will help reduce costs and time for investors, thereby promoting rooftop solar power development in Vietnam."
Conclusion
Decree 243/2026/ND-CP marks a significant step in improving policies for rooftop solar power development and direct power purchase agreements in Vietnam. With new provisions regarding scale, duration, procedures, and pricing mechanisms, this decree is expected to resolve practical implementation challenges, creating momentum for the sustainable development of the renewable energy sector, contributing to the government's net zero commitment by 2050.
However, for the decree to be effective, close coordination between ministries, sectors, localities, and the business community is required. At the same time, policy communication and dissemination to investors and the public need to be strengthened to ensure smooth implementation.