According to the conclusion of the Government Inspectorate, the Ministry of Industry and Trade had shortcomings and violations when advising on the incentive mechanism for solar power projects in Ninh Thuan, leading to 14 projects enjoying the preferential FIT price of 9.35 cents/kWh. for 20 years in violation of regulations.
'Big man' makes solar power, completes trillion-dollar project in a few months
In the list of 14 projects with a total capacity of 964 MW that have been applied an incorrect price of 9.35 cents/kWh at the inspection conclusion, there is Phuoc Ninh Solar Power Plant.
The above factory has a capacity of 45 MWp, total investment of more than 1,000 billion VND, the investor is Ninh Thuan Energy Industry Joint Stock Company - part of T&T Group.
Phuoc Ninh solar power plant officially joined the national grid in June 2020 - Photo: T&T Group
In June 2020, Phuoc Ninh solar power project was inaugurated after less than 4 months of construction. Speaking at the inauguration ceremony, leaders of the Ministry of Industry and Trade said "the operation of the factory marks an important milestone for T&T Group when investing in the energy sector".
In addition to Phuoc Ninh, T&T Group companies also operate three other solar power plants, including: Hong Liem 3, Thien Tan 1.2 and Thien Tan 1.3. All three were connected to the power grid at the end of December 2020, information from the T&T Group website.
According to the basic financial indicators report, Ninh Thuan Energy Industry Joint Stock Company lost 83 billion VND in the semi-year 2023, while the same period had a profit of nearly 4.6 billion VND.
In both 2021 and 2022, this business lost VND 22 billion and VND 106 billion respectively. Long losses, business equity as of June 30, 2023 is 1,038 billion VND, down 18% over the same period last year.
The debt/equity ratio of Ninh Thuan Energy Industry Joint Stock Company is 2.55 times, equivalent to more than 2,600 billion VND, mainly bond debt.
Another project - Thuan Nam Duc Long Solar Power Plant, with a total investment of more than 1,000 billion VND, invested by DLG Ninh Thuan Solar Power Joint Stock Company, also appears in the list of 14 projects enjoying incorrect FIT.
The investor of the above project was a member company of Duc Long Gia Lai Group. By September 2019, Duc Long Gia Lai Group transferred all shares.
Thuan Nam Duc Long project also has a quick construction time, taking only 3.5 months. Construction started in mid-September 2019, and the electricity was turned on by the last day of this year.
Regarding Duc Long Gia Lai, this group was once famous in the fields of wood production and processing, real estate, and components, then turned to energy.
Enjoying the preferential purchase price of 2,086 VND/kWh is an important catalyst for many businesses, including Duc Long Gia Lai, to invest in renewable energy.
But it seems that this segment has not yet "saved" business results. In 2022, Duc Long Gia Lai has a record loss after tax of VND 1,197 billion. In the first 9 months of 2023, this group returns to profit after tax with more than 50 billion VND.
Transfer of solar power company, profit of hundreds of billions of dong
Bau Ngu Lake solar power plant (compartment 473) of Truong Thanh Construction Investment and Development Joint Stock Company also enjoys FIT incentives contrary to regulations.
Construction started in March 2019, with an investment capital of 1,457 billion VND, the project was energized in November 2019.
On its website, Truong Thanh said it aims to become the leading renewable energy developer in Vietnam in the next 5 years.
Regarding the business situation, financial report data over the past 6 years shows that Truong Thanh's profit after tax has improved significantly. From an after-tax profit of more than 92 billion VND in 2018, it has increased to more than 204 billion VND in 2022. In the first 9 months of 2023, the after-tax profit is again 94 billion VND, down 45% over the same period.
In a document sent to the Securities Commission, Truong Thanh explained that due to the unfavorable hydrological situation since the beginning of the year, revenue decreased.
The business also revealed that the operation of solar power plants is stable, production and business costs are maintained at a stable level with no unusual fluctuations.
In the list of 14 projects, there is also Solar Farm Nhon Hai Solar Power Plant - Licogi 16 Ninh Thuan Renewable Energy Investment Joint Stock Company with a capacity of 35 MWp, operated since July 2020.
Licogi 16 Ninh Thuan renewable energy used to belong to Lizen Joint Stock Company (former name Licogi 16 Joint Stock Company).
However, Lizen's 2022 audited financial report shows that the company has completed transferring 100% of Licogi 16 Ninh Thuan shares to partners with a transfer fee of more than 477 billion VND. The profit recorded in the report is more than 242 billion VND.
In addition to selling Licogi 16 Ninh Thuan, Lizen also sold Licogi 16 Gia Lai Renewable Energy Investment Joint Stock Company for 194 billion VND.
At the same time, Licogi 16 Quang Tri 1 Wind Power Joint Stock Company and Licogi 16 Quang Tri 2 Wind Power Joint Stock Company are dissolved in October 2022.
In the first 9 months of this year, Lizen reported a 66% decrease in profit after tax over the same period, to only 55 billion VND. The reason the company said is because this year there is no revenue coming from capital transfer activities like last year.
Looking at Lizen's business journey, it can be seen that this business's profit has clearly improved from 2018 to now with a profit of hundreds of billions of dong. Of which, the highest was in 2020 with 311 billion VND.
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In addition to the above projects, the list of 14 solar power projects receiving FIT prices in contravention of regulations according to the conclusion of the Government Inspectorate also includes: Hacom Solar Factory of Hacom Energy Joint Stock Company; Sinenergy Ninh Thuan 1 of Sinenergy Ninh Thuan Energy Company Limited;
Thien Tan Solar Ninh Thuan of Thien Tan Solar Ninh Thuan Joint Stock Company, My Son of My Son 1 Solar Joint Stock Company, My Son 2 of My Son 2 Solar Joint Stock Company, Bau Zon project of Energy Company Limited sun TT.Sunlim;
Thuan Nam 12 of Thanh Vinh Solar Joint Stock Company; SP Infra 1 of Surya Prakash Vietnam Energy Co., Ltd., Adani Phuoc Minh of Adani Phuoc Minh Solar Power Co., Ltd. and a 450MW solar power project combining 500kV Thuan Nam substation and 500kV, 200kV lines.
