Singapore and Vietnam Advance ASEAN Power Grid Goal through Offshore Wind Power Trade Cooperation and Cross-Border Electricity Trade
On 12 March 2025, Singapore and Vietnam endorsed the Joint Report on Offshore Wind Power Trade Cooperation between Vietnam and Singapore (“Joint Report“):
- facilitating regulatory approvals and licenses from both governments for renewable energy development and cross-border electricity trade (“CBET“);
- enabling deeper bilateral cooperation in infrastructure development, research, technology, and capacity-building; and
- affirming the shared commitment to work closely with other Association of Southeast Asian Nations (“ASEAN“) Member States to achieve the goal of realising the ASEAN Power Grid by 2045, including developing a framework and terms of reference for subsea power cables.
Building on the Joint Report and an earlier Memorandum of Understanding (MOU) on energy cooperation between Singapore and Vietnam in 2022, Singapore and Vietnam signed a Letter of Intent to enhance cooperation in CBET for the ASEAN Power Grid on 26 March 2025 to:
- reaffirm both countries’ commitment to establishing a sustainable, inclusive, and resilient ASEAN Power Grid. This Grid will consist of multiple energy interconnections to advance ASEAN’s vision of multilateral and multidirectional cross-border power trade and enhanced energy security;
- explore ways to increase the targeted capacity of low-carbon electricity imports from Vietnam to Singapore to approximately 2GW by 2035, building on the capacity conditionally approved under the Project; and
- continue engagement with interested companies that have credible and commercially viable proposals.
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Enactment of Government Decrees in the Energy Sector: Electricity Operation Licences (Decree 61/2025/ND-CP)
On 4 March 2025, the Government passed Decree 61/2025/ND-CP prescribing detailed regulations for the Law on Electricity on electricity operation licences (“Decree 61“). Decree 61 came into effect on the same day.
Decree 61 is the primary regulation (under the 2024 Law on Electricity) that stipulates the conditions, procedures and other provisions concerning the issuance of electricity operation licences to companies in Vietnam.
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Enactment of Government Decrees in the Energy Sector: Renewable Energy and New Energy (Decree 58/2025/ND-CP)
On 3 March 2025, the Government passed Decree 58/2025/ND-CP prescribing detailed regulations for the Law on Electricity on the development of renewable energy and new energy (“Decree 58“). Decree 58 came into effect on the same day.
Decree 58 regulates the development of renewable energy sources (i.e. solar, wind, and biomass, etc.) and new energy technologies (potentially including innovations like energy storage or hydrogen-based solutions). For rooftop solar power in particular, Decree 58 makes it clear that the Government has favoured the use of a self-production and self-consumption model.
Decree 58 establishes a legal framework to encourage the renewable energy and new energy sectors through specific policies and incentives, including preferential policies for investors.
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Enactment of Government Decrees in the Energy Sector: Direct Power Purchase Agreements (Decree 57/2025/ND-CP)
On 3 March 2025, the Government passed Decree 57/2025/ND-CP which regulates the mechanism for direct electricity trading between renewable energy generation units and large electricity consumers (“Decree 57“). Decree 57 came into effect on the same day.
Decree 57 establishes the legal framework for direct power purchase agreements signed between renewable producers and large electricity consumers (i.e. private line transactions). It paves a clearer path for investors to directly sell electricity to its customers, without having to connect to Vietnam’s national grid. The terms of such agreements will be subject to the parties’ negotiation, and there is no statutory form which they will take.
Decree 57 also regulates arrangements by which producers can sell power using virtual/synthetic power purchase agreements.
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New Regulations in the Environmental Sector Passed
On 6 January 2025, the Government passed Decree 05/2025/ND-CP amending and supplementing a number of articles of Decree No. 08/2022/ND-CP (“Decree 05“). The amended Decree 08/2022/ND-CP provided guidance for certain of articles of the Law on Environmental Protection. Decree 05 came into effect on the same day.
Decree 05 sets forth detailed regulations in the environmental sector, including on environmental licensing, wastewater management, and recycling responsibilities.
One of the most significant changes introduced by Decree 05 are provisions on extended producer responsibility (“EPR“). In addition to manufacturers and importers, Decree 05 expands the scope of EPR regulations to entities that are responsible for the quality and labelling of products/goods in Vietnam. It also updates the list of products and packaging that are subject to recycling or waste treatment.
Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice
