Vietnam Confronts Key Challenges in Rooftop Solar Expansion

Energy Box
5 hours ago
3 min read

As Vietnam intensifies its energy transition, rooftop solar is no longer a theoretical option but a strategic reality for many businesses. Recent legislative developments are enabling industrial enterprises to move forward with investment-ready decisions on solar deployment.

A significant signal of this shift is seen among Vietnamese manufacturers, who are transitioning from exploring solar energy to actively implementing solar investment plans, according to SolarBK. New, more detailed provisions under the Electricity Law now provide a clearer legal pathway for renewable energy, setting the strongest conditions to date for rooftop solar development.

“At this time last year, we were still educating clients about the benefits of solar,” said Nguyen Ngoc Quynh, Vice President of SolarBK, added: “Now they’re asking how soon they can install it.”

For many of SolarBK’s industrial clients, solar power has moved beyond just cost savings—it’s now part of broader energy resilience and sustainability strategies. Rooftop solar enables companies to reduce reliance on the national grid, make better use of idle assets like rooftops, and comply with stricter ESG standards from global buyers. It is also viewed as a branding asset for companies competing in low-carbon supply chains.

“Energy autonomy is now considered a form of risk management,” Quynh noted. “It’s about more than efficiency—it’s about building resilience.”

SolarBK’s recent project in Phu Tho Province trialed an integrated legal and grid connection process, streamlining timelines and setting an example for future deployments. The company advocates for a vertically integrated approach—from system design and installation to operation and asset optimisation.

Quynh emphasized that investment levels depend on business priorities. “We advise enterprises to first define whether their goals are cost reduction, emissions compliance, or innovation, and then align with the right technical and financial partners.”

Market momentum is growing. Pham Dang An, Deputy General Director of Vu Phong Energy Group, noted that preparations are underway for Vietnam’s direct power purchase agreement (DPPA) mechanism, expected to roll out by 2026. The DPPA will enable factories to buy clean electricity directly from producers, bypassing state utility EVN—a potential game-changer when combined with leasing models.

Vu Phong is currently rolling out rooftop systems for both local and foreign manufacturers, while expanding operations into Singapore and the Philippines.

“The urgency is especially high among exporters who face mounting pressure to source low-carbon energy,” An said.

Investors are also showing strong interest. Nguyen Huu Quang, Clean Energy Portfolio Manager at Dragon Capital, said rooftop solar already makes economic sense for many manufacturers, with generation costs 10–35% lower than EVN retail rates, depending on location and scale.

Dragon Capital considers rooftop solar to be among the most promising green infrastructure investments in Vietnam, provided the legal framework becomes more flexible. “Currently, companies can only use power they generate themselves,” Quang explained. “If third-party power sales were legally permitted, investment would scale rapidly.”

Still, developers and financial institutions remain cautious. While Power Development Plan VIII (PDP8) outlines ambitious targets—especially in industrial zones—it lacks implementation rules and pricing clarity.

According to Phan Ngoc Anh, Deputy General Director at Deloitte Vietnam, this is the sector’s main bottleneck. “PDP8 gives better guidance than before, but the absence of enforceable policies is holding back large-scale rooftop deployment,” he said.

An added complication is the drop in power purchase tariffs, which has undermined project viability, especially considering installation costs of $1.2–1.3 million per MW. “Without competitive pricing and accessible financing, many rooftop projects remain stalled,” Anh said.

Deloitte Vietnam has identified five persistent challenges for the sector: