Circular 62/2025/TT-BCT: Vietnam's standalone BESS pricing framework

What is Circular 62 and why does it matter?

Direct answer. Circular 62 is Vietnam's first legally binding pricing framework for standalone grid-connected battery energy storage. Before it took effect on 26 January 2026, there was no standardised mechanism for pricing power supplied by a BESS to the grid, which is the primary reason Vietnam's original PDP8 target of 300 MW of storage by 2030 produced zero deployed megawatts.

The revised Power Development Plan VIII, approved by the Prime Minister as Decision 768/QĐ-TTg in April 2025, raised the 2030 BESS target to between 10,000 MW and 16,300 MW — a roughly 40-fold increase over the original plan. A target at that scale is only credible if investors have predictable cash-flow terms, lenders have bankable PPAs, and offtakers have a transparent price ceiling. Circular 62 provides all three for the first time. It does not guarantee that deployment will happen at pace — implementation risks remain, including the annual price-bracket approval cycle and unresolved dispatch rules. What it does is convert Vietnam's BESS ambition from conceptual policy signalling into workable commercial machinery.

In practice: Norton Rose Fulbright's January 2026 commentary describes Circular 62 as the first standardised framework mechanism for pricing power supplied by large-scale BESS in Vietnam. That characterisation captures the function precisely — without Circular 62 the 10,000–16,300 MW target would be aspirational; with it, project-level commercial terms become negotiable.

What does the pricing framework actually look like?

Direct answer. Circular 62 establishes an annual electricity generation price bracket ranging from a minimum of 0 VND/kWh to a regulated maximum price. The maximum price is the sum of three components: an Average Fixed Price recovering investment capital, a Fixed Operation and Maintenance Price, and a Variable Price recovering the cost of charging electricity.

Each component is calculated under a defined methodology in the Circular. The Average Fixed Price (Article 5) is the annualised cost of construction investment capital divided by the expected average electricity delivered and received over the BESS's economic life — essentially a levelised-capex figure. The Fixed O&M Price (Article 7) covers major and minor repair costs, labour, and other recurring expenses, set as a VND/kWh component. The Variable Price recovers the cost of charging the BESS, calculated against (a) the BESS's self-consumption and transmission-loss rates during charging and (b) the off-peak retail tariff for manufacturing industries — which under the currently-in-force Decision 1279/QĐ-BCT is VND 1,190/kWh at 22 kV and VND 1,146/kWh at ≥110 kV.

The structural innovation is the dual-revenue treatment. BESS owners receive a Capacity Payment for grid availability independent of actual dispatch — stable cash flow that supports debt service — plus an Energy Payment for electricity actually delivered. This two-part structure mirrors mature-market designs (PJM, ERCOT, the UK capacity market) and is the first time any major ASEAN economy has adopted this model for storage.

In practice: the dual-revenue structure is the single most important feature for bankability. Lenders can underwrite the capacity payment as a contracted-revenue stream analogous to an availability-based PPA, which transforms the debt-service-cover calculation versus a pure energy-merchant asset.

Who is covered and who is excluded?

Direct answer. Circular 62 applies to owners of standalone grid-connected BESS projects meeting the 10 MW / 110 kV thresholds and developed under PDP8 revised, plus EVN, the power corporations, and the system and market operators as counterparties. It does not apply to BESS integrated with renewable power plants, BESS owned by the Power Corporations themselves, or any behind-the-meter C&I storage at a customer site.

The three exclusions matter commercially because they map onto three separate regulatory regimes. BESS integrated with renewable plants — the solar-plus-storage or wind-plus-storage configurations that dominate most new-build C&I projects — is governed by Circular 12/2025/TT-BCT, under which the BESS is treated as part of the generation plant rather than as a standalone asset. BESS owned by Power Corporations — meaning EVN subsidiaries deploying storage on their own accounts — is governed by Circular 17/2025/TT-BCT with its own cost-recovery framework. Behind-the-meter C&I BESS — factories, data centres, and commercial sites installing storage for peak-shaving and arbitrage — is not regulated as a generation asset at all; it interacts with the retail tariff under Decision 1279/QĐ-BCT and, from 1 July 2026 for large manufacturers, the two-part retail tariff under Decree 146/2025/NĐ-CP.

In practice: when advising a C&I client on a BESS investment, the first question is which regulation applies. Ninety-plus percent of Arcus's C&I pipeline sits under Decision 1279 + Decree 146 (retail) rather than Circular 62 (wholesale). Misapplying Circular 62 to a behind-the-meter project — which has happened in early 2026 pitch decks produced by other advisors — misleads the client on both revenue mechanism and approval process.

How is the price bracket approved and adjusted?

Direct answer. Each year before 1 November, EVN submits the proposed price bracket to the Electricity Regulatory Authority (ERA/ERAV, now the Electricity Department under MOIT), which appraises the submission and reports to the MOIT Minister for approval. Once approved, the bracket applies to PPAs negotiated in the following year. Individual project prices within the bracket are negotiated between the BESS owner and the offtake counterparty.

The investor's own workflow begins earlier: within 15 days of the project's feasibility study being approved, the investor must submit a completed pricing dossier to EVN. EVN aggregates across projects and submits to the Electricity Department under the 1 November deadline. The annual price bracket is published as a ceiling; actual contract prices within it are bilaterally negotiated, which introduces negotiating-position uncertainty that standalone BESS is particularly exposed to as a new asset class in Vietnam. The Circular includes detailed pricing, adjustment, and settlement formulas including a foreign-exchange adjustment mechanism — important because almost all BESS capex is imported and VND depreciation otherwise erodes project returns.

In practice: the annual approval cycle means any project reaching financial close in, say, Q2 of a given year will typically be negotiated against the price bracket approved in the prior November. First-mover projects negotiating in 2026 will be doing so against Circular 62's first-ever approved bracket, with limited precedent on where within the 0-to-ceiling range EVN will actually settle. Legal counsel should include change-in-law protection and benchmark-adjustment mechanisms in early-stage PPAs.

What are the open implementation questions?

Direct answer. Three significant implementation gaps remain despite Circular 62 being in force: the annual price-bracket review-and-approval process has no published precedent, operational dispatch arrangements are not fully specified in the Circular itself, and the interaction with Vietnam's evolving wholesale electricity market (VWEM) is still being worked out.

On the first point, the annual price-bracket approval is a new administrative process running for the first time in late 2026; investors and lenders have no historical reference on timing or decision logic. On the second, the Circular prescribes pricing and PPA contents but leaves dispatch scheduling, ancillary-service participation, and grid-integration rules to separate operational guidance. On the third, Circular 62 assumes offtake via EVN or the power corporations, but the longer-term direction of travel — following the broader electricity-market reform agenda — is toward wholesale-market participation. How a standalone BESS transitions from a bilateral PPA under Circular 62 to VWEM participation is not specified.

In practice: early project finance will price these implementation risks into return requirements, which is why the 12% IRR cap (pre-tax nominal WACC basis under Article 5) is tight for a new asset class. Expect the first tranche of Circular 62 projects to either (a) be anchored by strategic investors willing to accept the cap in exchange for first-mover positioning or (b) wait for the first annual approval cycle to produce implementation precedent before committing capital.