Vietnam caps gas-fired power prices at $0.13 per kWh for 2026

Issued under Decision No. 1882, which took effect on July 23, the decision establishes a framework for power price ranging from zero to VND 3,410.64 per kWh for combined-cycle gas turbine plants. 

State utility Vietnam Electricity (EVN) and power generation companies will use the framework as the baseline to negotiate power purchase agreements (PPAs).

The ceiling was modeled on a 1,008 MW benchmark facility operating at 85 percent load, factoring in a natural gas price of $11.98 per million BTU, delivery costs of $1.87 per million BTU, and an exchange rate of VND26,378 to the U.S. dollar.

The price cap provides the operational parameters for broader government incentives introduced under Decree 100, which aims to unblock billion-dollar gas power investments and stabilize the national grid.

A key pillar of Decree 100 is the full pass-through of fuel costs into electricity tariffs, insulating developers from global gas price volatility. 

To make projects bankable for foreign lenders, the decree guarantees imported LNG projects a minimum long-term contract output rate of at least 65 percent of average capacity during the loan repayment period (up to 10 years) for plants operating before 2031. 

For domestic gas projects coming online before 2036, the state guarantees maximum dispatch aligned with domestic gas extraction capabilities.

As Vietnam integrates higher shares of intermittent solar and wind power, flexible gas and LNG generation has become critical for baseload grid reliability. 

By establishing clear fuel pass-through rules, minimum purchase guarantees, and now an official pricing ceiling, Vietnam aims to resolve long-standing PPA negotiation deadlocks and accelerate key projects across the country.