BlogXanh: XanhTerra Policy Analysis · 6 June 2026 · Regulatory Analysis
One Rulebook to Replace Two — Commentary on Circular 29/2026 VWEM Rules
The real change is in how power is dispatched, not how it's priced
On 2 June 2026, Vietnam's Ministry of Industry and Trade (MOIT) replaced the Vietnam Wholesale Electricity Market (VWEM) rulebook in a single instrument. Circular 29/2026 keeps the price architecture and the gas-protection regime intact, but it brings battery storage into the dispatch order, adds an intraday re-dispatch cycle, and lowers the private-wire DPPA threshold tenfold.
Ananth Chikkatur — CEO, XanhTerra
Vietnam & Southeast Asia
VWEM
Circular 29/2026
DPPA
BESS
Take-or-Pay
Circular 29/2026: What It Is and What It Does
On 2 June 2026, the Ministry of Industry and Trade issued Circular No. 29/2026/TT-BCT on the operation of the competitive wholesale electricity market (VWEM). It is not an amendment — it is a complete re-issue that repeals both Circular 16/2025/TT-BCT (1 Feb 2025) and its amending Circular 36/2025/TT-BCT (3 Jun 2025), folding the base rulebook and its 2025 patch into a single 11 chapters and 142 articles instrument — with six appendices.
It takes effect on 20 July 2026, with one early-effect carve-out for large users in the direct power purchase agreement (DPPA) mechanism that is already now in effect. Throughout, we treat Circular 16/2025 as amended by Circular 36/2025 as a single "outgoing regime" and compare it against Circular 29/2026.
Change 1
Article 3.46 · Article 4.3(k) · Article 18.3(a)
Storage Enters the Dispatch Order
Under the outgoing regime, battery storage barely featured. The only reference in 16/2025 was inside the Automatic Generation Control (AGC) definition. Under 29/2026, battery energy storage is defined as its own concept and woven through the operating rules. Article 3.46 simply defines BESS as a grid-connected system of batteries, a charger, a controller and associated equipment that stores energy when charging and discharges it when the system needs it.
Most consequentially, in case of overload or over-generation, storage is now the first action the operator takes: charge available batteries to absorb energy and discharge when the system needs it, before any generation is curtailed (Article 18.3(a)).
But the role is operational, not financial. Standalone storage enters 29/2026 as an indirect participant (Article 4.3(k), grouped with pumped-storage hydro): the operator dispatches it using its declared parameters and offer, but the circular settles no payment to it.
Within the wholesale market itself, a BESS earns no energy or capacity settlement; its only potential market-side revenue is for ancillary services — notably AGC/secondary frequency, which Article 3.1 recognises and Appendix III compensates. Its energy and capacity are paid instead through the regulated tariffs (Circular 17/2025/TT-BCT or Circular 62/2025/TT-BCT), not the spot market.
What BESS Must Register
A BESS must register with the National System and Market Operator (NSMO) a full technical data set (Appendix VI): min/max charge–discharge power and installed MWh capacity, ramp rate, state of charge limits and round-trip efficiency, variable costs and a use-of-system charge, daily and annual cycle limits, and an offer. In market-operation planning (Appendix I) the operator simulates and co-optimizes the battery with hydro. The battery self-declares its offer to NSMO, but it does not self-dispatch at the owner's discretion. The battery's dispatch is scheduled by NSMO within the annual/seasonal plan and the intraday cycle.
The Locational Caveat
The first-priority dispatch runs on the constrained schedule, which respects transmission and distribution limits — so the operator can only charge storage that is electrically able to absorb the specific local surplus. The market price is set from the unconstrained schedule, with no locational component at the level where constraints actually bind. "Storage-first" is an operational instruction, not a siting signal: being in the right place gets you dispatched, but earns no price premium for being there.
📌 Insight 1
Storage moves from a definitional footnote (AGC only, in 16/2025) to a first-priority dispatch tool in over-generation conditions (Article 18.3(a)).
📌 Insight 2
The role is operational, not a market settlement: BESS is an indirect participant (Article 4.3(k)) dispatched by the operator and paid through Circular 17, Circular 62, or the RE pricing — so value capture depends on the investment track and location.
Impact of "Storage-First" Rule by Investment Track
Article 18.3(a) affects the three main investment tracks for BESS in Vietnam very differently, depending on how each is paid and where it is sited.
Change 2
Article 3.17 · Article 48 · Article 60–62
A New Intraday Dispatch Cycle
The outgoing regime had no intraday scheduling concept. 29/2026 introduces a within-day calculation and dispatch cycle, defined at Article 3.17 (chu kỳ tính toán trong ngày vận hành D — run every 8 hours), operationalized through the intraday offer (Article 48), intraday scheduling data (Article 60), the intraday schedule (Article 61), and its publication (Article 62).
This sits alongside the existing next-year / next-month / next-week / next-day / next-cycle planning ladder, adding an explicit intraday re-optimization step, while the trading and dispatch cycles themselves remain at 30 minutes (Article 13). The market-operation-planning and real-time-dispatch appendices (Appendix I and II) carry the intraday recalculation through the scheduling chain, so the within-day step is now an explicit layer of the operating plan rather than an ad-hoc redispatch.
1
Re-Plans Within the Day
The market now re-plans dispatch within the operating day, not just day-ahead and cycle-ahead. This tightens the link between forecast error (especially for variable renewables) and re-dispatch.
2
Changes Offer-Update Windows
The intraday offer changes when generators can update their offers. Operators and generators need to map their new re-declaration windows under the 8-hour cycle.
3
Finer Tools for RE Growth
Combined with storage-first curtailment, this gives the operator finer intraday tools to manage growing solar and wind shares. This directly benefits DPPA renewable generators.
Change 3
Article 1.2 · Article 2.6 · Article 3.51 · Article 48, 60–62
DPPA Gets a Real Home in the Market
Large electricity users in the direct purchase mechanism were already a regulated subject under 16/2025 (Article 2.6). What 29/2026 does is give the DPPA a sharper, more workable place inside the wholesale-market rules — in three ways.
1
A Lower Private-Wire Eligibility Threshold — Genuinely New
The eligibility thresholds now sit directly in the definition (Article 3.51): ≥ 200,000 kWh/month for direct purchase via the national grid; ≥ 20,000 kWh/month for direct purchase via a dedicated private connection.
Circular 29/2026 Article 3.51 is the first instrument to split the threshold — a tenfold reduction for private-wire, widening eligibility to a far larger tier of mid-sized commercial and industrial offtakers that previously fell below the cut-off. For the private-wire model, this is the single most market-opening change in the circular.
2
Elevated and Fast-Tracked Scope
The DPPA interface is already live. Circular 29/2026 splits the large-user DPPA out as a standalone scope provision (Article 1.2), hard-wires the Decree 57/2025/ND-CP reference into Article 3.51.
Both that scope provision and the threshold definition are in force already!
3
The Intraday Cycle Is the Operational Backbone for Grid DPPA Generators
Through the intraday offer (Article 48) and intraday scheduling (Article 60–62), a DPPA generator can re-declare available capacity and have dispatch re-optimized up to three times within the operating day, rather than being locked to a schedule set the day before.
For a solar or wind generator, that means the schedule can track the resource as the day's forecast firms up — reducing deviation, tightening settled volumes, and making a variable-renewable DPPA position materially more manageable.
Change 4
Article 18
A Longer, Smarter Curtailment Merit Order
The over-generation / overload reduction order lives in Article 18 under both regimes. The reduction stack grew from eight tiers (a–h) in the outgoing regime (taken to a–k by 36/2025's must-run-gas carve-outs) to thirteen tiers (a–n) in 29/2026 Article 18.3.
📌 Resource-Type Granularity
The reduction stack is now resource-type granular. Biomass and waste-to-energy are treated distinctly from wind/solar, reflecting their fuel-storage characteristics rather than lumping all "renewables" together.
📌 Within-Tier Fairness Preserved
The even-distribution principle (curtail proportionally within a tier, ignore price) is preserved at Article 18.4, so within-tier fairness for like assets is unchanged.
Change 5
Article 3.78
The Take-or-Pay (Bao Tiêu) Envelope Widens
The take-or-pay obligation (bao tiêu) is the must-take volume the system honors regardless of merit-order economics — and it directly determines how much room is left for competitive dispatch.
Outgoing Regime
- (a) The Build-Operate-Transfer (BOT) minimum-offtake commitment
- (b) The maximum-gas operational volume for must-run domestic-gas plants
29/2026 (Article 3.78)
- (a) BOT minimum-offtake commitment + committed offtake under electricity import contracts
- (b) The maximum-gas operational volume for must-run domestic-gas plants
The envelope has therefore widened to capture import-contract commitments — consistent with 29/2026's expanded treatment of import handling in scheduling and payment (Article 75, 76).
For Modelers and Financiers
Anyone modeling must-run volumes and the residual space for competitive dispatch should refresh their assumptions, including the new import-contract limb.
Data Chain Tightened
The data chain feeding the take-or-pay calculations is also tightened by the new fuel-supplier obligations (see Change 6 below), adding a further layer of accountability to the must-run calculation.
Change 6
Article 2
Fuel Suppliers Become a Regulated Subject
Circular 16/2025 Article 2 named six categories of regulated entities. And now, Circular 29/2026 Article 2 adds a seventh: the Fuel Supply Unit (Đơn vị cung cấp nhiên liệu). This formalizes fuel suppliers' obligations to provide gas-supply capability and fuel-constraint data used in the must-run gas and take-or-pay calculations (Article 3.78), rather than treating them incidentally.
The obligation is concrete: fuel suppliers must file a defined data set (Appendix VI) to NSMO, including forward monthly fuel prices for the year ahead and the month ahead, and fuel-supply limits (an hourly cap and a total cap). The information feeds directly into the NSMO year/month operating plan, the must-run gas dispatch, and the take-or-pay volumes.
Tighter Data Chain
Formalizing fuel suppliers tightens the data chain underpinning must-run gas dispatch — consistent with the gas-protection thrust running through both 36/2025 and 29/2026.
Accountable Market Subjects
Fuel suppliers move from incidental data providers to accountable market subjects with defined responsibilities and a formal filing requirement under Appendix VI.
Continuity
Article 25–28 · Article 86–87 · Article 26 · Article 13
What Did NOT Change
Just as important for planning is what 29/2026 leaves alone. The entire price-formation spine — the System Marginal Price (SMP), the capacity add-on price (CAN), and the best-new-plant benchmark — is carried across unchanged, and the article numbers often line up exactly.
Two-Part Price
Unchanged. Total market price = market electricity price + market capacity price (CAN).
SMP (Market Electricity Price)
Unchanged. The same marginal-band rule and market price ceiling.
Market price ceiling is still ≤ 115% of the highest thermal offer.
CAN (Market Capacity Price)
Unchanged. The architecture and all six shortfall-recovery equations are identical.
Best New Power Plant
Definition and selection are unchanged: a coal-fired or combined cycle gas turbine baseload plant commissioned in year N–1 with the lowest average full generation cost, ranked annually. Its average generation price feeds the CAN, same as 16/2025.
Participation Taxonomy
Direct vs. indirect, and direct-transactional vs. indirect generating units, are retained (Article 3).
30-Minute Trading & Dispatch Cycles
The 30-minute trading and dispatch cycles (Article 13), the planning-ladder backbone, and the metering/payment architecture are all unchanged.
What This Means for You?
Circular 29/2026 modernizes the operating layer of Vietnam's wholesale market. The headline price architecture (Article 27–28, 87) is stable; the changes are all in the dispatch (Article 18), intraday operation (Article 48, 60–62), and the DPPA interface (Article 1.2, 3.51).
Generators
Where do your offer and re-declaration windows fall under the new 8-hour intraday cycle? Which curtailment tier are you in, and who is curtailed before you?
Storage Developers
Merchant standalone (Circular 62): are you underwriting on the capacity leg and treating the Article 18.3(a) energy upside as locational and conditional?
EVN-directed and RE-mandated co-located storage: does the grid allow you to take advantage of "storage-first" under over-supply conditions? Do you have locational constraints?
Renewable Developers & Large Users (DPPA)
Does your offtaker now clear the 20,000 kWh/month private-wire threshold? For grid DPPA, how does intraday re-declaration reshape your settled volume and imbalance exposure?
Fuel Suppliers
Are your data-provision processes ready for your new status as a regulated subject?
Financiers
Are your dispatch and must-run assumptions built on the current definitions, including the widened take-or-pay envelope?
Cross-Reference Map: Outgoing Regime → 29/2026
About the Author
Ananth Chikkatur is the CEO of XanhTerra, an energy consulting and advisory firm operating in Southeast Asia. He holds a doctoral degree from MIT, conducted post-doctoral research at the Harvard Kennedy School, and brings 20+ years of energy-sector experience across Vietnam, Southeast Asia, and South Asia power markets. XanhTerra specializes in AI-assisted modeling, cost of flexibility analysis, and regulatory and policy advisory for VWEM, C&I solar, BESS, and DPPA projects across the region.
This briefing reflects XanhTerra's reading of Circulars 16/2025, 36/2025, 62/2025 and 29/2026/TT-BCT and Decree 57/2025/ND-CP. It is provided for information and is not legal advice.
Vietnam Energy
VWEM
Circular 29/2026
DPPA
Decree 57/2025
BESS
Take-or-Pay
Wholesale Market
Southeast Asia