News and Thinking

Ambitious Energy Demand Management Policy – Directive No. 10/CT-TTg

Posted on by Ngọc Anh

By Nguyen Thanh Nghiep | April 2026

On March 30, 2026, Prime Minister Phạm Minh Chính signed Directive No. 10/CT-TTg on strengthening electricity conservation and rooftop solar development. This is the second energy directive issued within two weeks – following Directive 09/CT-TTg (March 19) on energy saving, energy transition, and electric vehicle development – signaling that the government views energy demand management as a national security priority, not merely an environmental aspiration.

While the rooftop solar targets have received the most coverage, this directive is far more comprehensive – it is effectively a master framework for restructuring how Vietnam produces, distributes, consumes, and finances electricity at every level of society. Let me walk through the key dimensions.

#Issue 1

BESS – From Optional Add-On to Policy Priority

For years, battery storage was the missing piece in Vietnam’s rooftop solar story. The intermittency of solar generation, combined with grid constraints on surplus feed-in, meant that RTS systems without storage had limited value beyond daytime self-consumption.

Directive 10 changes this positioning. The Prime Minister explicitly encourages BESS integration across all categories – public offices, factories, commercial buildings, and households – to reduce peak-hour load and increase on-site energy self-sufficiency. The Ministry of Finance and State Bank have been tasked with designing green credit and preferential loan packages specifically covering both RTS and BESS installations, with proposals due by April 2026.

This aligns with the evolving draft support policy, which reportedly proposes subsidies of VND 1–1.5 million/kWh for BESS alongside VND 1–1.5 million/kWp for rooftop solar. For the C&I sector, the combination of RTS + BESS + the new DPPA mechanism under Decree 57/2025 creates a compelling investment stack.

Unlock ESCOs

Directive 10 explicitly calls for financial mechanisms to promote the ESCO (Energy Service Company) market and the establishment of a dedicated Energy Efficiency and Conservation Fund (Quỹ sử dụng năng lượng tiết kiệm và hiệu quả).

Vietnam has roughly 200+ energy efficiency service providers, but the true ESCO model — where companies finance, install, and guarantee energy savings through performance contracts – remains severely underdeveloped. Most operators lack balance-sheet capacity, and the legal framework for Energy Savings Performance Contracts has been insufficient.

What Directive 10 signals for ESCOs:

  • Government-led demand creation – With mandated savings targets across public offices, large consumers, and industrial facilities, there is now a structured customer pipeline for ESCO services. Facilities consuming 500,000+ kWh/year face a non-negotiable 3% savings requirement.
  • Financial ecosystem development – The proposed Energy Efficiency Fund, combined with EVN’s DSM cost recovery mechanism, could provide the capital recycling infrastructure that ESCOs need to scale.
  • Sandbox experimentation – EVN is instructed to propose controlled regulatory sandbox mechanisms for financial instruments that incentivize electricity savings – opening the door for innovative performance-based financing.

Building the Capital Stack – Green Financing

Perhaps the most market-moving element of Directive 10 is the explicit instruction to build financing infrastructure for distributed energy at multiple levels:

  • Ministry of Finance: Allocating state budget resources for RTS support policies.
  • State Bank of Vietnam: Designating credit focal points and proposing lending frameworks for RTS/BESS.
  • Provincial People’s Councils: Required to enact local support policies by May 2026 under Article 22(2) of the 2024 Electricity Law.
  • Green credit/preferential credit packages: For both households and enterprises.

The estimated investment required for the 2026–2030 RTS development plan is approximately VND 42,000 billion (~USD 1.7 billion). International DFI, credit fund and other sources of capital are already flowing. But scaling to meet targets requires domestic commercial banks to significantly expand green lending portfolios.

The directive also mandates financial support for public building RTS installations – a category that has historically been neglected because government procurement procedures create barriers to third-party ESCO arrangements. If budget allocation mechanisms are properly designed, this could unlock a significant new market segment.

Vietnam’s energy transition is entering a new phase. The era of waiting for FiT-style production subsidies is over. What’s emerging is a market-based, financing-enabled, accountability-driven model for managing energy demand and scaling distributed generation. Directive 10 is not just about saving electricity – it’s about restructuring how Vietnam’s entire economy relates to energy.

For anyone in the BESS, ESCO, RTS, green finance, smart grid, building efficiency, or industrial energy management space operating in or eyeing Vietnam, the policy window is wide open. The question now is execution speed.