Implementing the Vietnam offshore wind power project

In Vung Tau city has been held the signing ceremony on comprehensive cooperation between the Singapore Enterprize Energy & RE Global Solution and the associate of PetroVietnam Construction Joint Stock Corporation (PVC) and Vietsovpetro (VSP) to develop an offshore wind power project in Vietnam. The project is located in 30 km from Binh Thuan sea coast and has a capacity of 1200 MW, total investment level of US$ 3.5 billion. The investment of the project will be diverged in two phases as 600 MW in 2018 - 2021 and 600 MW in 2021 – 2023.

                    

The associate PVC – VSP has achieved the agreements with the investors on comprehensive cooperation to manufacture the offshore wind turbines (OWT) with the towers and the offshore tranformer stations (OSS), as well as transport an install all the equipment and building companens of the project.

The sides have agreed to cooperate in all the fields relating to the project such as development, finance, construction, property, operation and mantainance in a series of periods suitable with the plan of using financial resources for manufacturring (in 2019 - 2020), corresponding to the ofshore installing (beginning in 2021).

Solar energy industry poised to take off

The investment rate in solar power systems is now just equal to 20-30 percent of the rate of 10 years ago.

According to the Electricity of Vietnam (EVN), Vietnam has about 30 solar power projects, a figure which, according to Le Chi Hiep, chair of the Institute of Sustainable Energy Research, an arm of the HCMC National University, is modest compared with Vietnam’s great potential in solar energy.

Mr Le Chi Hiep from the HCMC National University

In Vietnam, solar power began in 1990 and significant development has occurred since 1999. Many families have used solar power to heat water. HCMC University of Technology has installed many solar panels in the last 2-3 years.

However, the proportion of solar power works is still modest in comparison with power from fossil fuels.

In an effort to increase the number of solar power works, EVN recently committed to buy electricity from households’ solar power works at VND2,000 per kwh.

Hiep said that the core issue in developing solar power lies in economic benefits, not in technological solutions.

Therefore, the state needs to create an open and competitive market for investors to develop solar power projects.

“The price of VND2,000 per kwh is not attractive enough to investors,” Hiep said.

Workshop spotlights renewable energy investment in Vietnam

A workshop was held in Ho Chi Minh City on December 5, focusing on investment in renewable energy in line with Vietnam’s policy of developing alternative energy sources to ensure energy security and protect the environment.

The Bac Lieu wind power plant - Photo: VNA

In his remarks, Bo Monsted, Commercial Counsellor at the Danish Embassy in Vietnam said international investors, including those from Denmark, are very interested in Vietnam’s market with untapped huge potentials for wind power development, noting that with its experience and expertise, Denmark desires to share new technologies with Vietnam.

Pham Trong Thuc, a representative of the Vietnamese Ministry of Industry and Trade described the event as an opportunity to introduce the country’s wind power potentials and incentives for investors in the field.

The Government of Vietnam has adopted numerous incentives to encourage capable international businesses to invest in wind power and transfer their technologies to local producers, he said.

Vietnam’s wind power potentials have not been fully exploited, particularly in the central region. There are only four operational projects with a combined capacity of more than 159 MW.

WB asks Vietnam to modify PPA on Renewable Energy

On December 11, 2017, in Hanoi at the working meeting on renewable energy (RE) development between Mr. Tran Tuan Anh, the Minister of Industry and Trade (MoIT) and Mr. Ousmane Dione, the National Director of the World Bank (WB) in Vietnam, Mr. Ousmane Dione asked Vietnam to modify the power purchase agreement (PPA) on RE in accordance with the most common international practice under the neutral jurisdiction.

Mr. Ousmane Dione said, currently WB is trying the best to find the ways to attract the international experts and private capitals for RE market in Vietnam. Therefore, it is suggested that Vietnam should soon create a legal framework, improve mechanisms and policies, firstly the existing regulations on RE prices. Beside the current feed in tariff (FiT) mechanism, the investment in procurement for RE projects through the auction system with samples of the international banks will allow Vietnam to cut the costs.

The Minister Tran Tuan Anh promised to consider this proposal of WB and carefully weigh it for each type of RE and informed that in recent years, the Vietnamese government has paid considerable attention to the development of renewable energy such as issued the strategy of RE development, set specific targets for each type of RE in the National Power Planning No VII (revised project).

Vietnam should speed up renewable energy development

Vietnam should develop renewable energy sources in a timely manner in order to meet the rising demand for electricity in the years to come, according to industry watchers.

A wind power project in the south-central coast province of Binh Thuan. Experts stress Vietnam should quickly develop renewable energy

Vietnam’s demand for electricity is seen picking up strongly, 265 billion kWh by 2020 and 570 billion kWh by 2030 compared to the current 170 billion kWh, according to a recent conference on the development of renewable energy.

The country’s power supply is heavily dependent on hydropower, coal-fired thermal power and gas which are gradually becoming exhausted in the coming years.

Industry experts said Vietnam should make use of potential power sources like renewable energy, and purchase more electricity from neighboring China, Laos and Cambodia in a bid to offset a possible shortfall of 100 billion kWh by 2020.

The development of wind, solar, and biomass power should be paid special attention to, as the growth of renewable energy has become a sustainable trend in which many countries are pursuing.

The Government is striving to reach 12 billion kWh of renewable energy by 2020. The figure is expected to amount to 89 billion kWh by 2030.

Meanwhile, despite increasing investments, wind, solar and biomass power sources are currently having modest capacities of around 100 MW, 15 MW and 10 MW respectively, well below potentials.

Tran Viet Ngai, chairman of the Vietnam Energy Association, told the Daily on August 1 that the country’s topographic and climatic characteristics are favorable for wind, solar and biomass power development.

Ngai suggested several solutions to prop up investments in renewable energy. In particular, local governments should create favorable conditions for investors to have sufficient land to develop such power generation facilities.

Besides, electricity prices should be adjusted in a reasonable manner. For instance, prices of wind and biomass power should be raised to some 9 cents per kWh to ensure that investors can recoup their investment capital.

Especially, these investors should be subject to tax exemptions in order to prop up their investments. Large companies active in electricity, oil, gas, coal and mineral sectors should also be assigned particular targets for developing these clean energy sources.

For more information on investment opportunities in Vietnam, visit our homepage

Source: The Saigon Times

Vietnam Renewable Energy development project to 2030 with outlook to 2050

1. Viewpoints, strategies and development goals 

Viewpoints on development 

- RE development shall be in synergy with the realization of economic, social and environment goals - RE development and use shall be concerted with an expansion of RE industry
- Focus shall be given to proven technologies in the RE field (including hydropower, wind power, solar power, biomass energy and biogas)
- Incentives/support policies shall be matched with the market mechanism
- Restructuring and state management capacity building shall come together in the RE field.

Strategic and development goals 

 Encourage/mobilize all resources from the society , develop RE with reasonable prices, gradually increase the RE share in the national energy production and consumption in order to ensure less dependence on fossil sources, and contribute to better energy security, mitigating climate change, environmental protection and sustainable socio-economic development.

Renewable Energy in Vietnam

In spite of Vietnam´s current dependency on fossil fuels and coal, the Vietnamese government actively supports renewable energy, and the sector is thereby becoming increasingly interesting for Dutch companies and organisations. While realising the challenges, business opportunities can be found in biomass, wind and solar energy.

With a population of over 90 million people, Vietnam has the third largest population in Southeast Asia after Indonesia and the Philippines. Since the mid-eighties, the country has transitioned from the rigidities of a centrally planned economy into one of Asia’s fastest growing emerging markets. It reached lower middle income status in 2010 and is a member of WTO and regional forums, including the Association of Southeast Asian Nations (ASEAN). After several years of lower economic growth, Vietnam’s economy is gaining momentum again and is expected to grow by 6-7% annually in the upcoming years. Currently, the country has negotiated several Free Trade Agreements (FTAs), including one with the EU that is expected to be in place in 2018.

Due to both rapid industrialisation and remarkable economic growth, domestic energy consumption levels have increased with almost double the speed of Vietnam´s already high GDP growth levels, growing on average by approximately 12% per year between 2006 and 2016. Diffrent estimations of energy demand in Vietnam vary from increasing threefold to eightfold from 2015 to 2030.

According to the Boston Consulting Group, Vietnam’s middle and affluent class will double in size between 2014 and 2020, from 12 million to 33 million. By 2020, Vietnam’s average per capital income will rise from USD 1,400 to USD 3,400 a year.

Vietnam Conglomerate Plans $1 Billion Solar Parks Project

Vietnam’s TTC Group, a sugar, energy, real estate and tourism conglomerate, is planning to spend as much as $1 billion on an ambitious plan to build one of the country’s largest portfolios of solar projects in an effort to capitalize on the nation’s growing power needs.
“Solar energy is very hot right now as the recent pricing set by the government is reasonable, development costs are much cheaper and coal-fired power plants have caused so many concerns," CEO Thai Van Chuyen said in an interview at the company’s headquarters. “Vietnam always needs more power every year for its expanding economy."

The Ho Chi Minh City-based company is looking for new investors for 10 to 20 solar parks it expects to have in operation by 2018, Chuyen said. The company, which will fund 30 percent of the project, is in talks with banks and financial institutions for the remainder of the funds needed for the parks, which would account for total capacity of as much as 1,000 MW, he said.

TTC’s interest in solar marks an expansion into clean energy in a country that relies on hydropower for most of its renewable capacity. Vietnam is also facing a power gap. The country will need to invest $74 billion in coal, gas, wind, solar and hydro power plants through 2025 as power demand doubles, Bloomberg New Energy Finance wrote in a report in March.

Vietnam’s vision for a renewable energy future

In recent decades, Vietnam’s demand for energy has increased along with its rapid economic development. This surge in demand could provide the impetus to develop Vietnam’s emerging renewable energy industry.

Vietnam’s GDP grew at an annual rate of 6.8 per cent between 1990 and 2013, and is projected to hover around 7 per cent annually from 2016 to 2030. Industrialisation, coupled with population increases, drives the need for more energy and especially more electricity. This is evident in the increase of final energy consumption at an average annual rate of 5.7 per cent between 1990 and 2012, and of electricity use at 14 per cent annually during the same period.

To meet increasing power demand, Vietnam’s Power Master Plan VII projects its output will need to increase to 194–210 billion kilowatt hours (kWh) in 2015, to 330–362 billion kWh in 2020, and to 695–834 billion kWh in 2030. As renewable sources are part of Vietnam’s energy mix, surging power demand will also boost the demand for renewable energy.

In comparison to other more traditional energy sources such as oil and coal, renewable energy is relatively new in Vietnam. Its presence is strongly driven by government policies, and is mostly positioned within sustainable development and greenhouse gas (GHG) reduction frameworks.

The Sustainable Development Strategy 2011–2020, for example, identifies clean and renewable energy development and its growing share in Vietnam’s energy consumption mix as priorities for a sustainable economy. The National Strategy on Climate Change also highlights the development of ‘new and recycled energies including wind power, solar energy, tidal energy, geothermal energy, biofuel and universal energy’ as avenues to reduce greenhouse gas emissions. Similarly, the National Action Plan on Green Growth 2014–2020 explicitly mentions the need to promote clean and renewable energy to reduce GHG emissions.