The untapped potential of renewable energy in Vietnam

Positive power of water

According to the government’s goals, to meet the surging demand for power resulting from urbanization and industrialization, the power sector must generate 265 billion kWh of electricity by 2020 and 570 billion kWh of electricity by 2030. The country currently produces more than 170 billion kWh of commercial electricity, mostly from fossil energy sources, such as coal and gas, but these are being increasingly exhausted.

Small and medium-sized hydropower is considered the most feasible renewable energy source. Tran Viet Ngai, chairman of the Vietnam Energy Association (VEA), has proposed that the National Assembly and the government reconsider the decision to cancel construction of 400 planned small and medium-sized hydropower projects and allow investment in them to resume. The projects were scrapped from the hydropower development program after it transpired that many of the hydropower plants built in the 2010-2014 period had negatively affected their forest environment. However, according to Tran Viet Ngai, over 300 small and medium-sized hydropower projects have been built with total capacity of more than 3,000 MW, which provide 10 billion kWh of electricity to the national grid every year.

He emphasized that many of these projects are operating in a stable way, while forests have been replanted and local residents have been effectively resettled and resumed their lives. Small and medium-sized hydropower plants can also greatly benefit local economies and help ease electricity shortages. However, these must be projects with high economic efficiency and high capacity (over 30 MW). The projects would be useful as they can provide electricity to remote areas, thus easing the overload on the national grid. According to Tran Viet Ngai, if 300-400 additional small and medium-sized hydropower plants were built, they would add total capacity of 3,000-4,000 MW, or 15 billion kWh of electricity.

Many localities throughout the country have been implementing small and medium-sized hydropower projects. For example, Lao Cai People’s Committee allowed investors to conduct a survey of 10 hydropower locations, while Quang Nam Province plans 32 small and medium-sized hydropower plants.

Wind and solar potential

At the Vietnam Technology and Energy Forum 2017 organized by the Ministry of Science and Technology, Dr. Nguyen Anh Tuan from the Ministry of Industry and Trade’s Energy Institute said Vietnam’s renewable energy potential is massive, including wind and solar power. However renewable energy development has not been commensurate with potential. Total capacity of Vietnam’s existing wind power farms has just reached 159MW, while total installed solar capacity for power generation is only about 6MW. As of July 2017, some 250 wind, solar and biomass development projects were registered with a total capacity of nearly 25,000MW.

Vietnam has set a target to increase solar photovoltaic capacity to 12,000MW by 2030. According to experts, this goal could be attainable thanks to Vietnam’s great advantages such as large solar radiation, low production costs and the government’s interests in renewable energy development. Decision 11/2017/QD-TTg on the mechanism for encouraging the development of solar power projects in Vietnam was passed in April 2017, creating a wave of investment in solar power development. In addition, Vietnam Electricity (EVN) is investing in nearly 20 solar power projects with a total installed capacity of 2,000MW in the provinces of Khanh Hoa, Kon Tum, Ninh Thuan, Binh Thuan and Dong Nai.

The government also approved a decision on the mechanism supporting the development of wind power projects in Vietnam. According to the decision, the electricity buyer will be responsible for purchasing all electricity output from wind power projects at the point of delivery. In addition, the Ministry of Industry and Trade has cooperated with the World Bank (WB), German Agency for International Cooperation (GIZ) and German Bank for Reconstruction (KfW) to conduct wind measurement at 30 points nationwide to develop a database and wind map for Vietnam.