Vietnam gets much more momentum for solar, wind energy

How do you assess Vietnam’s renewable energy development? Can Vietnam catch up with other Southeast Asian countries in terms of renewable energy?

Two years ago, there was a very strong development in Thailand which has now slowed down by a combination of less financing being available and unfavorable regulatory regime. So, I think when I compare it to two years ago, Vietnam is getting much more momentum for solar and wind energy.

With over four GW, Vietnam has installed more solar capacity than most countries in Southeast Asia, and Vietnam has more potential for wind power, including onshore, nearshore and, in the long term, offshore wind, given the coast and the quality of the wind. I would say Vietnam has done more solar energy than any other country I can think about in the region, and Vietnam probably has the largest potential of wind in the region, due to the quality of human resources, the availability of local financing, and the interest of financing from outside Vietnam.

So now, so far, I would say, during the last year for wind we have seen the pace of active installation, moving in a way which is consistent with the potential. I think if we want to move to bigger activities, it has to happen in the next two years because the feed-in tariff window is expiring until the end of 2021, so it has to happen in the two years that we have ahead of us. We will see some concerns related to the planning process which could hinder us a little bit, but if the project starts in the next six months then Vietnam will be the largest market for wind in the region.

The uncertainty is still related to the planning process and the speed of it - the master plan process and the speed of the approvals of the project. I think Vietnam has done more solar energy than any country in the region and can do more wind than any country in the region.

Vietnam is having 66 wind farms registered with the Ministry of Industry and Trade and 231 solar farms of which 90 percent go into operation. Among these projects, how many turbines are provided by GE?

We are not so active in solar energy in Vietnam; we have done two projects of 50 MW each, which is a small part of the market. In wind, today we have 30 percent of the market share locally in Vietnam. Out of the pipeline you mentioned, the vast majority of these pipeline projects have not yet selected their turbine suppliers.

So, we are working with many of them. We have been selected already for a few projects with our new Cypress turbines but for the majority of the 66 projects, the customer is still in the process of selecting the turbine. I think naturally in Vietnam, like in many countries of the world, GE should have market share between 25-30 percent, so that’s our target.

Is the 30-percent figure you mentioned about projects in operation?

They are projects both in operation and under construction.

It seems that GE gives priority to wind rather than solar energy in Vietnam. Why don’t you focus on solar power which is also hugely potential here?

First, historically in renewable energy in Vietnam there is a very strong activity in the hydro business. We have been the supplier for hydro projects like Son La, Lai Chau in the past 10 years.

Second, today GE globally, has much bigger activities in wind than in solar. We are in the top three producers of wind turbine in the world, and we want to be in the top three in Vietnam and hopefully the leader in the market. Solar for GE is a smaller activity because we don’t produce solar panels and we don’t intend to. So, we focus on the part of the scope of solar project, which is the electrical components, which has everything to do with conductors, transformers and the electrical part for the solar project. We don’t do the panels because there is not much value for a company like GE to be active in that segment.

So, again, in Vietnam, it is no different in what we do compare to what we do in the world. Very traditional activity, the hydro. Very big in wind which is a priority. Small activity is solar because we operate where we think we can give value to our customers and that is much more the case with wind than solar. Wind is more technical, and we can leverage better.

What is your evaluation on this price (lower, high or need to be change)?

Countries manage to increase substantially the part of delivery to the grid without significant impact on the cost of electricity because today renewable cost is competitive with fossil fuels in many countries, if not most countries in the world. Scale has been created, and technology has improved. Renewable is cheaper than most fossil fuels in most areas of the world. There might be, in Vietnam, that adjustment cost in the beginning but in the long run there is no reason why renewable energy would result in higher costs of electricity.