Renewable energy offers investment opportunities in Vietnam

Vietnam’s target of raising renewable electricity to 45% of the national power generation capacity by 2030 and the need for investment worth up to US$14 billion towards this goal have created substantial opportunities for both domestic and foreign firms.

The Ministry of Industry and Trade (MoIT) has estimated that the annual domestic power consumption would grow at 9% to keep up with the rapid economic development.

Over the past time, Vietnam had imported coal and will have to buy liquefied natural gas (LNG) in the time ahead to meet the rapid rise in demand, the ministry said.

Hoang Tien Dung, head of the Electricity and Renewable Energy Authority under the MoIT, noted that it is a hard task to ensure energy security and achieve the target of net zero emissions by 2050 as Vietnam committed at the 26th United Nations Climate Change Conference (COP26).

At a recent Vietnam-US Business Summit in Hanoi, Dung said Vietnam has set a target that by 2030, renewable electricity will account for 45% of the national power generation capacity, reflecting its orientation towards renewable energy.

The implementation of the power source and grid development programme will cost an estimated US$14 billion, so Vietnam needs the participation of businesses, especially those from the US, in resources and technology sharing.

Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Pham Tan Cong, said Vietnam gives high priority to sustainable energy development to maintain national energy security and reduce greenhouse gas emissions.

The VCCI has introduced its Green Index initiative with support from the United States Agency for International Development (USAID), aiming to promote environmental institutional reform and environmentally-friendly investment activities.

Cong said he believes that Vietnamese and US enterprises have good chances for successful cooperation in liquefied natural gas, and clean and renewable energy in contribution to the countries’ trade growth and energy security.

Ken Haig, Head of Energy and Environment Policy for Asia-Pacific & Japan at Amazon Web Services (AWS), said to boost investment attraction in the sector, Vietnam needs a long-term strategy.

He also expressed his support for increasing the use of solar and offshore wind power and hoped the US’s investment in renewable energy in Vietnam will contribute to the nation’s sustainable development in the time to come.

At the recent Vietnam Business Forum, representatives from many domestic and foreign business associations operating in Vietnam suggested the government continue to develop renewable energy, improve energy efficiency, and promote battery and hydrogen-based energy storage.

Foreign investors held that Vietnam should consider renewable energy trends and opportunities to complete its Power Development Plan VIII and other power planning schemes, as well as implementation mechanisms.

Regarding wind power, many foreign business associations suggested the country set out clear regulations for wind farms that are under construction and fail to meet the deadline due to the COVID-19 pandemic, helping them benefit from the  FIT price mechanism.