Revised power plan: more renewable energy

The deputy PM reaffirmed the heavy and challenging tasks for the country’s power industry after a meeting earlier this week with Electricity of Vietnam (EVN) about implementing the adjustments to the 7th Vietnam Power Development Planning (PDP7) in the period 2011-20 with an outlook to 2030.

The adjustments to PDP7 approved in March, 2016 replace a plan issued in 2011.

Under the adjusted planning, Vietnam’s power industry is expected to meet socio-economic development objectives with an average yearly GDP growth of 7% during the period 2016-30, 1.5% lower than the GDP forecast in the original PDP 7.

The lower projections of economic growth reduce the demand for total electricity generation by about 20% and 18% by 2020 and 2030, respectively.

As a consequence, the total power installed capacity of Vietnam in the adjustment would reach only 265GW by 2020 and 572GW by 2030, compared to 330GW and 695GW in the original PDP7.

Early this year, former Prime Minister Nguyen Tan Dung said the adjusted planning was needed to adapt to changing circumstances and make Vietnam’s climate change mitigation policies compatible with objectives of green house gas reduction to which Vietnam committed within the UN Framework Convention on Climate Change in Paris last year.

Less coal-fired power

The adjusted power development planning emphasises the reduction of coal-fired power, the increase of renewable power and the availability of nuclear power in Vietnam, said Nguyen Anh Tuan, Deputy Head of the Ministry of Industry and Trade (MoIT)’s Institute of Energy.

Accordingly, by 2020, coal-fired power will account for 42.7% of all energy sources, about 5.3% lower than stipulated in the original PDP7. Nonetheless, given the need to generate more power, the percentage of coal-fired power will be significantly higher than the current 33.4%.

Last year, the commercial electricity output reached 143.34 billion kWh but 2020 output is targeted to reach 245 billion kWh.

Renewable power would account for 9.9% instead of 5.6% as stated in original PDP7.

Vietnam’s first nuclear power plant is expected to go into operation in 2028. By 2030, the nuclear power capacity could reach 4.6GW with electricity generation of 32.5 TWh per year, accounting for 5.7% of total generation mix.

Tuan told the Điện lực (Power) magazine that currently, the Government has empowered the Vietnam National Coal and Mineral Industries Group (Vinacomin) as main contact in importing coal.

“Other investors could actively import coal if their imported product meets requirements in quality, prices and of course, with approval from authorised agencies,” he said.

He said the adjusted planning also revealed the need to develop groups of ports for coal transport near coal-fired power plants in order to minimise transportation costs.

The adjusted planning includes measures to mitigate impact of power generation on the environment. For examples, waste from coal-fired power plants could be used to make building materials or serve other industries. Environment-friendly technologies are encouraged.

Deputy PM Trinh Dinh Dung said that Vietnam continues to seek investors for power projects, not only from State-owned corporations like EVN, PetroVietnam and Vinacomin - but also private or foreign investors.

He asked the Ministry of Planning and Investment to design policies to attract investors as well as to use overseas development assistance effectively in power projects.

The EVN has suggested that investors in power projects be allowed to import coal.

The major power supplier in Vietnam called for a mechanism to control the process of power-producing projects, including those with Build-Operate-Transfer contracts.

Dung asked the MoIT to develop and issue sanctions to investors for falling behind schedule.