Vietnam needs additional US$368 billion to achieve net zero emissions

The energy industry has a crucial role to play in achieving net zero emissions by 2050, therefore it requires a structural transition towards green growth and the nation needs assistance from developed countries regarding both financial and technical issues.

In terms of the details of the national green growth strategy, the Prime Minister adopted the national action plan on July 22 regarding green growth for 2021 to 2030, with the plan featuring four important goals. The goals are to reduce greenhouse gas emissions per GDP, to create green economic sectors, to promote green lifestyles and sustainable consumption, and to transition on the principles of equality, inclusion, and resilience.

Upon addressing the conference relating to the impact of COP26 on the energy transition towards green growth launched on August 17, Deputy Minister of the Ministry of Planning and Investment Nguyen Thi Bich Ngoc said that resources are the biggest problem in meeting the goals. A lack of resources makes it challenge to move towards the net zero emissions target by 2050.

In relation to the plan, the building resilience process alone will account for roughly two-thirds of this amount as a significant amount of capital must be mobilised to protect assets and infrastructure, as well as vulnerable populations.

Furthermore, the cost of the decarbonisation roadmap is mainly derived from the energy sector, including the expense of investing in renewable energy and managing the transition away from coal, a move which could cost about US$64 billion during the 2022 to 2040 period.

"Thanks to the fast growth of renewable energy and fuel swap of thermal power plants, the CO2 emissions of the power development plan revision after COP26 have decreased sharply," said Hoang Tien Dung, director of the Electricity and Renewable Energy Department under the Ministry of Industry and Trade (MoIT).

CO2 emissions are due to peak between 2031 and 2035 at 231 million tonnes, then decline gradually. By 2045, CO2 emissions are set to fall to roughly 175 million tonnes, which means a 208 million tonnes of CO2 reduction compared to pre-COP26 alternatives. By 2050, it is estimated that CO2 emissions from the power generation sector will be at some 40 million tonnes per year, thereby helping the country to meet its commitment at COP26 of net zero emissions by 2050.

Whilst attending the event, Deputy Minister Dang Hoang An said that the energy transition is not only an internal issue of the energy sector, but represents a challenge for the transition of the whole economy from an energy-intensive model to one that is energy-efficient.

Electricity and energy demand will continue to grow along with the industrialisation and modernisation of the country’s economy in the future, calculations made by the MoIT showed, with it being tough to meet the growth rate.

Therefore, the most important mission is to develop a suitable, feasible, and sustainable strategy. “I would like to stress the importance and urgency of cooperation in research and development of energy science and technology on a global scale, especially technology for large-scale power generation from new primary sources such as hydrogen, ammonia, advanced energy storage technology, and CO2 absorption and storage technology,” Deputy Minister An said, adding that it is necessary to raise awareness of the urgency of economical and efficient use of energy in all economic sectors.

Moreover, Deputy Minister Ngoc also proposed five ideas related to future energy transitions. The first is to carefully calculate the roadmap for the green and sustainable transition in a bid to ensure national energy security.

Secondly, during the transition process, it can be considered necessary to reduce its impact on vulnerable groups, especially the effect of higher electricity bills on poor households and the transfer or job loss of workers in industries and fields, including fossil energy to renewable energy.

Thirdly, all parties involved in the transition must be responsible for it. Fourthly, finalising the transition requires the support of finance and technology from developed countries.

Finally, during the process of implementing the energy transition, it remains essential to effectively conduct an assessment, inspection, supervision, and related sanctions in a bid to limit and reduce investment, create alternatives, and close polluting production facilities and high-carbon infrastructure.