Vietnam’s Power Development Plan for the Period 2021-2030, with a Vision to 2050 (Power Plan 8) sets ambitious targets for offshore wind and gas-fired power generation. By 2030, the country aims to have approximately 6,000 MW of offshore wind capacity to meet domestic electricity demand, with a further increase to 70,000-91,500 MW by 2050. For gas-fired power, the total capacity of projects to be invested in and operated by 2030 is 30,424 MW, transitioning to hydrogen by 2050. The additional capacity from these two energy sources is expected to account for about 50% of the total capacity required, playing a crucial role in supplying electricity to the national grid.
To accelerate the development of gas-fired and offshore wind power, and to contribute to Vietnam’s commitment to achieving net-zero emissions by 2050, the government has issued Decision 1009/QD-TTg dated August 31, 2023, on the Project for Implementing the Political Declaration on Establishing a Fair Transition Partnership (JETP) and Decision 165/QD-TTg dated February 7, 2024, on the Vietnam Hydrogen Energy Development Strategy for the Period to 2030, with a Vision to 2050.
CHALLENGES AHEAD
At the recent workshop on “Promoting the Development of Green Energy: Status and Solutions,” Dr. Nguyen Quoc Thap, Chairman of the Vietnam Oil and Gas Association, assessed the actual investment and construction situation. He mentioned that the O Mon Thermal Power Plant I is now operational but still runs on oil and awaits gas supply from the Lot B Gas Project to transition to gas-fired power generation.
Additionally, the Nhon Trach 3 and 4 gas-fired power plants, with a capacity of 1,624 MW, are under construction and have reached 85% completion. They are expected to begin trial operations by the end of 2024. Vietnam plans to implement 18 gas-fired power projects, with nine projects using domestically sourced gas and nine projects utilizing LNG. The total expected additional capacity from these projects is 16,400 MW.
While offshore wind power has been planned to reach a capacity of 6,000 MW by 2030, there is currently only one project that has been granted permission by the Prime Minister for parameter measurement studies. According to Dr. Vo Tri Thanh, Director of the Institute for Brand and Competition Strategy, the energy transition outlined in Power Plan 8 is crucial for achieving Vietnam’s green transition and net-zero commitments.
Despite some progress, experts acknowledge that challenges remain in realizing the goals for gas-fired and offshore wind power development. The first challenge pertains to the structure and technology of Vietnam’s energy sector. Transitioning from coal-fired power to gas-fired power requires a shift in the structure of the country’s power industry within a limited timeframe to meet the government’s targets. However, time is of the essence, and the projects that have already been constructed or are under construction account for only a small portion of the planned capacity.
This article was published in the Vietnam Economic Magazine, Issue 33-2024, released on August 12, 2024. To read the full article, please visit: https://postenp.phaha.vn/chi-tiet-toa-soan/tap-chi-kinh-te-viet-nam
