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Sustainable Energy Projects Face Hurdles As Vietnam Plans More Coal Plants

While Vietnam holds great potential for reneweable energy sources like solar and wind, a lack of supportive regulations has made it difficult for sustainable energy projects to get off the ground. Meanwhile, the use of polluting coal plants is set to increase. 

According to Tuoi Tre, the government has created a plan to transform the south-central provinces of Ninh Thuan and Binh Thuan into wind and solar energy hubs by 2020. Specifically, Ninh Thuan hopes to provide 5-8% of the country's electricity by that year, but thus far little progress has been made towards that goal.

The news source reports that the provinical People's Committee had only attracted 13 wind power projects as of July, and only two of those projects have broken ground. 

One of the biggest obstacles facing wind power investment is the low selling price of wind energy in Vietnam. Such electricy currently sells for just 7.8 cents/kilowatt-hour (kWh), says Tuoi Tre. This is compared to countries like Germany at 12.3 cents/kWh, Japan at 29 cents and Thailand at 20 cents. This deters energy companies from bankrolling wind projects as it will take longer for them to recoup their investment. Do Minh Kinh, director of the Binh Thuan Province Department of Industry and Trade, has asked the central government to adjust the price to over 9.6 cents/kWh.

Despite this handicap, major corporations are interested in Vietnam's wind power potential. Late last month, General Electric announced a US$1.5 billion partnership with Ireland-based Mainstream Renewable Power Ltd. to develop large-scale wind power plants in the country, reports the Wall Street Journal. The paper quoted Mainstream Renewable CEO Andy Kinsella as saying: "Vietnam is going to be a huge importer of energy. There's huge demand for power and they can balance the equation with renewables."

Construction on the project is expected to begin in 2018 and will eventually add 1 gigawatt to Vietnam's overall energy capacity. 

Solar projects face an even greater struggle, as there is no official price for solar-generated electricity in Vietnam, a country which receives similar amounts of solar-generated energy as Spain and Italy. This makes it very difficult for companies to plan out the financial costs of investing in solar. Additionally, Ninh Thuan doesn't even have a solar framework in place, according to Tuoi Tre. Pham Van Hau, vice chairman of the provincial People's Committee, told the news source that such a plan is expected to be drafted by the end of this month.

Such renewable struggles come at a pivotal moment for Vietnam's energy industry. The country is set to dramatically increase its number of coal-fired power plants over the next decade, from the current 19 to 51 by 2030. This is in stark contrast to global trends. Tuoi Tre cites figures from GreenID, a nonprofit, stating that Europe has closed 109 coal plants in recent years, while the US has denied permits to 179 new projects and closed 165 more. Even China, notorious for its pollution, has banned new coal plants around Beijing, Shanghai and Guangzhou.

Vietnam needs more power, especially its southern regions, but coal-fired power plants contribute to air pollution, a major health concern in the region

[Photo via Dinosaurcv]


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Vietnam Must Invest in Renewable Resources to Solve Energy Crisis: Experts

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UNDP Urges Greener Aviation Industry in Vietnam


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