Vietnam seeks international support to meet COP26 energy commitments

Out-Law News | 03 Mar 2022 | 4:01 am | 1 min. read

Vietnam will need international concessional capital support if it is to ensure energy security and reach its net zero emissions target by 2050, its industry and trade minister, Nguyen Hong Dien, has said.

The Ministry of Industry and Trade (MoIT) has been working to update its draft Power Development Plan VIII (PDPVIII) to reduce coal-fired power generation and develop gas-fired power generation, especially liquefied natural gas (LNG), according to a news release by the Vietnam’s government.

Nguyen Hong Dien said this during a meeting in February with British Minister Alok Kumar Sharma, president for the 26th United Nations Climate Change Conference (COP26). Sharma suggested mobilising funds from public and private sources to invest in green infrastructure projects to meet the commitments which Vietnam made at the UN conference.

Last week, Vietnam’s deputy prime minister Thanh said the solar capacity planned in the PDPVIII for the 2021-2030 period with vision until 2045 was "too high", and should be reduced to make some space for offshore wind power. The MoIT said solar power would account for 25% of total electricity generation in the 2031-2045 period.

Hong Kong-based renewables expert John Yeap at Pinsent Masons said: “The market is eagerly awaiting the finalisation of PDPVIII so as to provide the sector with a clear road map on the future direction of the electricity industry in Vietnam. It is not surprising that the plan is being revised to reduce the amount of coal capacity, though the use of gas as a transition fuel will likely to be unavoidable given the projected growth in demand.” 

“Vietnam has significant off and near shore wind capacity, and a clear road map on the development of this sector will greatly propel Vietnam’s ambitions to be a regional leader in offshore wind. Meeting the net zero commitment will likely involve a combination of decarbonising older coal plants, utilising gas as a transition fuel, and emphasizing the country’s abundance renewable energy sources, such as solar and wind,” he said.

Vietnam published the first draft of PDPVIII in 2021.