Out-Law / Your Daily Need-To-Know

Vietnam’s offshore wind power capacity to reach 36GW by 2045

Out-Law News | 29 Nov 2021 | 6:25 am |

Vietnam will increase its offshore wind power capacity to 36 gigawatts (GW) by 2045.

The figure has been updated in Vietnam’s latest draft Power Development Master Plan VIII, according to a local report.

Yeap John

John Yeap

Consultant

In order to deliver on those gigawatts, investors will therefore be looking for much more robustness and certainty on the regulations for the sector, together with the required investment in the transmission and distribution network.

Renewables expert John Yeap at Pinsent Masons said: “Vietnam’s offshore wind ambition is truly impressive, potentially making it one of the largest offshore wind nations globally, alongside the likes of the UK and China.”

“However, the challenges it faces are also significant, ranging from its current regulatory framework and financing capacity, and including supply chain and fabrication issues. The grid will also have to be upgraded to enable the absorption of such a significant increase in non-firm generation,” he said.   

“In order to deliver on those gigawatts, investors will therefore be looking for much more robustness and certainty on the regulations for the sector, together with the required investment in the transmission and distribution network,” Yeap said.

Offshore wind farm turbines on the ocean

According to the World Bank (WB)’s Offshore Wind Roadmap for Vietnam (216-page, 6.11MB PDF), Vietnam can have an offshore wind power capacity of 10GW by 2030, generating around US$6.5 billion in gross value added annually for the country by then.

Vietnam will have to invest US$6.7bn in the first 4-5 GW of offshore power wind capacity, as the GWEC calculated.

According to the Global Offshore Wind Report 2021 (136-page, 20.2MB PDF) which was published in September, over 1.5GW of offshore wind projects are under construction in Vietnam currently, of which 1.2 GW are expected to come online before the end of November, when the current feed-in tariff regime expires. The report also predicts that new installations are expected to fall from 2022, but the country’s offshore wind market is likely to bounce back once its government confirms the offshore target in PDPVIII.

Vietnam released its draft PDPVIII in April.  The country originally planned planned to increase wind energy production from 600 megawatts (MW) in 2020 to over 11GW – 12GW in 2030. 35 potential offshore wind projects are included in the plan.