Vietnam – Power Development Master Plan 8 – what you must know:

In late March 2021, the very first draft of the Prime Minister’s Decision on the Approval of National Power Development Planning VIII (“Draft PM Decision”) has been published through unofficial sources (i.e. not through MOIT’s website). This means the final draft PM Decision may be amended and updated, nevertheless this is very likely issued by a contact of MOIT.

The Draft PM Decision states clearly that priority is given to the development of renewable energy sources for electricity production. In particular, the Draft aims to increase the rate of electricity produced from renewable energy sources (not including hydroelectric sources greater than 30 MW, storage hydroelectricity) to about 32% in 2030 and 43% in 2045.

By 2030, it is estimated that the total capacity of all power plants will be about 138,000 MW, of which: large, medium and pumped hydropower accounts for 15.2%; coal thermal power 27.1%; thermo-gas (including LNG) 19.9%; renewable energy sources (including small hydroelectricity, wind power, solar power, biomass power, …) accounts for 32.5%; electricity import is about 4.1%
Electricity produced and imported to reach 551 billion kWh, of which: large, medium and storage hydropower accounts for 13.5%; coal thermal power is about 41.15%; gas thermal power (including LNG) 22.58%; renewable energy sources (including wind power, solar power, biomass power …) 18.73%; electricity import 3.83%.

While the PDP 8 is being finalized, the Draft PM instructs investors and relevant government agencies to continue the implementation of renewable energy projects (wind power, solar power) that were approved in the Revised Power Development Planning 7 and other specialized electricity planning.

Notable provisions of the Draft:

Investment Capital:
The total investment capital required to implement the PDP 8 from 2021-2030 is about USD 128.3 billion, of which USD 95.4 billion to be used for power source development while USD 32.9 billion to be invested in grid construction and management. The total investment capital is calculated to reach USD 192.3 billion by 2045.

Wind power:
Raise the total capacity of onshore wind power projects to about 18,010 MW-23,080 MW in 2030 and about 60,610-76,680 MW by 2045.

For offshore wind power projects, the target capacity is 5000 MW or more by 2030 and 21,000-36,000 MW by 2045.

Total electricity produced from wind power projects is expected to account for 7.9% in 2025, about 8.1% in 2030 and about 19.2% in 2045.

Solar energy:
Encourage the development of solar power sources, including onshore, water surface as well as rooftop systems.

The total power capacity to be about 17,240 MW in 2025, roughly 18,140 MW in 2030 and 40,090 MW by 2040. Electricity produced from solar power is expected to reach around 7.3%. In 2025, about 5.3% in 2030 and 8.9% in 2045.

Hydropower sources:
The total capacity of small hydropower sources is targeted to reach 4,800 MW in 2025, about 5,000 MW in 2030 and nearly 6,000 MW in 2045.

Thermal power:
For thermal power plants using domestically exploited gas and liquefied natural gas (LNG):

By 2030, the total capacity will reach 27,000 MW, production to hit 124 billion kWh, accounting for nearly 23% of the total electricity output.

In 2045, the total capacity to reach 51,000 MW while production achieves 253 billion kWh, accounting for nearly 26% of the total electricity output.

The Government also promote the development of port storage systems, infrastructure for LNG import in regions across the country to fuel power projects using LNG.

List of projects of national importance and prioritized for development under the Draft PM Decision:

List of projects of national importance and prioritized for development under the Draft PM Decision

For more information, please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC, Member to the Supervisory Board of PetroVietnam Insurance JSC and the only foreign lawyer presenting in Vietnamese language to members of the NATIONAL ASSEMBLY OF VIETNAM.