Following the Brief Report on the review of the Power Development Plan VIII (PDP8) on 25 April 2023, the Ministry of Industry and Trade of Vietnam (MOIT) officially delivered Report No. 2575/TTr-BCT dated 2 May 2023 (Report) to the Appraisal Council for its final approval. The notable points of the Report are as follows:
Overall goal
Generally, the primary goal of the PDP8 is to ensure that, until 2050, Vietnam has adequate access to reliable, high-quality power at a reasonable price. This goal, under the Report, is set to be achieved by optimizing power sources, upgrading the system for distribution of electricity, promoting the use of renewable energies and exporting of power, and utilizing the cutting-edge technologies into the power systems.
Specific goals
According to the Report, by 2030, the planned energy resource for local consumption shall reach 158,244 MW consisting of: (i) Hydro energy: 18.5% (29,346MW); (ii) Coal power: 19% (30,127MW), (iii) Domestic gas: 9.4% (14,930MW); (iv) LNG: 14.2% (22,400MW); (v) onshore wind power 13.8% (21,880MW); (vi) offshore wind power 3.8% (21,880MW); (vii) solar power 13% (20,591MW); (viii) biomass and WTE 1.4% (2,270MW), (ix) storage battery energy around 2% (around 3,000MW) and (x) foreign imported power 3.2% (5,000MW). Meanwhile, the capacity for exporting is 3,000 – 4,000 MW.
Hydropower, onshore and offshore wind power, self-consumption wind and solar energy are all encouraged for growth in the energy sector. With the prolongation of the schedule for LNG Long Son (1,500 MW), the coal power projects are restricted for those projects subject to PDP7, and the development of LNG power is constrained. As for ground mount solar power, the DPPA pilot is accepted for an approximately 1000MW solar system and 12 projects with a combined capacity of 1,634 MW that are in the licensing process for execution beyond 2030 are postponed. On another hand, rooftop solar energy is promoted for the personal use, rather than the use for the national grid.
Investment figure
The total investment for the development of energy plans for the years 2021 to 2030 is approximately USD 134.7 billion, which includes (i) the cost of the energy source investment, which is approximately USD 119.8 billion (with an annual investment of approximately USD 12 billion), and (ii) the cost of the transmission grid investment, which is approximately USD 15 billion (with an annual investment of approximately USD 1.5 billion).
PDP8 – When will it be issued?
As per recent consultations with the MOIT and other competent authorities, it is expected that the PDP8 will be issued soon, and the issuance date could be within this year. According to some optimistic sources, the issuance may even be this May.
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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com or any other lawyer listed in our office list if you have any questions on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.