Vietnam, the 8th Power Plan (PDP 8) is released!
Introduction: Vietnam regularly publishes the National Power Development Plan (PDP) to formulate power development goals for the next ten years. In March 2021, the Ministry of Industry and Trade (MOIT) of Vietnam submitted the “National Power Development Plan Proposal for 2021-2030 to 2045” for the first time to the Prime Minister of Vietnam, namely the Eighth Power Development Plan (hereinafter referred to as PDP 8). During this period, the Vietnamese government held several meetings to review the draft PDP 8 and make detailed adjustments, but it has not yet received final approval. Yesterday, PDP 8 was officially launched.
On May 15, Vietnam’s Deputy Prime Minister Tran Hong Ha signed Resolution No. 500, officially approving the “National Power Development Plan 2021-2030 towards 2050” (PDP 8), marking the official implementation of the nearly four-year draft plan.
- Improve power generation capacity and ensure power supply
According to the plan, Vietnam will enhance its power generation capacity, planning to increase it from 69GW in 2020 to 158GW in 2030, an increase of more than double. Among them, domestically produced natural gas and imported liquefied natural gas will become the main sources of power generation, totaling approximately 37.33GW, accounting for 23.6%. In addition, coal will still account for 19% of the energy structure, followed by hydropower at 18.5%; wind power at 17.6%; and photovoltaics at 13%.
- Upgrade the power grid and enhance consumption capacity
According to the Ministry of Industry and Trade, due to insufficient power grid consumption, the development of approximately 3,600MW and 3,000MW thermal power projects in the south and north respectively has been blocked, causing these two regions to face serious power shortages. In addition, as of 2020, Vietnam’s photovoltaic capacity has reached 8,700MW, exceeding 9 times the current capacity of the power grid. Therefore, in the new power plan, Vietnam plans to develop high-voltage systems of 220kV and above.
- Prioritize the development of renewable energy
According to Vietnam’s commitments under the framework of the Just Energy Transition Partnership (JETP), the country’s share of renewable energy in domestic power generation is expected to increase to 67.5%-71.5% by 2050. PDP 8 continues to strongly support the development of renewable energy and plans to add approximately 21,880MW of onshore wind power, 6,000MW of offshore wind power projects, 12,836MW of photovoltaic projects and 300MW of energy storage projects by 2030. The Ministry of Industry and Trade emphasized in its statement that by 2030, Vietnam will install photovoltaics on half of office building and residential roofs (for self-use only).
- Build a renewable energy ecosystem
Vietnam will also build two cross-regional renewable energy service and industrial centers in areas with great potential such as the north, central-south or south, including power production, transmission and consumption services; renewable energy equipment manufacturing and installation services, to build a renewable energy industry. Renewable energy industry ecosystem. In addition, PDP 8 plans to produce 5GW of renewable energy power and export it to other countries.
As for funds, according to the plan, Vietnam needs US$134.7 billion in development funds. 90% of it will be used to develop electricity, and the remainder will be used to improve basic power facilities. The introduction of PDP 8 is crucial for the initial investment of US$15.5 billion in green transition funds committed to Vietnam by the G7 group and other countries. At the same time, the Vietnamese market with huge potential is bound to attract more foreign investors to enter the country’s energy industry.
Summary: The approval of PDP 8 is a major event in the development of Vietnam’s energy industry and a cornerstone of the country’s future renewable energy development. PDP 8 has set a clear direction for the country to achieve its ambitious sustainable development goals, and the Vietnamese market has great potential.