Illustrative photo (Source: VNA) According to the Ministry of Industry and Trade (MoIT), in implementing thepolicy of the Party and Government in encouraging and creating favourableconditions for all economic sectors in local energy development, MoIT andother ministries proposed legal frameworks to build incentive mechanisms andencourage the development of renewable energy projects.
Recently, the MoIT has submitted to the Prime Minister for approval a mechanismto sell electricity from renewable energy projects, such as wind, biomass, andwaste-to-electricity and solar power, according to the Feed-in Tariff (FIT) for20 years.
The capacity of power projects in the form of BOT and IPP, excluding windpower, solar power and small hydropower, that had been put into operationby 2020 was 7,355 MW out of a total 62,250 MW capacity of power sources,accounting for 11.8 percent. Thermal power projects in the form of BOT and IPPare being implemented totalling 27,250 MW.
For renewable energy sources, as of December 31, 2020, there was 16,420 MW ofsolar power including 8,673 MW of concentrated solar power and 7,755 MW ofrooftop solar, 514 MW of wind power, 382.1 MW of biomass power, 9.43 MW ofwaste-to-power, meaning renewable energy accounts for 25.3 percent of the totalinstalled capacity.
MoIT calculated electricity output from renewable energy reached 5.242 billionkWh and 10,994 billion kWh in 2019 and 2020 respectively, contributing to asignificant reduction in high-priced diesel electricity.
Compared to the actual mobilised oil power data as per Vietnam Electricity'sforecast, diesel electricity has decreased by 2.17 billion kWh in 2019 and 4.2billion kWh in 2020, saving about 10.85 trillion VND to 21 trillion VND (471million – 913 million USD).
Hoang Tien Dung,director of MoIT’s Department of Electricity and Renewable Energy, said:“Renewal resources have actively supported the supply of electricity to thenorth of Vietnam when it lacked power as the load increased in May and June.
“Renewal resources are contributing to ensuring electricity supply for thewhole of the 2021–2025 period. Thus, it can be seen that renewable energysources have contributed significantly to ensure electricity supply forsocio-economic development and people's daily needs, reduce greenhouse gasemissions and other emissions in Vietnam,” Dung added.
In this case, Vietnam is developing a mechanism to attract investors, said thedirector, emphasising foreign investment in BOT power projects has increasedsignificantly in recent years, reducing capital pressure for the Government inimportant infrastructure projects, especially those requiring large amounts ofcapital and complex technology.
This makes an important contribution to the supply of electricity to thenational power system, especially as State-owned corporations face difficultiesin investment capital for power projects.
MoIT said the total investment capital needed to implement the selected powerdevelopment programme in the 2021-2030 period was about $99.32 billion. Ifdeveloped under the high-load plan, the annual investment capital requirementwill be about 1.58 billion USD, of which about 10.16 billion USD was for powersource investment and about 1.42 billion USD was for grid investment andtransmission.
However, he also said some shortcomings in mechanisms and policies are barriersfor some investors.
In order to attract economic sectors with conditions to participate in thedevelopment of the energy sector more actively, the ministry was studying andamending the Electricity Law to have a basis for socialisation of electricitytransmission activities, in order to remove bottlenecks in energyinfrastructure.
At the same time, it is studying mechanisms and policies to encourage privateinvestment in renewable energy sources, such as directing the electricitypurchase and sale mechanism, and bidding mechanism for investors.
Dung said the implementation of this mechanism will take more time, but it willbe fairer and more transparent for investors, ensuring harmony and balancebetween the development of renewable energy projects and the transmission grid.
At the same time, energy experts said to attract private investors for powerprojects, the main solution was still through price policy, adding once theelectricity price policy was appropriate, investors in the electricity industrycan ensure reasonable profits, and power projects will be attractive enough fordomestic and foreign investment, as well as the public and private sectors.
Vietnam is developing a national electricity development plan for the 2021-2030period, with a vision to 2045, with three major orientations.
It aims to promotethe diversification of energy sources, focusing on developing clean andrenewable energy sources. To achieve these goals, the country hasissued many mechanisms to encourage the development of wind power, biomasspower, electricity from solid waste and solar power./.
VNA
