wind energy development in vietnam

Hanoi, Wednesday, December 8, 2021

Planning, policy and integration for sustainable

development of wind energy in Vietnam 2022 – 2030

Minh Ha-DuongResearch Director

Vietnam Initiative for Energy TransitionEmail: minh.haduong@vietse.vn

4th Vietnam Onshore and Offshore Wind Summit. Hanoi, December 8th, 2021

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Accelerate the Transition of Vietnam toward aCarbon-neutral Society

think tank mission:

Offshore wind studies conducted by VIET

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1. The last two years2. Revisiting scenarios made in 20193. Ways forward

Ha-Duong et al. (2021) Planning, policy and integration for sustainable development of offshore wind

energy in Vietnam 2022 – 2030. VSOE2021 proceedings,. Lecture Notes in civil engineering vol. 208.

Springer ISBN 978-981-16-7734. Available at https://minh.haduong.com .

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1. The last two years2. Revisiting scenarios made in 20193. Ways forward

Vietnam climate mitigation goals● 2015 : We commit to a 8% - 25 % GHG reduction by 2030

compared to 320% baseline increase, not including industrial processes (INDC)

● 2016 : We strive to meet 100% domestic renewable energy productionas rapidly as possible, while working to end energy poverty and protect water and food security, taking into consideration national circumstances. (Climate Vulnerable Forum)

● 2020 : We commit to a 9% - 27 % GHG reduction by 2030compared to baseline (updated NDC)

● 2021 : We will make use of our own domestic resources, along with the cooperation and support of the international community, especially from the developed countries, in terms of finance and technology, including through mechanisms under the Paris Agreement, in order to achieve net-zero emissions by 2050 (COP26)

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Source: VIET plots based on data from EVN

Power mix of Vietnam by installed capacity

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2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 20210

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

90 000

3980

16902

Coal Oil Gas Hydro Small hydro Wind Solar Biomass

MW RE “booming” phase

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 20190

50

100

150

200

250

300

350

Total wind power capacity in Vietnam (MW)

2004 False startFailed cooperation projectHybrid diesel + windBach Long Vi island

Vietnam wind power history to 2019

2012 : First high-capacity wind farm by REVN, 30 MW.

2013 : Phú Quý island hybrid grid 6 MW and near-shore Bac Lieu phase 1, 16 MW.

2014, 2015No new capacity.

2016 : Phu Lac, 24 MW,Bac Lieu phase 2, 83 MW.

Provincial plans published.

2017 : Hướng Linh 2, 30 MW.

May 2019 : Seven wind power plants in operation = 331 MW

April 2019 : Trung Nam hybrid facility, co-locating 40 MW wind with 204 MW solar PV

MW

2011 : FIT17.8 UScent/kWh

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Vietnam wind power history – the last two years

2011 : FIT17.8 UScent/kWh

2018 : new FIT8.5 UScent/kWh onshore9.8 UScent/kWh offshore

01/01/2005 28/09/2007 24/06/2010 20/03/2013 15/12/2015 10/09/2018 06/06/20210

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

MW

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Letter 10052/BCT-DL, Letter 6742/EVN-TTD

Development of the wind projects pipeline in Vietnam

Planned 2030

November 2021

August 2019

0 2 4 6 8 10 12 14 16 18 20

COD (69 + 15 projects) non COD (15 projects part-COD) only PPA (62 projects)

only Authorized Proposed to PDP (133 projects)

GW capacity

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1. The last two years2. Revisiting scenarios made in 20193. Ways forward

Three scenarios forInstalled wind capacity in 2030

Onshore Offshore

Old Plan 6.1 GW 0.15 GW

New Normal 16.6 GW 9.5 GW

Factor Three 21.6 GW 20.9 GW

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Old Plan scenario

● A wave of new wind farms connected to the grid in time to get the FIT, before November 2021.

● After that, the government does not renew the FIT,● legal issues delay the first pilot auction and● a global economic crisis impacts Vietnam, reducing economic growth and

therefore domestic electricity demand.

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New Normal scenario 

● Big initial wave of wind projects in 2021, then● market pulled by government auctions and● by multinational companies procuring green electricity directly from wind project

developers.● The government credibly commits to an auction program for 2 GW of offshore

wind per year after 2025.

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Factor Three scenario 

● The national oil and gas company PVN redefines itself as a sustainable energy provider, to play on its offshore work capacities and the complementarity between gas and variable renewables.

● The Thang Long Wind power project starts operating its first 600 MW phase at the end of 2022.

● Government adopts a regional leadership strategy in the wind energy sector.

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1. The last two years2. Revisiting scenarios made in 20193. Ways forward

Align 2030 goals on 2050 objective

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14 projects here for 28,4 GW

vs.

November PDP8 goals4 GW by 203036 GW by 2045

Plan more Offshore wind

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Roadmap to reach 10GW of Offshore wind (2023-2030)

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Source: Phuong H. Nguyen, Van Nguyen Dinh et al. (VSOE 2021) Options for zonation and grid integration of offshorewind in Vietnam.

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Invest North, avoid curtailment in the Center

Source: VIET (2020) Ability to release capacity for wind power and solar power up to 2022. RR/04 – VIET06.2020 21

Worst case: No transmission upgrade, Sunday of June 2022

In Central Highlands Wind runs at 40% capacity

Solar at 60%

In South-CentralVariable renewables at 74% capacity in Ninh Thuan, Binh ThuanThey run at 44% in Binh Dinh, Phu Yen, Khanh Hoa

2020 2021 2022 2023

Direct Power Purchasing Agreement Pilot

2025

Development of Competitive Power MarketRetail market to open(big power users)

Auctioning scheme for RE energy

Wholesale market open

Renewable Portfolio Standard

2024

Emission Trading System

2019

Open the market - forget FIT

EIA RegulationSea Surface leasing regulation

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2020 2021 2022 2023 202520242019

Enact policy framework

Oct. 2019 Power Development Plan 8 to 2030, vision 2045Dec. 2019 National Energy Plan to 2030, vision 2050

Sea Ports System Plan to 2030, vision 2050 Marine Spatial Master Plan to 2030, vision 2045

Land Use Master Plan to 2030, vision 2050 National Master Plan to 2030, vision 2045

Renewable Energy Law

Electricity Law, v3

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Concluding remarks

● Old plan scenario is behind us● New Normal is within reach – add more offshore wind● Factor Three needs serious thinking – market-based

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