Vietnam's draft PDP8 has failed to recognize the need of creating a much more flexible system that can accommodate a transforming modern technology mix

Mar 11, 2021 09:43 AM ET
  • Vietnam's just recently released draft power growth prepare for 2021-2030 (PDP8) has fallen short to recognize the value of developing an extra flexible system that can accommodate a changing modern technology mix, according to a new report from the Institute for Energy Economics and Financial Analysis (IEEFA).
Vietnam's draft PDP8 has failed to recognize the need of creating a much more flexible system that can accommodate a transforming modern technology mix

" After a years filled with dissatisfactions from the fossil fuel sector, organizers successfully evaluated the dynamism of renewable resource in Vietnam's fast-growing market," claims report author IEEFA Supervisor of Energy Financing Studies Asia, Melissa Brown. "Many conventional coal as well as gas-power projects failed to progress throughout the development process, just handling to fulfill half of the targeted ability for 2016-2020.

" Solar energy designers however over-delivered by 5 times, and they have done so in a portion of the time. This evidence would definitely inform the following phase of Vietnam's power development," Brown included.

The writers of the report believe that however, organizers have actually instead opted for generation-centric choices in shaping the lately published draft PDP8. And hence, instead of recognizing the value of establishing a more flexible system, base-load coal as well as gas-fired power will certainly continue to control 57 percent of the pipe to 2030 in the draft PDP8.

As the government assesses prepare for PDP8, IEEFA's brand-new report outlines four concerns that are entitled to interest if Vietnam intends to expand its generation mix, fulfill brand-new need for lasting power, and also control power tariffs, with renewables arguably playing a bigger function in PDP8, and also not less.

1. Modern technology cost presumptions deal with high projecting risk

PDP8's usefulness as a roadmap will be restricted as a result of the quick pace of energy change around the world.

2. Baseload nonrenewable fuel source alternatives include dangers that should be acknowledged as well as minimized

Vietnam's high dependence on coal power projects, which undergo regular delays, has actually put Vietnam on the brink of significant power scarcities on greater than one celebration.

3. Failure to represent real expenses of nonrenewable fuel source power will certainly hurt rate-payers in the long-run

One of one of the most vital take-aways from the rapid change in worldwide power markets is that power sector coordinators are progressively susceptible to deadly design mistakes if they fail to account for the real prices associated with various modern technology as well as fuel choices.

4. Ignoring the demand for green power will certainly endanger GDP development

Over the past 2 years, Vietnam's financial development potential has deviated sharply from what IEEFA has actually observed somewhere else in Southeast Asia.

" Vietnam needs to take bolder actions to win the self-confidence of high-value international financiers that are working hard to fulfill the needs of their global clients," wrapped up Brown. "The market's hunger for renewable energy investment is currently there. Now it's time to recognize constant cost renovations."