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Vietnam renewable energy industry gaining momentum

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The Vietnamese renewable energy industry has been gaining momentum lately as the country considers renewable energy to play a pivotal role in achieving the ambitious Power Development Plan (PDP), says GlobalData.

The PDP is intended to strengthen the power grid and increase the renewable energy mix in order to accelerate decarbonisation. In this context, solar PV and wind are expected to drive the decarbonization sector in Vietnam and reduce the cost of solar PV systems by about 25 percent and wind projects by 17 percent by 2030.

“Vietnam’s installed power capacity is likely to reach approximately 135GW, growing by more than two folds from 55GW by the end of 2019. The renewable sources (including hydropower) are likely to fuel about half of the new overall capacity built of estimated 80GW by 2030. Solar PV and wind are likely to be the renewable flag bearers with more than 80% of the anticipated renewable capacity to be dominated by these two technologies. Solar PV has witnessed a staggering growth of about 1,000 times from a meagre 7.4 MW to an estimated 7,000 GW+ by the end of 2020.”

Ankit Mathur, practice head of power at GlobalData.

The country has unveiled a straightforward roadmap that has attracted investors’ attention and boosted morale, enabling the future assurance of an attractive and important renewable market for Southeast Asian counterparts. Although COVID-19 continues to unfold in unpredictable ways, it has a limited effect on investor sentiments. Vietnam’s renewable sector witnessed an increase in the volume of the deal with 19 asset transactions registered by the end of November 2020 compared to 16 transactions in 2019.

“Amid the pandemic, the country has to review the PDP blue-print providing more support and transparency to the power sector players and investors with cost benefits and flexible approach for developing projects. To achieve the power sector decarbonization and energy sustainability, Vietnam should also compliment the renewable expansion by providing multiple provisions and mechanisms for a greater transparency for the investors. Some of these mechanisms include encouraging technological developments, simplifying regulatory approvals and expansion of transmission, and grid infrastructure for a successful implementation of the renewables in the power grid.”

Ankit Mathur, practice head of power at GlobalData.
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