Visitors visit a booth on Solar Show 2019 in HCM City. (Photo: VNA)HCM City (VNS/VNA) – Vietnam could meet its long-term energy demands by addingrenewable energy sources and cutting-edge battery storage technologies to itsarsenal of solutions, experts said at a two-day international conference onrenewable energy that ended on April 4 in HCM City.
Speaking on the sidelines of the conference, Nguyen Tam Tien, CEO of Trung NamGroup, said that renewable energy generation has already significantlyincreased. “Renewable energy, especially solar and wind power, will be thefuture of Vietnam's long-term energy strategy,” he said.
Mai Van Trung, business development director at SolarBK, said thecountry has favourable conditions to develop solar energy and thatcommercial and industrial solar PV rooftop applications have great developmentpotential.
Rooftop solar panels have also become more affordable for homeowners andcommunities, he said.
Samresh Kumar, managing director of Principal Investment at VinaCapital, saidsolar rooftop power presents an effective solution which provides acommercially viable option, especially for the commercial and industrialsegments.
Solar power leverages existing infrastructure and monetises idle assetswithout requiring additional land, and it is also efficient because poweris produced only where it is needed and thus frees up the grid, he noted.
John Rockhold, head of the Power and Energy Sub-working Group under the VietnamBusiness Forum, said rooftop solar panels must be encouraged to reduce pressureon the national grid, while modest annual price increases and a road map forefficiency energy are badly needed.
Huge investment
Vietnam has a great opportunity to reach its energy security goals byattracting local and foreign investment, according to Rockhold.
New technologies are creating opportunity for the renewable energy sector, hesaid, adding that such technologies could help lower the cost of equipment forsolar and wind energy.
Vietnam will require around 10 billion USD annually between now and 2030to meet the growing demand of the energy sector, experts said.
With such high capital requirements, the government has allowed 100 percentforeign ownership of Vietnamese companies in the energy sector.
Foreign investors can choose among permitted investment forms such as 100percent foreign-invested company, joint ventures or public-private partnership(PPP).
FDI and domestic investment from the private sector could include investment inbatteries and other storage methods, which would help stabilise supply andextend the availability of solar and wind power sources.
By storing renewable energy and keeping supply high, prices for solar and windpower could be lowered.
With low feed-in-tariffs (FiT) and high production costs, PPPs are the mosteffective means of entering the market to minimise risks. The PPP term isusually 20 years from the commercial operation date.
Government efforts
With 66 percent of rural inhabitants, Vietnam isscaling up its efforts to bring electricity to the entire population, whetheron or off-grid, increasing electrification rates and preparing the country forgrowth.
Vietnam is one of the most efficient power markets in Southeast Asia, driven bylow-cost resources such as hydro and coal. The country has achieved around99 percent electrification with relatively low cost in comparison toneighbouring countries.
With electricity demand projected to increase by eight per cent annually until2025, Vietnam aims to develop renewable energy sources to ensure energysecurity and address growing power demand.
Hydropower currently holds the largest share among all renewable energysources, followed by biomass and wind. Solar energy, biogas, andwaste-to-energy technologies are picking up slowly while geothermal energy andtidal energy are at a very early stage.
Renewables could become Vietnam’s lowest-cost option to meet its energy needs.
In recent years the Government has developed initiatives to boost renewableenergy, especially solar and wind power. Tax incentives includepreferential corporate income tax rate of 10 percent for 15 years, corporateincome tax exemption for four years, and a reduction of 50 percent for thefollowing nine years.
Other incentives include preferential credit loans, land use tax exemption, andland rental exemption.
To ensure consistent returns for investors, the government has also approvedelectricity prices for on-grid renewable energy, including standardised powerpurchase contracts (20 years) for each renewable power type.
EVN, the sole buyer of electricity in Vietnam, has also been mandated toprioritise renewable energy in grid connection, dispatch, and purchasingelectricity at approved tariffs.
From now until 2030, Vietnam’s economy is forecast to grow at a high rateof between 6.5 and 7.5 percent per year.
The conference was held during the two-day Solar Show Vietnam 2019,Power & Electricity Show Vietnam, Energy Storage Show Vietnam, and WindShow Vietnam, which attracted hundreds of policymakers, regulators, investorsand financiers from Vietnam, Asia-Pacific region and beyond.
The trade shows were also attended by power producers, project developers,renewable energy vendors, and business owners and land developers.-VNS/VNA
