Monday,  Jul 6, 2020,06:08 (GMT+7) 0 0
Government’s regulatory support boosts wind power development
By Minh Tuan
Wednesday,  Jun 10, 2020,07:37 (GMT+7)

Government’s regulatory support boosts wind power development

By Minh Tuan

The Phu Lac wind power plant in Binh Thuan Province – PHOTO: VGP

HCMC - Stronger regulatory support from the Government including several policies in recent months to boost the development of the wind power sector, especially offshore wind, as well as rising investor interest have provided the shot in the arm that Vietnam’s wind energy sector needs, according to Fitch Solutions.

The Prime Minister issued a resolution in March 2020 over a five-year plan to develop renewable energy sources off the coast, with specific mechanisms and policies to attract both foreign and local developers to invest in the sector.

The offshore wind sector was also emphasized in the National Energy Development Strategy of Vietnam until 2030, and the Government is in the process of amending the seabed lease and licensing requirements for large-scale offshore wind farms alongside the Ministry of Natural Resources and Environment.

The Ministry of Industry and Trade has proposed including several wind projects in the upcoming Power Development Plan and extending the feed-in-tariff deadlines for wind power projects by two years until 2023, from the original commercial operation date deadline in November 2021.

This extension aims to support investors, whose wind power projects have been postponed and will not be completed on time due to the negative impacts of Covid-19, including supply chain disruptions, labor shortages and suspended construction.

Fitch Solutions expects the Government to announce a new Power Development Plan this month with renewable energy and a special focus on wind power.

According to the Netherlands Enterprise Agency, Vietnam is considered to have the best wind resources in Southeast Asia, especially in coastal regions in the south. In these areas, the yearly average wind speeds are measured at 9 to 10 meters per second.

Binh Thuan Province in the south-central coastal region and Tra Vinh, Bac Lieu and Soc Trang provinces in the southern coastal region have the highest potential for wind power.

Due to both rapid industrialization and remarkable economic growth, the demand for electricity in Vietnam is annually increasing at 10%. The Vietnamese Government has formulated ambitious goals for renewable energy, especially wind energy, which is presented as an important renewable energy source for the future.

According to data from the Ministry of Industry and Trade, there are currently 11 wind power projects operational in the country, with a total capacity of 377 megawatts (MW), and over 31 projects with a total capacity of 1,660 MW are scheduled for operation in 2020 or 2021.

Capacity targets for the country’s wind energy sector are expected to increase to 6GW by 2025 and 10GW by 2030 from the existing 2GW and 6GW, respectively. The Government is also looking to introduce a new Direct Power Purchase Agreement, where renewable energy producers can sell and deliver electricity directly to corporate customers.

“We believe these developments will encourage further growth and investment in the sector. We have already seen growing investor interest across Vietnam’s wind sector over the past year, which has strengthened the pipeline significantly,” concluded Fitch Solutions experts.

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