Vietnam deputy PM orders revamp wind power investment rules

Vietnam's Deputy Prime Minister Hoang Trung Hai has instructed the Ministry of Industry and Trade to complete policies to support wind power projects in Vietnam and set up favorable conditions for investors, according to a report in the Vietnam News.

At a meeting of the ministry in Hanoi yesterday, Hai said the application of wind power in Vietnam was in the early stage. Installed wind power capacity in the country is estimated to be 9MW, 7.5MW of which had been connected to the national grid, with the remainder being were household turbines.

Hai said the wind potential in Vietnam had not been fully tapped due to difficulties in geographical conditions, technology and high and fluctuating development costs. The highest project development cost was USD2.77 million per MW while the lowest was only USD1.77 million per MW with the average investment to produce 1MW put at USD2.2 million.

Vietnam currently has 21 wind farm projects under way, located in the central provinces of Binh Thuan, Ninh Thuan, Binh Thuan and Lam Dong.

Hai said the license granting procedure was still spontaneous and unplanned. He requested that the new policy mechanisms clearly specify preferential treatment to help investors develop feasible wind projects. There should be policies to subsidize electricity, tax and land fees, notably the establishment of a renewable energies support fund.

The new mechanism should create a consistent legal framework for wind power in particular and renewable energy in general and act as a foundation when localities are faced with new energy project proposals.

Development of renewable energy, including wind and solar power, is considered a must for Vietnam as continued growth as hydro- and thermo-power production face increased challenges, according to experts.

To Quoc Tru, director of the Vietnam Energy Consultancy Center, said late last year that the country had built many hydro-power projects, and that several of its rivers had been fully tapped.

Under this scenario, Vietnam will have to look to coal imports to satisfy the energy needs of thermo-power plants. Vietnam's first nuclear power project will only begin operation in 2020, if it is built on schedule, Tru noted.

He also cited figures from a survey of the World Bank that estimated the total wind power potential in Vietnam at around 513,360 MW, equivalent to 200 times the output of the Son La hydropower power plant, and 10 times the total capacity of the country forecast for 2020.