Vietnam turns at last to promotion of renewable energies

Policies advocated by the Vietnam Energy Association to create a friendlier climate for development of technologies that make power from the wind, the sun and natural wastes seem to have won the Government’s support.

Tran Viet Ngai, chairman of the Vietnam Energy Association, talked with Thanh Nien Daily. He said: The demand for power is rising in Vietnam. It is estimated that we’ll need to be able to generate 30,000 MW by 2015, double the current capacity of our power plants. Traditional energies like coal and oil are becoming exhausted, and our imports of energy will increase. There’s an urgent need to use our sources of energy more effectively and economically. And in addition, Vietnam needs to explore renewable sources of energy.

Favored by Mother Nature, Vietnam has great potential to develop solar power, wind power, geothermal energy and biofuels. We’ll have to take advantage of this potential to help meet our demand for power.

Thanh Nien: Isn’t it true that so far we’ve hardly begun researching renewable energy?

Tran Viet Ngai: Developed countries have explored wind, solar energy and biofuels for a long time. If you include hydroelectric power, renewable energy currently accounts for about eight percent of total energy output in the US. It is near 15 percent in Germany, France and Japan.

In Vietnam, except for hydropower, we have not invested in these energies. That’s regrettable because these sources of energies are friendly to the environment. Now we are taking the first baby steps, building wind-power plants and using solar energy for public lighting.

Vietnam has potentials and there are already modern technologies to exploit this kind of energy. Our task is to choose suitable technology and put it to work. However, the development of this kind of energy faces certain barriers.

Thanh Nien: What barriers?

Ngai: In the national power strategy to 2025 and vision to 2050, the Government set goals for developing renewable energy. However, we still don’t have a clear national policy in this field. The government encourages renewable energy but we lack clear directions and incentives.

The fact is that the initial investment in renewable energy is higher than traditional energy. For instance, to install capacity to generate 1 KW of wind power, we have to invest from $2,500-3000. The investment cost for 1 KW of coal power is only $2000. Investors, therefore, don’t want to invest in wind or solar energy projects.

We also lack people trained in exploiting renewable energy.

Thanh Nien: How should we deal with these matters?

Ngai: We should decide to subsidize development of wind and solar energy, for example, we could give investors in approved ‘green’ power generation technologies exemption from value added tax and corporate income tax for the first ten years. Our investment policy should support this by encouraging build-operation-transfer (BOT) and independent power plant (IPP) arrangements – if investors can see that they will not lose money, they will work with us to develop renewable energies.

The Government has recently approved the Ministry of Industry and Trade’s proposal for a comprehensive fifteen year strategy to develop renewable energy in Vietnam.

The strategy foresees that Vietnam will build a legal framework to encourage the development and use of renewable energy, simplifying investment formalities and development supervision over renewable power projects; will give assistance to renewable energy projects and call on all economic sectors to invest in these projects; will develop human resources and form a market for renewable energy; and will set up a national fund for developing renewable energy. – Thanhnien

Tags: Vietnam renewable energy, Vietnam energy