Foreign investment in local energy scanty

Energy investment in Vietnam is forecast to amount to $5 billion a year but foreign investors still lack interest in the industry, according to international experts and investors.

Speaking at the Vietnam Energy Summit, organised by the Asian Business Forum in HCM City last week, Nguyen Duc Cuong, deputy head of the National Power Transmission Company, said the energy sector had spent about $750 million on the power grid annually, only to meet 30 percent of the requirement.

Cuong said ways were being sought to call for more investment from other sources, including official development assistance, bond issues, and commercial bank loans, but capital shortages are still huge.

International experts and business people at the event pointed out unclear policy, unattractive power tariffs and the unfair business environment as major barriers to new energy developments.

The price is only five cents per kWh, too low for investors, said a Singaporean company.

For investment in renewable energy, Erik Knive, chair of the summit and also an energy investor, cast doubt about the price of wind energy of 8.5 cents per kWh proposed by a local investor. The rate should range from 10 to 12 cents per kWh to ensure profit for the investor, Knive said.

Saigon Times

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Posted by VBN on Jul 1 2010. Filed under Energy, Investment. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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