The workshop "Mobilizing international financial resources for independent power projects" took place in the morning of 24 November 2020
Resolution No. 55-NQ/TW of the Politburo sets out a viewpoint of ‘encouraging and creating all favorable conditions for all economic sectors, especially private economic sectors, to participate in energy development’, Dr. Nguyen Duc Hien - Deputy Head of the Central Economic Commission said. At the same time, the Resolution also formulates tasks of studying and completing special financial mechanisms and capital mobilization schemes for investment in developing the power industry.
To ensure realization of the goals set out in Resolution No. 55-NQ/TW, in which the total installed capacity will reach about 125–130 GW, the electricity output will reach about 550-600 billion kWh by 2030, the power industry will need to be invested on a very large scale (USD133.3 billion in the period of 2021-2030).
Seeking for and accessing to financial resources from international financial and credit institutions to invest in power generation projects, especially in independent power generation projects, is a very necessary requirement, given the context where funding from State budget faces many difficulties, ODA financial resource is increasingly limited, along with a number of restrictions on mechanisms and policies related to financial arrangement and domestic securities issuance for energy projects.
Leading speakers and experts in the fields of finance, banking, law, and energy attended and presented their views at the workshop. The speakers focused on a number of topics such as: an overview of the funding process and risk allocation between parties in Power Purchase Agreements (PPAs); ways to improve the national credit rating for Vietnam; specifically bankability criteria and risk allocation approaches in Power Purchase Agreements as for independent power projects; foreign exchange management policy of Vietnam, etc.
In addition to the presentations, the workshop also had a Q&A and discussion session on mechanisms and policies related to the topic of the workshop with the participation of international experts, ministries and authorities of Vietnam.
The workshop is a useful forum to help Party's advisory bodies, State management agencies, researchers, experts and the business community have discussion and further assessment of approaches, methods and conditions proper to mobilize financial resources from international capital market for energy development in general and for independent power projects in particular.
By August 2020, about 16,400 MW of independent power plant (IPP) projects (accounting for 28.3% of the installed capacity of the whole system) had been invested and put into operation and on a growing trend in the spirit of the directions of Resolution 55.