ABB Vietnam’ General Director Brian Hull said that it was necessary then to prepare clear policies for the development of renewable energy, including the guidelines on purchasing and selling wind power under new tariff and solar power development policy after June 2019, so as for the wave of investment to take place as planned.
Expressing this point of view, the leader of ABB recommended 3 main contents: Making planning of power grid infrastructure, standardizing Power Purchase Agreement (PPA), Applying simple and clear project approval process, aiming at facilitating the development of wind and solar power in Viet Nam.
Power demand surpassing economic growth
Data from the Viet Nam Electricity showed that demand for power will continue to grow at a higher rate than that of economic growth. The growth rate is at 10.3-11.3% per year in the 2016-2020 period and about 8.0-8.5% per year over the period of 2021-2030.
Power consumption in recent years has rapidly increased at an average rate of 12.04% per year in the 2003-2018 period, while the commercial power output in 2018 is expected to reach 192.1 billion kWh, increasing by 5.5 times over the year 2003’s, 34.9 billion kWh. This has made Viet Nam gradually increase its renewable energy to ensure sufficient power for load.
The revised Power development Plan VII requires that from now to 2020, power generated from renewable energy shall account for 9.9% of the total power generation capacity, an increase of 4.3% compared to Power Plan VII.
This plan expects wind and solar energy sources to meet the targets set out in the revised Power development Plan VII with 6,000MV of wind power and 12,000MW of solar power in 2030.
However, there is a fact that Viet Nam has just taken the “first steps” in its journey of renewable energy development. Its development scale and potential is still in limitation compared with other countries in the region, such as Thailand with about 62% of total installed capacity, equivalent to 3.5GW.
Mr. Nguyen Minh Quang at National Load Dispatch Centre said that renewable energy was considered a crucial source to fully meet the power demand of nation’s load in the future.
However, the development of renewable energy also increases challenges posed on power system, particularly grid congestion, power quality, demand for backup power, and reliability of power supply to the system.
In the context of limited development of the power grid in Viet Nam, the average construction duration of a power grid project is 03 years, while deployment time for a solar power project is around 01 year. The development of wind power which is considered as a major source of national energy also “accelerates pressure” on power system.
A need of long-term policy
There is a change in Viet Nam’s renewable energy development policy. While wind power investors still need to wait for guidelines on new electricity selling price, solar power investors are particularly interested in the change in solar power policy after 30th June 2019, when Decision of November 2017 is invalid.
There have been high-level dialogues among Government member and businesses in power industry. ABB’ General Director stated that “this should continue to ensure that policies and standards are specifically established and developed for Viet Nam”.
Currently, the investment rate in renewable energy continues to drop a more reasonable rate, 5-10% per year. This is an opportunity for Viet Nam to diversify its power sources to meet load demand.
Mr. Brian Hull believes that: “Predictable and long-term policy” will boost attracting capital from Europe, North America and Asia into renewable energy development projects in Viet Nam.
In order to do so, a “very important point” on which Mr. Hull mentioned is that Viet Nam needs to create “transparency in medium and long-term” in terms of pricing mechanisms for renewable energy, as well as scope for strengthening PPA (Power Purchase Agreement) so as to encourage foreign investors.
Technically, Mr. Brian Hull recommends that Circular regulating on power transmission grid should be developed to encourage solar farm investors to invest capital in appropriate technologies right at the farm to minimize pressure on the national grid.
As of 31st March 2017, the National Power Transmission system managed and operated by the National Power Transmission Corporation included 500kV and 220kV grids, with a total of 24,365km of lines and 140 substations with total transformer capacity of 77,613MVA.
ABB Viet Nam’s General Director said that the challenges of strengthening national power transmission network, dealing with the disruption of wind and solar power could be solved by the modern digital technology.
Viet Nam needs to apply technologies to better exploit wind and solar power and the application of integrated power technology which requires Viet Nam to upgrade its power transmission system as well as digitize control system to balance the power sources on the system.
In order to do so, Viet Nam also need to pay attention to addressing important issues such as renewable energy integration, network development, power grid and micro-grid automation. At the same time, sufficient technology shall be provided in power value chain, ensuring power safety and reliability.