Dr. Mai Duy Thien
Reporter: How do you assess the wind power development in Viet Nam in the recent years?
Dr. Mai Duy Thien: Viet Nam has the great potential of wind power. However, up to now, wind power has not developed in line with its potential because so far, Viet Nam has been accustomed to the conventional energy sources. Not until VII Power Master Plan did Viet Nam focus much on the renewable energy sources, including wind power. As a new source of energy, the mechanisms and policies, etc., on wind power has been incomplete yet, causing obstacles and difficulties for investors.
For example, Viet Nam has not set up the priority mechanisms of lending to wind power projects at preferential interest rate; the procedures for the project implementation are still troublesome and multilevel, such as: land allocation and project approval by local authorities; planning approval by Ministry of Industry and Trade; power connection procedure conducted by EVN, etc.
Viet Nam's wind potential is very large, but can be only developed in the region from Quang Binh to the south, while in the north, it is often stormy and low stability in wind.
Reporter: It is said that there are not a lot of investors involved in wind power since the price of wind power is not attractive. What is your viewpoint of this matter?
Dr. Mai Duy Thien: That's right! Before the Prime Minister issued Decision No. 39/2018/QD-TTg dated September 10, 2018 on the mechanism of supporting the development of wind power projects in Viet Nam, the wind power price in Viet Nam was only 7.8 cents/kWh, much lower than that in other countries in the region and in the world. However, the investment capital in wind power projects must be very large and about USD 2-2.5 million/MW, because most of the equipment and technology are imported. The combination of low selling price and large investment capital causes the insignificant profit and prolonged payback period; therefore, it is difficult for the investors to arrange their loans from banks.
However, with the recent increase in wind power price under Decision No. 39/2018/QD-TTg (wind power price of the project onshore and offshore amounting to 8.5 US cents/kWh and 9.8 US cents/kWh, respectively), the wind power field will certainly attract more investors in the coming time.
Reporter: Despite many investors in wind power field, there have been several projects implemented. Please tell me the reason for that!
Dr. Mai Duy Thien: The first reason comes from the capabilities of investors. Wind power is a new field in Viet Nam, requiring the extremely high level and content of technology. Many investors have enough financial resources but fail to meet the required level of technology implementation and project management. Conversely, many investors are technologically qualified but cannot raise enough funds. Because of the very low price, some qualified investors still wait for the more appropriate price of wind power to implement their projects, etc.
In addition, there are some “virtual” investors who are incapable but still register their project as they know about the State’s policy on wind power development, so when the wind power price increases, they will transfer such projects to others, etc.
Reporter: In your opinion, which steps should be taken to eliminate the virtual and unqualified ones during the approval of the wind power projects?
Dr. Mai Duy Thien: The State and local governments should consider and review more carefully the capacity of investors upon approving the projects to prevent the virtual and impractical movement in the wind power field. At the same time, it is required to prevent the phenomenon in which the unqualified investors other than the qualified ones gain the opportunities, etc. For example, when the foreign investors conduct surveys for investment opportunity, they can see the projects everywhere, but all of which are suspended.
It is required to carry out the general review of the investment projects at all levels in order for the qualified investors to have opportunities to continue investment, but the projects of the unqualified and virtual ones must be revoked.
Reporter: In term of power system management, it is said that for the renewable energy in general and wind power in particular, the instability will adversely affect the reliability of the power supply. What are your opinions in this matter?
Dr. Mai Duy Thien: Given the reality of our country's present power supply, if renewable energy is intensively involved, the energy insecurity can happen. Therefore, it is required to work out the detailed and step-by-step roadmap and study to find out the appropriate renewable energy proportion in the grid at each period.
In addition, EVN in particular and the power sector in general are required to improve the reserve capacity, ensuring the rapid and timely compensation in case of decrease in the power output of renewable energy.
In the long run, when renewable energy is more involved in the electricity system, it is necessary to improve the capacity of the dispatch system; to focus on investment in technology, to control and calculate the renewable energy sources on the grid in each point of time and in each region, thereby working out the solutions to operate the stable power system and ensuring the energy security, etc. Up to now, in the world, many countries have also done their in-depth researches on smart grid control as renewable energy accounts for the large proportion of the electricity system. Viet Nam can consult and coordinate with foreign experts to access this technology.
Reporter: Given the reality in Viet Nam, do you have any recommendations to contribute to promoting the wind power development in coming time?
Dr. Mai Duy Thien: The price of wind power is the key factor which has been amended by the Prime Minister to be more reasonable and attractive to the investors. To promote the wind power development, in addition to power price, the State needs build up the preferential mechanisms on capital, interest rates and administrative procedures, etc., to create the favourable conditions for the investors.
Upon approving the planning, there is a need for close coordination among local authorities and the electricity. As in case of massive licensing by the local authorities, not in accordance with the planning of the transmission grid, such licensed projects will certainly face difficulties in energizing power to the grid.
Reporter: Thank you so much!