Tiếng Việt

Government Entices Investment into Power Sector
The National Power Development Plan for 2011-2020 (Master Plan VII) with a vision to 2030 is aimed at bringing electricity prices closer to market prices and gradually eliminating the monopoly in electricity trading in order to create a transparent electricity market and attract more investment into the power sector.
Reducing monopoly

Master Plan VII was promulgated via Decision 1208/QD-TTg, aiming to ensure a sufficient supply of electricity for socioeconomic development. The domestic electricity output plus imported volume is predicted to total 194-210 billion kWh by 2015, 330-362 billion kWh by 2020 and 695-834 billion kWh by 2030.

Important goals of power development in 2011-2020 include gradually forming and developing a competitive power production market and diversifying the modes of investment and trading in electricity. On July 1, 2011, the competitive electricity production market was put into pilot operation. Instead of holding a monopoly in producing, distributing and transmitting power, the Electricity of Vietnam (EVN) Group has been assigned by the Prime Minister to establish power generation corporations which will be separated from the EVN Group to operate independently. So the State will hold a monopoly in the field of power transmission to ensure security of the entire national energy system. Reducing monopoly will help create a transparent electricity market, ensure the interests of users and attract more investment into the electricity sector.

To implement Master Plan VII, the entire electricity sector will need investment capital of about VND929.7 trillion (US$48.8 billion) until 2020. From 2011-2030, it will need about VND2,539 trillion (US$123.8 billion). At a press conference in July 2011, Deputy Minister of Industry and Trade Hoang Quoc Vuong said, "Master Plan VII requires a large amount of investment capital and with current prices, the electricity sector is unable to arrange enough investment capital for power projects. Therefore, the power development strategy and Master Plan VII indicate the need to bring electricity prices closer to market prices in order to attract more investment into the electricity sector and promote energy efficiency and conservation. Under the Government's guidance, electricity prices will be adjusted in a flexible manner so as to ensure a sufficiency of investment capital for the power sector, macroeconomic stability and social security."

Renewable energy a priority

Master Plan VII prioritizes developing renewable energy resources such as wind power, solar power and biomass power. Projections are to increase the percentage of renewable energy power from 3.5 percent of the total electricity output in 2010 to 4.5 percent by 2020 and 6 percent by 2030.

Specifically, the plan aims to increase the combined capacity of all wind power plants to about 1,000MW by 2020 and 6,200MW by 2030 so as to raise the percentage of wind power from almost zero percent at present to 0.7 percent by 2020 and 2.4 percent by 2030. The plan also gives a priority to developing hydropower, especially multipurpose hydropower projects which simultaneously help prevent floods, supply water and generate power. Total capacity of hydropower plants is projected to increase from 9,200MW at present to 17,400MW by 2020. Vietnam will put into operation its first nuclear power reactor in 2020. By 2030, the country's nuclear power capacity is projected to reach 10,700MW and nuclear power output about 70.5 billion kWh (10.1 percent of the total electricity output in Vietnam).

Recently, the Government promulgated Decision 37/2011/QD-TTg regarding incentives for wind power development. It is hoped that the Government will decide incentives for other types of renewable energy in the near future.

Vietnam will promote investment in small-sized hydropower plants, solar batteries, wind power plants and diesel power plants to ensure a sufficient supply of electricity for rural areas, especially the communes in remote areas, which have a difficult access to the national power grid. Projections are to supply electricity to 100 percent of communes and 98.6 percent of rural households by 2015 and 100 percent of rural households by 2020. From 2011-2015, Vietnam will expand the national power grid to supply electricity to 500,000 rural households, and provide electricity generated from renewable sources to 377,000 other families. From 2016-2020, the country will have additional 200,000 rural households accessing the national power grid, and 231,000 other families having electricity generated from renewable sources./.

From Vietnam Economic News

(11/08/2011 09:46)


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