Vietnam has recently attracted many foreign corporations from the US, Switzerland and France to invest in gas-fired power projects.
Vietnam will need to generate an addition of 6,000-7,000 MW of power yearly
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Earlier, the US-based company signed a memorandum of understanding (MoU) with the Bac Lieu People’s Committee to build the 100ha plant, which has a total designed capacity of 3,200 MW. The plant will be implemented in three phases.
President of the US’s AES Group Vietnam David Stone has recently also said his company is carrying out researches for its investment in the Son My 2 gas-fired thermal power project in the form of Build-Operate-Transfer (BOT) in the central province of Binh Thuan.
Son My 2 LNG Power Plant Project is one of the nine gas thermal power projects assigned by the government to PetroVietnam as the investor and the electricity project under the VII Power Development Master Plan.
The project is expected to include three Son My 2.1, Son My 2.2 and Son My 2.3 plants with an expected capacity of 750 MW each, using imported gas for power generation at the Integrated Industrial Complex - Son My Petroleum. According to the plan, three plants under the Son My 2 LNG Power Plant Project will come into operation in 2023, 2024 and 2025 respectively.
The Son My 1 gas-fired power plant in Binh Thuan is also on the radar of France’s EDF. Meanwhile, Switzerland-based Astra Transcor Energy’s AOT Energy is also seeking cooperation with PetroVietnam to build a US$650 million LNG complex.
Another investor from the US, General Electric (GE), has recently inked a framework for co-operation with state-owned energy firm PetroVietnam to develop two gas-fired power plants with a combined capacity of 1,500MW in the central province of Quang Nam, using about 830 million cubic meters of gas from the Ca Voi Xanh (Blue Whale) gas field.
Reasonable choice
Vietnam's robust industrialization process has fueled demand for electricity in recent years. The government estimated electricity consumption to grow by 10-12 percent annually through 2020, thus power shortages are expected during this period if adequate measures are not taken to increase the supply accordingly.
Deputy Minister of Industry and Trade Hoang Quoc Vuong said that the country will need to generate an addition of 6,000-7,000 MW of power yearly to meet the nation's GDP growth of 7 percent in the next few years.
It means the country will need US$10 billion per year for the construction of power plants, exclusive funding for power transmission and distribution, Vuong estimated.
The country has so far still depended mainly on coal-fired thermal and hydropower projects which have caused many negative impacts on the environment such as flooding and deforestation.
Meanwhile, it won’t be easy to develop renewable energy sources such as wind and solar power due to its expensive investment costs. Thus, it will be reasonable to develop gas-fired power projects before the country can afford renewable energy projects.
According to experts, emissions of gas-fired power plants are much lower than coal-fueled power plants and there is also minimal waste that can pollute the environment.
Bac Lieu’s authorities have so far evaluated the gas-fired power project as feasible with reasonable prices which are lower than power produced by coal-fueled plants, wind and solar farms.
In Vietnam’s new FDI attraction strategy in the next five years, Nguyen Mai, chairman of the Vietnam Association of Foreign Invested Enterprises (VAFIE), also suggested that among priority sectors, Vietnam should choose modern and high-tech investors to develop gas-fired thermal power projects.
