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May 14, 2024 / 17:50

Vietnamese Gov’t approves purchase of Laos wind power

Electricity imports from Laos are crucial to boost supply and mitigate power shortages in northern Vietnam in 2025 and beyond.

Deputy Prime Minister Tran Hong Ha has authorized the Ministry of Industry and Trade (MoIT) to purchase electricity from the Truong Son wind farm in Laos and invest in the necessary infrastructure to integrate it into Vietnam's power grid.

 A wind power project in Quang Tri Province. Photo: Minh Trang/VGP

The 250 MW Truong Son wind power project in Laos, managed by the Vietnam-Laos Energy Investment Joint Stock Company, is slated to start operations in the fourth quarter of 2025. This project will be connected to the 220 kV Do Luong substation in Nghe An Province to deliver electricity to Vietnam.

Deputy Prime Minister Ha stressed that the project's import and grid connection investments must be in line with the Power Development Plan (PDP) VIII and relevant regulations.

The Power Purchase Agreement (PPA) between the Vietnam Electricity Group (EVN) and the project's investors will be negotiated to ensure that the agreement is economically viable with reasonable power prices and procurement costs, sound legal foundations, defined responsibilities, and technical standards.

Earlier, the MoIT had mentioned in its proposal to the Prime Minister that the price of imported electricity, negotiated by EVN with the investor, would not exceed US$6.95 cents per kWh, which was the price quoted by the investor.

To ensure timely electricity delivery to Vietnam by Q4 2025, the investor will build the grid connection within Vietnam, reducing EVN's investment burden.

The ministry emphasized that importing electricity from Laos is crucial to boost supply and alleviate power shortages in northern Vietnam in 2025 and beyond. This plan aligns with the Vietnam-Laos agreement and PDP VIII.

Vietnam aims to purchase around 3,000 MW from Laos by 2025, although the actual amount could be around 1,977 MW. The PDP VIII projects that imports from Laos could rise to 5,000-8,000 MW by 2030 and 11,000 MW by 2050.

As of the end of April, electricity imports from Laos and China represented about 1.6% of Vietnam's total output, equivalent to 1.56 billion kWh.

To boost electricity imports from Laos, Minister of Industry and Trade Nguyen Hong Dien, during a meeting last week, urged EVN to speed up the construction of the 500 kV Mo Sun to Thach My line in Quang Nam Province and the 220 kV Nam Sum to Nong Cong line.

The North could face a power shortage of about 3,632 MW during the peak dry season (May to July). In an extreme water shortage scenario, a power deficit of approximately 6.8 billion kWh is expected in the North during May, June, and July, 2025. From 2026 to 2030, with the slow progress of new power sources, the North will receive minimal additional electricity, which is insufficient to meet the annual increasing demand.

While the Central and Southern regions can secure power supplies, they lack backup sources. By 2025, they might face shortages if multiple adverse factors occur simultaneously.

"The North may continue to experience power shortages during the peak dry season," the MoIT forecasts.