Vietnam Aims to Boost Renewables, but Fossil Fuels Still a Major Part of the Mix

Vietnam is facing a power crisis, with outages hitting major cities across the country. The government has blamed the outages on a combination of factors, including a lack of investment in new power plants, a surge in demand for electricity, and a drought that has reduced hydroelectric power output.

The outages have highlighted the challenges that Vietnam faces as it transitions to a more renewable energy-based economy. It has set ambitious goals for reducing its reliance on coal, but it has struggled to build enough new renewable energy projects to meet demand.

In the short term, the government is relying on imported coal to meet its energy needs. However, this is not a sustainable solution, as it increases Vietnam's dependence on foreign energy and contributes to climate change.

In the long term, Vietnam needs to invest in new renewable energy projects, such as solar and wind farms. It also needs to improve its energy efficiency and conservation efforts.

The Plan

Power Development Plan 8 (PDP8), the country's energy strategy, seeks to more than quadruple Vietnam's maximum power output to over 150 gigawatts by 2030. Though far less than Japan's 290 GW, that is greater than the capacity of wealthy nations like France and Italy, according to APNews.

It calls for a significant move away from highly polluting coal and an increase in the use of domestic gas and imported liquefied natural gas, or LNG, which will account for roughly 25 percent of total generating capacity and nearly 50 percent of all energy by 2030 from hydropower, wind, solar, and other renewable sources.

The Future of Energy in Vietnam

Vietnam's new energy plan forbids the construction of any new coal-fired power plants after 2030 as the nation switches to cleaner fuels, but overall coal generation capacity will still increase by 2030, making up about 20 percent of total energy production, down from the current 30.8 percent.

According to the plan, all coal plants in Vietnam would switch to using biomass and ammonia by 2050, ending the country's reliance on coal for electricity production.

(Photo: Wikimedia Commons / USAID Vietnam) Michael Greene, USAID Vietnam Mission Director, (right) and Nguyen Van Quyet, Coca-Cola Vietnam Supply Chain Director, (left) signed the memorandum of understanding at the USAID/Vietnam office in the presence of Ms. Gloria Steele, USAID’s Senior Deputy Assistant Administrator for Asia, (center) and other representatives of USAID/Vietnam and Coca-Cola Vietnam.

Vietnam wants to increase its usage of LNG, chilled natural gas that is primarily made of methane and whose production and transportation leaks add to global warming, so a gradual transition away from coal won't wean Vietnam from fossil fuels.

With its rapid industrialization and widespread access to electricity, Vietnam has made great achievements in increasing its usage of renewable energy. In 2022, it produced half of the nation's electricity, an increase from just a quarter of a decade earlier. The electricity grid, though, hasn't kept up with improvements

An overhaul of the entire power system is required, according to Aditya Lolla, the Asia program lead at independent Energy of Ember, who noted that the plan would probably result in short-term increases in electricity rates even though it will stabilize prices and the supply of power over the long term.

The power crisis in Vietnam is a reminder of the challenges that countries face as they transition to a more renewable energy-based economy. It is important for countries to invest in new renewable energy projects and to improve their energy efficiency and conservation efforts.