On 23 September 2020, the Ministry of Industry and Trade (“MOIT”) issued an Official Letter No. 5709/TTr-BCT (“OL 5709”) on approving the National Power Development Plan for 2021-2030, with a vision to 2050 (“PDP8”). Following the Government Standing Committee’s guidance on PDP8 in Notice No. 277/TB-VPCP dated 06 September 2022, MOIT made several notable proposals, as follows:

Total capacity

MOIT proposes to approve the PDP8 with a power source structure by 2030 with a total power capacity of about 121,495-146,430 MW (excluding rooftop solar power and cogeneration sources). Renewable energy other than hydroelectricity, i.e. wind power, solar power, biomass power, etc., accounts for 18.67-23.46% of the power source structure.

Total investment

Total investment for the development of energy plans for the period of 2021 to 2030 is about USD 106.3-127.8 billion, including investments in:

(i) energy sources of about USD 90.6-127.8 billion (with an annual investment of about USD 9.1-12.8 billion); and

(ii) the transmission grid of about USD 15.3-15.9 billion (with an annual investment of USD 1.5-1.6 billion).

Renewable energy

(a) Wind energy: OL 5709 calculated that the current operating wind project is 4,126 MW. The PDP8 shall prioritize developing both onshore and offshore wind projects. Previously, in Official Letter 4947/TTr-BCT in 2021, the expected capacity for onshore wind energy was 16,121 MW and offshore wind energy was 7,000 MW (in which 4,000 MW for the Northern region of Vietnam). After review, OL 5709 proposes to increase an additional 700 MW of onshore wind energy for the Northern region to exploit the wind potential of Northern mountainous provinces.

(b) Solar energy: OL 5709 calculates that to 2020, Vietnam has more than 105,000 operated rooftop solar systems with a total capacity of 7,755 MW. Considering the potential for rooftop solar development, the PDP8 encourages the development of rooftop solar systems for self-use purpose without selling or generating to the national grid. Moreover, 2,360.2 MW large-capacity solar power is proposed to continue to be implemented to avoid legal risks, i.e., lawsuits and compensation risks.

Energy price

The average energy price shall gradually increase from USD 7.9 cents/kWh in 2020 to 8.4-9.4 cents/kWh in 2030. As estimated from 2031 to 2050, the average energy price shall be within USD 10.8-11.4 cents/kWh.