Hanoi (VNS/VNA) - Vietnam is in the early stages of developingrenewable energy sources and needs to introduce more incentive policies toattract more investment, experts have said.

Deputy Minister of Industry and Trade Hoang Quoc Vuong said that the rapidincrease in energy demand and consumption, at around 10 percent per year, hadnegative impacts on the environment as well as exhausted natural resources andaffected energy security.

However, the development of clean energy still had certain limitations such asunstable supply, difficulty in energy transmission and high costs, Vuong said,adding that the ministry was studying solutions to efficiently developrenewable energy towards a low-carbon economy.

With a total capacity of nearly 50,000MW, Vietnam ranked second in SoutheastAsia and 23rd in the world by power system capacity.

However, it was necessary for Vietnam to develop a structure of energy supplysources, including hydroelectric, thermoelectric and renewable energy, Vuongsaid.

Promoting an energy transition towards a low-carbon economy was critical, hesaid.

He cited statistics that the total capacity of hydropower plants reached22,000MW by the end of 2018. By the end of 2019, the capacity of solar and windpower plants were estimated to reach 1,000MW and 1,500MW, respectively.

Vuong added that the ministry was also receiving a number of proposals todevelop wind and solar power projects in the country.

He said that the Government’s target that renewable energy output would accountfor 20 percent of the power system’s total output could be within reach,providing that Vietnam had attractive policies for investors.

According to Aya Yoshida from the International Energy Agency, Vietnam is inthe early stages of developing renewable energy, thus the Government needed todevelop appropriate mechanisms to reduce risks for investors in renewableenergy development.

She stressed that investing in renewable energy and improving energy efficiencywould contribute significantly to reducing CO2 emissions, energy imports andenvironmental pollution.

Pham Huong Giang, deputy head of the Renewable Energy Department under theMinistry of Industry and Trade, said the ministry was studying mechanisms topromote investment in developing renewable energy.

According to Tran Dinh Nhan, Director of the Electricity of Vietnam (EVN),there was a possibility of power shortages after 2020, thus developing rooftopsolar power was considered an important solution to cope with the pressure onpower supply.

Although Vietnam had policies for developing solar power with the PrimeMinister’s Decision 11/2017/QD-TTg dated April 11, 2017, the development ofrooftop solar power remained modest compared to the potential.

As of the end of 2018, EVN installed 54 rooftop solar power projects with atotal capacity of 3.2MWp and signed contracts to buy rooftop solar power with1,800 customers with a total capacity of 30.12MWp. The results were modestcompared to the solar power potential in Vietnam, Nhan said.

He questioned whether the rooftop solar power price policies were attractiveenough to encourage installation while the costs for rooftop photovoltaic powerstations remained high.

Dao Minh Hien from the Power Engineering Consulting Joint Stock Company saidthe high cost of installation was the major barrier to the widespreaddevelopment of rooftop solar power systems, adding that models to providesupport to citizens to install rooftop panels should be developed.

Several models could be put into consideration such as power companies rentingthe rooftops of citizens or leasing the photovoltaic power station.
The Ministry of Industry and Trade hasrecently publicised a draft about mechanisms for new solar power development inVietnam which was expected to come into effect in June 2019.

According to the draft, the solar power buying prices would range from 1,803 VNDto 2,486 VND (7.89 US cents) per kWh, depending on zones classified by solar radiationintensity.-VNS/VNA