Amending 188bet asia Law on Electricity to unlock resources for energy security and net zero emissions

A wind farm in Gia Lai Province. Amending 188bet asia Law on Electricity becomes pressing to provide a vision and set out a roadmap towards energy security and net zero by 2050. — VNA/VNS Photo Vũ Sinh 

188bet asia draftamendment to 188bet asia Law on Electricity, which is on 188bet asia agenda at 188bet asia current session of 188bet asia National Assembly, will be a bold step for Việt Nam towards ensuring national energy security and achieving net zero emissions by 2050, through creating a more favourable mechanism to break down 188bet asia barriers of investments in 188bet asia energy sector.

188bet asia General Secretary of 188bet asia ruling party, Tô Lâm, has emphasised 188bet asia necessity of amending 188bet asia Law on Electricity in response to energy infrastructure requirements, which are considered a key to creating socio-economic development breakthroughs.

While Việt Nam is facing 188bet asia pressing question of how to ensure adequate energy supply for 188bet asia country’s rapid socio-economic growth and sustainable development, amending 188bet asia Law on Electricity is a way to provide a vision and set out a roadmap towards energy security and net zero goals for 2050, according to Party General Secretary Lâm.

188bet asia Law on Electricity was promulgated in 2004 and had undergone four amendments during 188bet asia past two decades, Minister of Industry and Trade Nguyễn Hồng Diên said. To date, 188bet asia law had been shown to have shortcomings and was unable to resolve newly arising problems.

Without guaranteed and transparent mechanisms for energy development, it would be difficult for Việt Nam to meet 188bet asia rising demand for electricity, Diên said.

He cited statistics showing that by 2030, or around five years from now, Việt Nam must double 188bet asia current total capacity of electricity production to 150,524MW, and that 188bet asia country would need an energy capacity five times higher by 2050, equivalent to 530,000MW.

To achieve 188bet asia goal of carbon neutrality by 2050, Việt Nam would have to focus on developing renewable energy and accelerating 188bet asia energy transition away from fossil fuels. 188bet asia country also needed to have a transparent and compatible legal system, he said.

“Amending 188bet asia Law on Electricity aims to promptly institutionalise 188bet asia Party’s new policies. At 188bet asia same time, it aims to tackle bottlenecks in 188bet asia existing regulations to ensure consistency and promote 188bet asia sustainable and efficient development of 188bet asia power industry to meet rapidly increasing demand, and fundamentally change 188bet asia structure of power sources to achieve net zero by 2050, as well as ensuring 188bet asia national energy security,” Diên said.

188bet asia draft amendments to 188bet asia Law on Electricity with nine chapters and 130 articles will focus on six major issues, including planning and investing in electricity development to ensure energy security, promoting 188bet asia development of renewable and new energy, completing regulations on electricity operation, pricing mechanisms for a competitive electricity market, encouraging energy savings and efficiency, and ensuring safety.

Unlocking resources

Việt Nam’s electricity market is facing numerous challenges, especially in attracting investments in independent power projects on 188bet asia path towards energy security and carbon neutrality.

188bet asia draft amendment to 188bet asia Law on Electricity is expected to create a legal framework for enterprises, credit and financial institutions to invest in 188bet asia energy sector, especially in offshore wind power and LNG power projects, according to 188bet asia Ministry of Industry and Trade.

Currently, 188bet asia implementation of electricity generation sources following 188bet asia Eighth National Power Development Plan (PDP8) is slower than expected, which might affect national energy security.

According to Diên, Việt Nam is committed to achieving carbon neutrality by 2050, meaning that renewable energy must be developed rapidly.

188bet asia absence of a detailed legal framework for renewable and other types of energy such as hydrogen, green ammonia and nuclear power is a big problem. 188bet asia PDP8 was revealed nearly one and a half years ago, but there have been no new proposals for energy projects due to 188bet asia lack of detailed regulations and policies.

"If Việt Nam does not promptly issue appropriate and feasible mechanisms and policies, it will be impossible to attract investments in 188bet asia energy sector. As a result, it will be difficult to meet 188bet asia country’s energy demand," Diên said.

“It becomes pressing for Việt Nam to establish a feasible and appropriate legal framework to attract investors in electricity generation and 188bet asia grid.”

Diên also said that nuclear power should be included in 188bet asia law to set a foundation for its future development.

 Workers of Việt Nam Electricity are checking a transmission line. Việt Nam needs huge investments in electricity generation and grid to meet 188bet asia rising demand. — VNA/VNS Photo

 An independent energy consultant, Phan Xuân Dương, estimated that under PDP8, Việt Nam would need around US$12 billion each year to invest in electricity generation projects by 2030 and $18-24 billion each year in 188bet asia 2030-2050 period.

188bet asia huge demand for capital could not come from 188bet asia limited resources of State-owned enterprises such as Việt Nam Electricity (EVN), Việt Nam Oil and Gas Group (PVN), and Việt Nam National Coal and Mineral Industries Holding Corporation Limited (TKV).

He pointed out that a 1,500MW LNG power project would require an estimated investment of up to $2.5 billion, and around $3 billion would be needed for a 1,000MW offshore wind power project.

Thus,Dương said, it was necessary to diversify capital sources and forms of capital raising in order to effectively attract both domestic and foreign resources into electricity development.

In both 188bet asia draft amendment and PDP8, 188bet asia need for diversification of investments, including from State, private and public-private partnership sources has been highlighted.

Dương said that 188bet asia law amendment needed to set mechanisms to attract investments in electricity generation, especially gas-fired power and offshore wind power projects.

Under PDP8, Việt Nam will develop ten additional LNG projects, which will use domestically produced gas with a total capacity of 7,900MW, and 13 projects which will use imported LNG with a total capacity of 22,542MW. Currently, only one project, Nhơn Trạch No 3 and 4, is under implementation and expected to go operational commercially in May 2025. Other projects are stuck due to roadblocks in raising credit.

To date, there had been no offshore wind power projects being implemented in Việt Nam in order to achieve a capacity of 6,000MW by 2030 as set under PDP8, Dương said. “If a strong mechanism to unlock resources for power generation is not developed, there will be a risk of failure to meet 188bet asia demand.”

188bet asia draft laid out a framework for offshore wind power, but more detailed guidance was needed once 188bet asia bill is passed so that offshore wind power projects could attract and realise investments, he said. 188bet asia legal framework for LNG power projects would also need to be improved to attract foreign resources.

Early promulgation expected

188bet asia Government expects that 188bet asia amendment to 188bet asia Law on Electricity will be passed at 188bet asia current session of 188bet asia National Assembly, which will run until 188bet asia end of November.

According to energy expert Thái Doãn Hoàng Cầu 188bet asia draft amendment may not be perfect and may not anticipate all problems which might arise in 188bet asia future. It also may not fully meet all requirements, multi-dimensional perspectives and different interests of all organisations and individuals involved.

For instance, there is still a shortage of detailed regulations for major policy goals such as offshore wind and nuclear power.

Although more studies and adjustments are needed, 188bet asia draft amendment should be passed early to promote 188bet asia development of 188bet asia energy sector as well as Việt Nam’s socio-economic development.

Cầu urged 188bet asia development of an appropriate electricity market mechanism as a foundation for electricity policies, pointing out that slowness in developing a competitive electricity market exists as a roadblock.

It was critical for Việt Nam to have market-based electricity pricing, he said. A more appropriate design for 188bet asia electricity wholesale market was also needed in 188bet asia context that Việt Nam has increasing demand for energy and has set challenging sustainability goals.

He proposed 188bet asia foundation of a separate agency in charge of reforming 188bet asia electricity market.

188bet asia National Assembly deputies at a debate on November 7, however, noted that 188bet asia draft amendment needed to be put into careful consideration.

Deputy Nguyễn Hữu Thông of Bình Thuận Province said that regulations on 188bet asia transfer of ownership of offshore wind power would be necessary to ensure national security and defence.

Deputy Nguyễn Hoàng Bảo Trân of Bình Dương Province said that in order to encourage 188bet asia development of new types of green energy such as hydrogen and ammonia, 188bet asia bill should detail incentive policies like financial support and preferential loans and taxes to encourage investors and promote technology transfer.

With a commercial electricity output of 250 billion kWh in 2023, Việt Nam’s power system ranked second in terms of scale in ASEAN and was among 188bet asia top 20 in 188bet asia world.

It is estimated that Việt Nam will need $135 billion worth of investments in electricity generation and 188bet asia electricity grid through 2030, and $399-523 billion from 2031-2050 to implement PDP8. VNS

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