Vietnamese government fears legal action from solar investors

The Vietnamese government is reportedly concerned about legal action from solar investors if its new power development plan does not prove ambitious enough.

Vietnam’s latest draft energy plan prepares for 8.7 GW of new solar between 2021 and 2030, but the Ministry of Industry and Trade is reportedly fearful of action by investors in another 2.4 GW of projects that have been built or approved.

VN Express International reported this week that 2,428 MW of solar capacity above what is set out in the nation’s draft power plan has been built or has secured planning consent. The news site reported that the draft version of Vietnam’s eighth power development plan, drawn up in March 2021, includes a target for 8.7 GW of new solar additions between 2021 and 2030.

According to the news outlet, some 11,164 MW of solar capacity is already in place or has been approved. And the Ministry of Industry and Trade is pushing for it all to be included in the masterplan, in order to avoid investors suing the government.

VN Express reported that the government has yet to approve the power plan, as it needs to be updated, including to reflect the net-zero-by-mid-century pledge made by Hanoi at the COP26 climate change summit in Glasgow last December. The news site said that thermal power, hydro, and liquefied natural gas (LNG) are set to dominate the Vietnamese power mix under the draft plan.

International Finance Corp. (IFC), the private-sector arm of the World Bank, recently noted that the 36 GW of clean energy generation envisaged by the October draft of the power plan would still be smaller than a planned 38 GW of coal power plants, up from 20 GW in 2020. The IFC said that Vietnam could use LNG as a bridge energy source for its power transition.

Separately, Vietnam Plus reported last week that state-owned utility Vietnam Electricity is pushing Hanoi to introduce regulations for rooftop solar. The company reportedly wants to add 1.5 GW of solar by 2025, with a focus on the poorer northern part of the country.

A feed-in tariff for grid-connected solar drove expansion in the industry, with the 8 MW the International Renewable Energy Agency (IRENA) estimated the country had at the end of 2017 rising to 105 MW a year later. The cumulative total hit 4.99 GW in 2019 and 16.7 GW in 2020.

The IFC has criticized the lack of an auction system to follow up the FIT program. Its assessment appears to be borne out by IRENA’s estimate that no new grid solar capacity was installed in 2021.

This post appeared first on PV Magazine.

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