Thermal power still the "backbone" to help ensure energy security

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Dr. Nguyen Manh Hien.

To alleviate the shortage of electricity in the near future, one of the key solutions proposed by the Ministry of Industry and Trade is to promote development of renewable energy such as wind and solar power. Is this orientation reasonable and feasible?

In recent years, the development of wind and solar power has been oriented to encourage development of renewable energy so it has an attractive price, typically for solar power is 9.35 cents/kWh. Renewable energy brings many environmental benefits, because of preferential prices, private investors are investing heavily. According to the seventhMaster Plan, in the south there are a number of imported coal-fired power plants and a number of power plants running on Block B gas in the southwest, which are behind schedule and cannot be put into operation in 2019 and 2020. Therefore, even though the sun is only in the daytime, the wind is not there for many hours, and not as stable as coal and gas power plants, but it will also contribute to solving the short-term power shortage.

According to Decision 13/2020/QD-TTg on incentive mechanism for solar power development in Vietnam, the new solar power price is 7.69 cents/kWh, respectively, for floating solar power projects; 7.09 cents/kWh with solar PV and 8.38 cents/kWh with rooftop solar power systems. These rates are significantly downcompared to 9.35 cents/kWh previously applied. Is this enough to attract investors to continue investing in solar power projects?

It must be confirmed that the price of 9.35 cents/kWh is too attractive. With the current price reduction, investors, although not as profitable as they used to be, still have profits. The new price is still a favourable price, enough for investors to be profitable. However, investors must also calculate more closely, ensuring costs. In addition to the price, the Government still has other incentives, such as enterprises investing in renewable energy to borrow bank loans with lower interest rates than other types of investment.

In solar power, I think roof voltage should be particularly encouraged. This type does not need a load grid like 500 kV or 220 kV. Investors who do not need to have too great potential can still invest, tens or hundreds of megawatts of investment costs are not too much, and grid development is not serious.

In addition to renewable energy, promoting imports of electricity from China is also one of the solutions proposed by the Ministry of Industry and Trade to offset the shortage of electricity in the next few years. What is your view on this alternative?

Vietnam lacks electricity in the south, not the north. Currently, the north is sendingelectricity to the south, so if the import increases in China, the north will have to load more electricity to the south. I think that instead of China, it is better to increase imports from Laos. Wind power imported from Laos ischeaper than wind and solar power in Vietnam. However, it is not true that Vietnam's electricity price is lower than its domestic price. They have calculated all costs to get the electricity price right.

Thermal power projects in the PDP VII have been delayed quite a lot, the main cause leading to Vietnam's coming electricity shortage. How willthe electricity planning VIII that the Ministry of Industry and Trade is developing avoid the difference between planning and implementation?

From Electricity Planning VI onwards, the Government assigningenergy groups to be the source of electricity is not feasible. For example, the Vietnam Oil and Gas Group (PVN) can only use gas for electricity, but it also makes coal for electricity. PVN has to buy coal from the Vietnam Coal-Mineral Group (TKV) and sell electricity to Vietnam Electricity (EVN), standing in the middle, so it cannot have cheap and effective electricity prices.

Previously, only the EVN made electricity, later, they wanted to reduce the burden on the electricity industry, so even corporations like PVN andTKValso participated in investing in electricity. The handover of the power source makes the investment cost go up andbehind schedule. For example, the Thai Binh 2 Thermal Power project invested by PVN is still behind schedule and the investment cost is more expensive than Thai Binh Thermal Power project invested by the EVN.

Governments should not assign power generation projects to their own advantage. For example, any corporation in the field of gas should only act as gas; in the field of coal, we should only make coal power.

In addition, the key point is implementation monitoring. For example, the Ministry of Industry and Trade must have an "iron hand" to investigate, closely monitor and supervise the establishment of the executive board, and must drastically review the progress of power projects of corporations. If any project is behind schedule, there must be a proper handling mechanism and punishment.

To ensure energy security in the long term is the power source playing a key role for Vietnam?

I think that in the orientation to 2025-2030, thermal power still accounts for the largest proportion in the power source structure (including coal and gas power). The share of electricity after thermal power is hydroelectricity, followed by renewable energy. In renewable energy, attention should be paid to biomass electricity from bagasse, rice husk andstraw.

In addition, in my opinion, the restart of nuclear power projects should also be considered. Vietnam is expected to facea power shortage in 2022-2023. Building a nuclear power plant takes about 6-7 years. If at the present time we immediately restartedthe suspended projects it wouldnot be timely enough to make up for the shortage of electricity. That is not to mentionthere is no capital right after developing nuclear power again.

After 2030, Vietnam will have serious energy shortages. Meanwhile, coal must be imported. Hydroelectricity has also been fully exploited. We are also about to import liquefied petroleum gas. If Vietnam continues to not develop nuclear power, Vietnam will have to import a lot of liquefied gas and coal. That means energy security is greatly limited. To ensure national energy security and contribute to combating global climate change, that is, reducing greenhouse gas emissions, it is advisable to keep nuclear power development sites in NinhThuan province, after 2030 to continue to grow.