Dual opportunity for Việt Nam in offshore wind industry development

March, 17/2023 - 08:21
Offshore wind is a great dual opportunity for Việt Nam: an opportunity to deliver green and cost-efficient energy for the continued economic development of the country and at the same time support Việt Nam in achieving its COP 26 net-zero by 2050 commitment.
La Gàn offshore wind power project. Việt Nam has many favourable conditions to create a thriving offshore wind industry. — Photo vietnamplus.vn

HÀ NỘI — Offshore wind is a great dual opportunity for Việt Nam, helping deliver green and cost-efficient energy for the continued economic development of the country and at the same time support Việt Nam in achieving its net-zero by 2050 commitment made in COP 26.

Nicolai Prytz, Denmark ambassador to Việt Nam, made the statement at the workshop “Promoting Việt Nam’s Offshore Wind Power Development: International Best Practices and Policy Recommendations” held in Hà Nội on Thursday.

Việt Nam has many favourable conditions to create a thriving offshore wind industry: a long coastline, ample wind resources, relatively shallow seabed areas suitable for fixed foundations, and a well-established supply chain that can be used almost immediately or transition relatively quickly to support many parts of the construction process and associated infrastructure needed to develop and construct an offshore wind farm.

Offshore wind, which can supply huge amounts of green electricity at attractive prices while creating new jobs and attracting investments, will play a key role in the future energy mix in Việt Nam.

Reports from the event showed that in recent decades, Việt Nam has experienced average annual growth rate of around 7 per cent in GDP, which has led to a significant increase in energy consumption as well as in associated CO2-emissions. It is key for Việt Nam that the country is able to decouple economic and energy consumption and turn its energy composition into a more sustainable energy system by investing in renewable energy.

Nguyễn Đức Hiển, deputy head of the Party Central Committee’s Economic Commission, said Việt Nam has many potentials and opportunities to develop wind energy. Thanks to the capacity and experience of building offshore and marine works as well as supporting logistics systems of the oil and gas industry, Việt Nam could make good use of its internal resources to develop the offshore wind power industry associated with the value chain of support industries and logistics services in the coming years.

By the end of 2021, the total registered capacity of offshore wind power investment in Việt Nam was about 154GW. The draft National Power Development Plan VIII (PDP 8) sets a target to develop about 16,121MW of onshore and nearshore wind power and about 7,000MW of offshore wind power by 2030. By 2045, the offshore wind capacity is expected to reach approximately 64,500MW.

Việt Nam identified the development of offshore wind power as a breakthrough solution in energy transition, ensuring national energy security. However, because offshore wind power development is a new field, there are still many issues related to legislation, planning, investment mechanism, standards and regulations.

Hiển also pointed out the big problems that face the offshore wind power industry in Việt Nam including technical and technological complexity; large and long-term capital. At the same time, many issues need to be clarified such as planning, mechanism, construction investment policy, leasing regulations, licensing, standards, operating regulations, electricity price mechanism and electricity purchase contracts and regulations on operation of power system, seaport system, and development of supply chains.

Ambassador of Denmark Nicolai Prytz said: “Being one of the strong and long supporters of Việt Nam’s transformation to a green and sustainable energy sector, Denmark is looking forward to a clear and consistent regulatory framework, which is essential for the development of the offshore wind industry, starting with the approval of the PDP 8 and exclusive offshore survey rights.”

Denmark has been a pioneer and a world leader in offshore wind energy since 1991 when Denmark commissioned the world’s first offshore wind energy farm. Today, Denmark also takes lead in reducing the cost of offshore wind power to make it one of the most competitive forms of renewable energy. This is vital and a great incentive for the rapid and widespread growth of the industry in Việt Nam.

One of the key recommendations of the report “Input to Roadmap for Offshore Wind Power Development in Việt Nam” jointly prepared by the Danish Energy Agency and World Bank is that the Government of Việt Nam should award large-scale demonstration projects to be commissioned in phases in order to kick-start the sector. It is now the time for the Government to take action if the target of having 7GW offshore wind capacity installed by 2030 as set out in the draft PDP8 is to be met.

Henrik Scheinemann, Co-CEO of Copenhagen Offshore Partners, said: "It is critical that Việt Nam should focus on instigating this proven and highly effective renewable energy industry and learn from other markets that have progressed well during their journey in order to deliver an offshore wind industry that is well-suited to the country’s needs and skills."

"It is clear that Việt Nam can and will get this industry established. Now is the time to press forward and allow pilot projects to be instigated, a clear regulatory framework to be delivered, and for developers to share learnings to build up the local supply chain and address Việt Nam’s growing thirst for green energy," said the CEO.

The workshop, co-organised by the Việt Nam Central Economic Commission and the Embassy of Denmark in Hà Nội, aimed at creating a forum for open dialogue and discussion among Vietnamese ministries and agencies with local and international organisations, experts, and businesses to share international experience and propose relevant policies for Việt Nam to develop its offshore wind power industry. — VNS