A delegation from the Ministry of Industry and Trade, AFD, Team Europe, EVN and provincial authorities visits the site of the Ialy Hydropower Plant extension project. — VNS Photos Khánh Chi

GIA LAI — The ongoing expansion of the Ialy Hydropower Plant in the Central Highlands region is facing several issues, including unresolved land rights problems, affecting the project's completion.

The expansion project is located in Sa Thầy District, Kon Tum Province and Chu Pah District, Gia Lai Province, and started in June 2021.

Two additional turbines with a total capacity of 360MW to extend the current Ialy Hydropower Plant capacity are planned to be installed and in operation by the end of 2024. The 360MW of renewable energy will be expected to connect to the distribution grid, replacing fossil production (estimated at 220GWh/year).

With a total investment of 242 million euros (about US$252 million), the project is financed by a non-sovereign loan of 74.7 million euros from the French Development Agency (AFD), which is used to pay for hydromechanical and electromechanical equipment. The rest will be sourced from counterpart funds and domestic loans.

An EVN report released this month shows that despite the impacts of COVID-19 and the Ukraine-Russia conflict, which has led to drastic increases in input prices, including petrol and steel, some works finished one to three months ahead of schedule.

Deputy head of the Power Project Management Board 2 Nguyễn Đức Minh said all works related to compensation and site clearance of the land outside the natural forest area had been completed.

However, he said, the natural forest project site has yet to be handed over to the investor thanks to unresolved procedures concerning the changed purpose of the forest land.

According to the EVN's Power Project Management Board 2, 2.46ha of natural forest (1.02ha located in Gia Lai Province and 1.44ha in Kon Tum Province) will be used for the expanded Ialy Hydropower Plant. The Prime Minister has agreed with the changed purpose of the forest land to facilitate the project.

"A Gia Lai Province's People's Council working group monitoring the changed purpose of the forest land for the expansion said there is not enough basis for implementation because the Prime Minister hasn't approved the national forestry planning for 2021-2030," said Minh.

"This has affected the investor's borrowings, flooding prevention and control in 2023 and the construction of the 500kV connection line."

The location where two additional turbines with a total capacity of 360MW are planned to be installed.

After meeting with Gia Lai authorities during a field trip to the expanded Ialy Hydropower Plant site last week, Deputy Minister of Industry and Trade Đặng Hoàng An said: "The provincial authorities have acknowledged the necessity to resolve the problem. If not, the project will be delayed."

As planned, the first turbine will be operational in June 2024 and the second three months later.

"The project management board, EVN, must immediately report to the local Department of Agriculture and Rural Development to work out necessary procedures to untie existing problems," said the deputy minister. "The project progress has been going well, so there is no reason for the Power Project Management Board and EVN to miss any deadlines."

"If the project is delayed for one year, it means we lose some VNĐ232 billion of industrial production and the locality will potentially miss out on tens of billions of đồng in tax revenue," said An.

A new water intake gate has been built to serve the expanded Ialy Hydropower Plant.

The extension of the Ialy Hydropower Plant is expected to help increase EVN's production capacity from renewable resources to meet the growing demand for electricity while reducing the greenhouse gas emission, contributing to the Vietnamese Government's renewable energy development goals and promoting the adoption of international health, safety and environmental standards.

Việt Nam's electricity demand is forecast to increase by 8-10 per cent per year over the 2016-30 period.

"We believe that the future energy in Việt Nam is renewable," said EU Ambassador to Việt Nam Giorgio Aliberti, who joined the deputy trade minister during the site visit. "Gia Lai Province is potential for energy development, as besides hydropower plants, there are solar energy and biomass."

The ambassador said he understood the significance of land-related issues in any project and the determination to address them by relevant authorities. However, the project can't be delayed for long, so solutions must be found.

He said the EU is working closely with partners like France, AFD and Team Europe members to share experience and provide technical assistance to help Việt Nam with its green transition.

Director of AFD in Việt Nam Hervé Conan said Gia Lai Province is one of the localities accommodating energy cooperation projects between France and Việt Nam. With three ongoing energy projects in the province, especially the Ialy Hydropower Plant extension project, he said he expected obstacles to be removed soon so the plant will enter into full operation by the end of 2024.

Deputy Chairman of Gia Lai Province's People's Committee Hồ Phước Thành said: "The province fully supports the extension project and has authorised the agriculture department to work with competent parties to deal with existing shortcomings." — VNS