May 19, 2023
Vietnam Approves New Power Development Plan

On May 15, 2023, Vietnam’s Deputy Prime Minister Tran Hong Ha signed Decision No. 500 of the Prime Minister approving the National Power Development Plan for the period 2021-2030, with a vision to 2050 (“PDP VIII”), following extensive public consultations and multiple rounds of review since the first draft version was circulated in 2021. The plan was approved in the context that in the past few years, a number of large power projects have been behind schedule for operation, while new projects have not been able to be implemented due to waiting for additional planning.

PDP VIII is the master plan for the development of the power source and transmission grid at 220kV or higher; services in renewable energy and new energy in Vietnam; and works connecting the power grids of Vietnam and neighboring countries.

We set out below some quick updates regarding PDP VIII.

1. Development Targets

Key development targets are summarized in the table below:

Investors in coal, domestic gas, and LNG projects may need to have a conversion plan ready given the 2050 targets to convert to other sources of energy.

2. Solar Projects

A list of 27 solar power projects that were planned for the period of 2021-2030 but which have not been assigned to investors are not allowed to be deployed but can be considered after 2030, except in the case of deployment in the form of self-production and self-consumption (Appendix IV). These projects represent 4,136.25 MW of capacity that will be left on the sidelines until 2030.

3. Hydropower Projects

A list of 14 potential hydropower projects can be considered if economic and technical conditions allow for more hydropower development (Appendix III). These projects represent 1,244 MW of capacity that can be added to the hydropower targets for 2030.

4. Projects Prioritized for Investment

Certain important projects will be prioritized for investment (Appendix II), including:

  • 13 LNG-fired power projects are expected to be completed by 2030, and two projects by 2035.
  • Six coal-fired power projects are expected to be completed by 2030.
  • Five coal-fired power projects are behind schedule, facing difficulties in changing shareholders and arranging capital. These projects are expected to be completed by 2030.
  • Four cogeneration power sources and power sources using residual heat, blast furnace gas, and by-products of technological lines in industrial facilities are expected to be completed by 2030, and three projects by 2035.
  • 10 domestic gas-fired power projects are expected to be completed by 2030.
  • 25 medium and large hydropower sources are expected to be completed by 2030.
  • Two pumped storage hydropower plants are expected to be completed by 2030, and two plants by 2035.

5. Electricity Importation

Vietnam will build out 500kV and 220kV transmission lines connecting to Laos to import electricity from power plants in Laos according to the memorandum of understanding signed between the two governments.

6. Total Investment Capital

For the period 2021-2030, the total investment capital for power sources and grid systems is targeted to be USD 134.7 billion, in which investment capital for power sources will be USD 119.8 billion (averaging USD 12 billion per year), and for grid systems will be USD 14.9 billion (averaging USD 1.5 billion per year).

For the period 2031-2050, the total investment capital for power sources and grid systems is targeted to be USD 399.2-523.1 billion, in which investment capital for power sources will be USD 364.4-511.2 billion (averaging USD 18.2-24.2 billion per year), and for grid systems will be USD 34.8-38.6 billion (averaging USD 1.7-1.9 billion per year).

7. Next Steps

The Ministry of Industry and Trade will submit the Implementation Plan for PDP VIII to the Prime Minister in June 2023 and formulate and submit to the government the amended Law on Electricity and the new Law on Renewable Energy for submission to the National Assembly in 2024. PDP VIII also specifies that a direct power purchase agreement (DPPA) pilot program will be issued but is silent on the timeline.

For more details on PDP VIII, or on any aspect relating to Vietnam’s energy sector, please contact Tram Ngoc Bich Nguyen at [email protected], Duong Duy Nguyen at [email protected], or Duc Minh Pham at [email protected].


Related Professionals
Duc Minh Pham
+84 28 6284 5680
Duong Duy Nguyen
+84 28 6284 8184
Tram Ngoc Bich Nguyen
+84 28 6284 5668