To serve the goal of economic growth and towards the goal of sustainable economic development, Vietnam, like many countries in the world, requires large energy resources to serve its development. While fossil energy sources are gradually exhausted, promoting the use of renewable energy sources to meet energy needs and reducing energy dependence on foreign countries is essential. Therefore, in the article, by qualitative analysis method, the author has analyzed, synthesized and assessed the current situation of renewable energy development in Vietnam. From there, propose some solutions on using renewable energy for sustainable economic development in Vietnam.
Keywords: renewable energy, sustainable economy, use of renewable energy.
Since 2012, Vietnam has fallen into an energy shortage and has to import. Import volume in 2015 is about 6.27 million TOE (equivalent to 01 ton of oil), in 2020 about 24.9 million TOE. With Vietnam's GDP growth rate forecasted to average around 6–7 %/year in the period 2022–2030 [2], the demand for commercial electricity is estimated to increase by 8.5–9.5 %. Meanwhile, the main power sources such as thermal power, hydroelectricity have basically been fully exploited or have development limitations, leading to Vietnam being forced to depend on imported fossil fuels such as coal, oil, gas, and soon liquefied petroleum gas. In addition, the impact of climate change leads to drought, hydropower reservoirs lack water for production, and a number of thermal power projects under the revised Power Master Plan VII have been delayed, putting great pressure on ensuring water resources. Palace. Therefore, it is forecasted that by 2030, if new energy sources are not developed to balance supply and demand, the amount to be imported will increase to about 62.8 million TOE. The rate of Vietnam's energy dependence on foreign countries in 2030 will be 32.3 %.
In the international and domestic context on the requirements of sustainable economic development, the energy industry needs to find new fuel sources to replace fossil fuels. Therefore, promoting the development of renewable energy, especially wind power and grid-connected solar power, rooftop solar power, and biomass electricity to replace fossil fuels is one of the important solutions to contribute to the development of renewable energy. part of fully exploiting renewable energy sources to ensure energy security, protect the environment, respond to climate change, increase economic benefits, create jobs for workers in order to develop the economy. Sustainability is both an objective requirement and an urgent requirement.
In the content of the article, the author focuses on analyzing the current situation of renewable energy use in Vietnam, thereby proposing some solutions to promote the use of renewable energy for sustainable economic development. in Viet Nam.
Research Methods
To achieve the goal of the article, the author uses qualitative analysis method on the basis of using secondary documents and results of quantitative analysis of published works. The main research methods are as follows: Synthetic method for synthesis; Analytical methods; Comparative method to make scientific conclusions about the impact of renewable energy development on sustainable economic development.
Research background and overview
Theoretical foundations of renewable energy
Renewable energy is energy derived from the natural processes of the earth, which is not finite or unusable and has little negative impact on the environment.
According to this concept, the main forms of renewable energy today include: Solar energy; Wind energy; Biomass energy; Hydroelectric energy; Hydrogen fuel and hydrogen fuel cells; Geothermal energy; Ocean energy and other forms of renewable energy.
Solar energy: radiant and thermal energy produced by the sun in the form of electrical or thermal energy.
Wind energy: is energy generated from the process of wind using its movement to generate mechanical energy.
Biomass energy: is energy derived from organic matter from plants and recently living organisms.
In this article, the author only focuses on research on solar energy, wind energy, and biomass energy, so other types of renewable energy the author will not mention.
Theoretical foundations of sustainable development
In Vietnam, Decision No. 622/QD-TTg dated May 10, 2017 of the Prime Minister stipulating the criteria for assessing sustainable development clearly stated: Economically sustainable development is rapid development and safety, quality, requires the development of an economic system in which the opportunity to access resources is facilitated and the right to use natural resources for economic activities are shared equally. The focus is on creating common prosperity for everyone, not just focusing on benefiting a few, within the allowable limits of the ecosystem as well as without infringing on basic rights. of human. The economic aspect of sustainable development includes several basic contents: Firstly, gradually reducing the consumption of energy and other resources through saving technology and changing lifestyles; Second, changes in consumption demand do not harm biodiversity and the environment; Third, equality in access to resources, living standards, health services and education; Fourth, hunger eradication and absolute poverty reduction; Fifth, clean technology and industrial ecology (recycling, reuse, waste reduction, renewable energy) [13].
The impacts of renewable energy development on sustainable economic development in the aspects: economic growth (GDP), job creation and reduction of resource consumption.
Study overview
When researching on renewable energy development in Vietnam, there are some case studies as follows:
The study «Vietnam: Six ways to sustain renewable energy investment success» by Roman Vakulchuk et al., published by the Norwegian Institute of International Affairs (NUPI), 2020, shows six ways to maintain the success of the development of renewable energy in Vietnam, including: prioritizing renewable energy in the governance system; rationalize the regulatory framework; facilitate market entry for investors; improve transparency and communication about the investment regime; improve the electricity grid expansion planning; join with IRENA to further build renewable energy governance capacity [14].
Research on «Job prospects in the field of renewable energy» by author Lan Anh, asserts that renewable energy creates great job prospects in Vietnam, can create 700,000 jobs in the coming time, especially the solar energy industry. The article also indicates that about 1,300 workers are needed for a 1 GW solar panel factory and about 900 workers are needed for a 1 GW solar panel factory. In 2020, the annual installation of solar energy systems in Vietnam will increase to 850 MW, equivalent to about 1,500 workers across the country to work in the field of solar installation [1].
Research by authors Pham Thi Thanh Mai, Nguyen Vinh Thuy with the title «Research on some options for using renewable energy sources for power generation in Vietnam» shows that renewable energy contributes to timely response and be proactive about society's energy demand, increase the diversity and stability of power supply, reduce overload for the power industry, minimize economic loss and life pressure when the traditional grid power supply is not stable. determined. Along with that, it is reducing dependence on imported fossil fuels and energy sources to ensure national energy security. Reducing investment costs in power grid infrastructure, allowing electricity to be supplied to remote areas, seas and islands, where the national grid system has not yet reached, contributing to ensuring the social security of the people., to ensure the peace of society. Contributing to reducing greenhouse gas emissions, global warming, mitigating climate change and protecting the environment, creating job opportunities, and meeting national sustainable development goals [7].
Although, the research results show that the development of renewable energy for a country is inevitable. However, studies on the link between renewable energy use and sustainable economic development are still unclear. Therefore, in the article, the author delves into the analysis of this relationship.
The current situation of renewable energy development for sustainable economic development in Vietnam
Solar energy
Vietnam has great potential for solar energy development due to its high number of sunny hours, especially in the Central and Southern regions where the average number of sunny hours is 2,000–2,600 hours/year, while in the Northern region between 1,500–1,700 hours/year. The average daily solar radiation intensity in the North is 3.69 kWh/m2, in the South it is 5.9 kWh/m2. The average intensity of the whole country is about 4.5kWh/m2/day, equivalent to the potential of 43.9 million tons of oil/year.
Table 1
Solar radiation intensity in Vietnam
|
Regions |
Sunny hour of the year |
Average daily solar radiation intensity (kWh/m2) |
Application |
|
Northeast |
1.600–1.750 |
3,3–4,1 |
Medium |
|
Northwest |
1.750–1.800 |
4,1–4,9 |
Medium |
|
North Central |
1.700–2.000 |
4,6–5,2 |
Good |
|
Central Highlands and South Central |
2.000–2.600 |
4,9–5,7 |
Very good |
|
Southern |
2.200–2.500 |
4,3–4,9 |
Very good |
|
National average |
1.700–2.500 |
4,6 |
Good |
(Source: Vietnam Energy Magazine, 2020 [9])
According to a report of the Ministry of Industry and Trade, by the end of September 2020, the total installed capacity of solar power reached 5,829 MW. In terms of output, by the end of September 2020, electricity produced from solar power reached 7,274 million kWh. As for rooftop solar power, as of October 14, 2020, there were over 57,000 systems installed with a total capacity of 1,747 MW. According to a report by the Electricity of Vietnam (EVN), in the first 6 months of 2020, 13,784 rooftop solar power projects have been installed nationwide with a total capacity of 379.9 MWp. Accumulated to 2021, 36,161 rooftop solar power projects have been put into operation with a total capacity of 764.1MW. The output of photovoltaic projects in Vietnam has reached 5 Gigawatts (GW), far exceeding the Government's target of 1GW by 2020.
As of 2021, the whole country has 88 solar projects in operation, with a total capacity of nearly 6,000 MW, mainly concentrated in the South, in two provinces alone, Ninh Thuan and Binh Thuan, the total capacity has accounted for more than 42 %.
According to EVN's data, by December 31, 2020, the total installed capacity of solar power across the country will reach about 19,400 MW (of which nearly 9,300 MW is rooftop solar power), accounting for about 25 %. total installed capacity of the national power system.
Thus, the installed capacity of solar power sources of all types increased more than 19 times compared to the capacity set out in the revised Power Master Plan VII (Decision 428/2016/QD-TTg), while the capacity was almost most other types of power sources are still below the target threshold set out in the Master Plan. Therefore, it is necessary to draw lessons for the coming time in determining a reasonable power source structure, managing and implementing the master plan, and proposing mechanisms and policies to mobilize development resources in accordance with national orientation.
Wind energy
According to the World Bank's assessment, Vietnam has the largest wind potential of the four countries in the region, with more than 39 % of Vietnam's total area estimated to have an average annual wind speed greater than 6m/s at an altitude of 65m, equivalent to a capacity of 512 GW. In particular, more than 8 % of Vietnam's area is ranked as having very good wind potential (wind speed at 65m is 7–8 m/s), which can generate more than 100 GW. Wind energy is most concentrated in the Central Coast, the South, the Central Highlands and the islands.
Table 2
Wind potential of Vietnam at an altitude of 65m
|
Average wind speed |
Low < 6 m/s |
Medium 6–7 m/s |
Pretty high cao 7–8 m/s |
High 8–9 m/s |
Very high > 9 m/s |
|
Area (km2) |
197.242 |
100.367 |
25.679 |
2.178 |
111 |
|
Area ratio (%) |
60,6 |
30,8 |
7,9 |
0,7 |
>0 |
|
Potential (MW) |
- |
401.444 |
102.716 |
8.748 |
482 |
(Source: Vietnam Energy Association (2012) [5], Vietnam Energy Magazine.)
By the end of May 31, 2019, Since the Prime Minister issued Decision No. 39/QD-TTg amending and supplementing a number of articles of Decision 37/2011/QD-TTg on the support mechanism developing wind power projects in Vietnam, there are now hundreds of projects that have been proposed to supplement the planning; Many projects are under construction. However, up to now, only 11 projects have been put into operation, the largest of which is the Bac Lieu wind farm with nearly 100MW, the smallest is the 60MW Phu Quy wind power plant with independent grid connection (not connected to the grid. national power grid) on Phu Quy island (Binh Thuan), the rest are small-scale wind power plants with a capacity of less than 50 MW. In addition, 18 wind power plant/farm projects have been started and are under construction with a total capacity of 812 MW, of which 2 projects with a capacity of 100 MW or more are Bac Lieu 3. and Khai Long (Ca Mau), the remaining 16 projects have small-scale capacity from 20 MW to 65 MW. The number of projects under construction has nearly reached the 2020 planning target, and the number of approved projects is twice as high as the 2025 planning target. According to the report of the Ministry of Industry and Trade, calculated By the end of September 2020, the total installed capacity of wind power will reach 485 MW. In terms of output, by the end of September 2020, electricity produced from wind power reached 630 million kWh. Also during this time, many projects were completed and connected to the grid to benefit from the Government's FiT policy, leading to excess transmission capacity of the grid, causing waste [3]. [10], [11].
Biomass energy
As an agricultural country, Vietnam has a very large and diverse source of biomass raw materials from wood waste, rice husks, coffee grounds, rice straw, bagasse, urban waste and livestock waste., estimated at more than 150 million tons/year. Biomass energy is equivalent to about 43–46 million tons of oil, of which 60 % comes from wood waste and 4 % comes from agricultural waste. Besides, biomass from agricultural products or wastes, equivalent to 10 million tons of oil/year. Biogas potential of approximately 10 billion m3/year can be obtained from garbage, animal manure and agricultural waste. With this huge amount of biomass, if not treated or fully utilized, it will be a major source of pollution, causing serious impacts on ecosystems (soil, water, air) as well as human health.
Although the source of biomass in Vietnam is very diverse, currently only bagasse from sugar factories and waste from some concentrated livestock farms has a large enough source of raw materials for electricity generation. In 2019, there were 175MW of biomass electricity from 3 sugarcane factories generating electricity to the grid. According to calculations, by 2030, the whole country will have 40 million tons of sugarcane, equivalent to a generating capacity of 1,600MW.
The Government's approval of the mechanism to support the development of biomass power projects in Vietnam, notably, the electricity purchase price was adjusted to 8.47 UScents/kWh, equivalent to 1,968 VND/kWh. This is considered the current highest electricity price mechanism in Vietnam for a renewable energy with great potential in our country.
According to a report by the Ministry of Industry and Trade, as of November 2018, there were 38 sugar mills in Vietnam producing electricity and heat with a total capacity of about 352 MW. By the end of September 2020, the total installed capacity of biomass electricity reached 169 MW. In terms of output, by the end of September 2020, electricity produced from biomass electricity reached 303 million kWh [4], [6], [8], [12].
Biomass energy not only meets the demand for clean energy sources but also contributes to waste treatment, reducing environmental pollution. However, the development of this energy source faces many difficulties due to the high cost of technology and equipment.
Impact of renewable energy development on sustainable economic development in Vietnam
Developing renewable energy helps Vietnam reduce 60 % of imported fuel, as well as reduce risks from fuel price fluctuations. Investment in renewable energy also promises to create more than 465,000 new jobs in the future. This also creates development opportunities for local businesses and people throughout the country.
Renewable energy development also creates positive impacts on the environment, such as reducing air pollution, reducing greenhouse gas emissions, contributing to protecting the ecological environment and combating climate change, especially. For Vietnam, a country with the highest level of environmental pollution in the world, this is a timely action to improve the quality of life.
It is forecasted that by 2030, Vietnam's population will increase from about 98 million people today to about 104 million people, the size of our economy will also increase. Therefore, if the development of renewable energy is effective, it will meet the energy demand for sustainable economic development, create more jobs, increase income, protect the environment, and create access to electricity. equal resources for all subjects in society.
Some inadequacies in the development of renewable energy in Vietnam
The development of renewable energy in Vietnam currently has many shortcomings, preventing effective competition with traditional energy sources and preventing large-scale deployment of renewable energy. These shortcomings are reflected in a number of aspects as follows:
Regarding mechanisms and policies: The planning and supplementation of renewable energy projects is still not suitable for practical implementation; the process of reviewing, approving, adjusting and supplementing the planning is often lengthy and time consuming. The current electricity trading mechanism is still a monopoly because the competitive retail electricity market has not been operated yet. Along with that, the Electricity Law stipulates a State monopoly on electricity transmission, which limits the socialization of investment in this field. In addition, decisions on electricity purchase prices have a limited term and are valid for only about 2 years, making it difficult for investors to calculate investment efficiency when formulating projects. The lack of uniform policies covering from investigation, potential assessment, to exploitation and use; lack of information transparency, lack of effective financial mechanism for investment, management and operation of renewable power projects in remote and isolated areas; there is no clear mechanism for electricity sellers with buyers; lack of connection procedures; there is a conflict with tax regulations; The lack of a centralized focal agency with a strong enough function to operate creates many challenges in renewable energy development.
Finance: Renewable energy projects have high initial capital but lack of supporting financial institutions and investors. Currently, funding for renewable energy projects mainly depends on bank credit, while the commercial banking system does not have a specific orientation on loans for renewable energy development. done through green credit. Investors in renewable energy development have difficulty in accessing loans from domestic banks, because banks have limited medium and long-term lending rates and high lending interest rates (from 10 %/year or more). In addition, the fact that banks require a high equity ratio (from 30–40 %) has caused many difficulties in arranging finance for the project. Meanwhile, borrowing from foreign banks has a lower interest rate (about 4–5 %/year), but it is difficult for domestic investors to access it due to the requirement of a government guarantee. Along with that, the subsidies from the budget for renewable energy projects are insignificant. Another challenge is the relatively low electricity price applied to renewable energy forms while the production cost is high due to the import of all renewable energy technology equipment, which leads to lower profits. Therefore, it has not yet attracted investors to participate in the development of renewable energy.
Supporting infrastructure: The equipment of renewable energy power plants are all super-long and super-weight devices while the road and port infrastructure is still rudimentary, leading to high risks and unsafety. full; The power grid infrastructure has not been upgraded commensurately, so it cannot keep up with the rapid development of solar and wind power projects in recent times, leading to the inability to release all capacity at a given time., causing waste of power. The lack of equipment, components and spare parts also entails a significant increase in production costs, as these items need to be imported from other countries, thus having to be purchased at high prices and thus increasing costs. general fees. Moreover, the rapid development of renewable energy sources in recent years while the transmission grid system has not been synchronously upgraded has caused overload, instability and unsafety as well. as the efficiency of the power system.
Some solutions to promote the development of renewable energy in Vietnam
Firstly , building renewable energy development goals, strategies and plans based on long-term economic growth scenarios, which are concretized by the development of electricity sector development oriented master plans, set a target of how much renewable energy accounts for the total national energy supply. The formulation of the electricity sector development planning needs to be controlled and balanced within the scope, capacity and capacity structure of the power source according to each type of renewable energy, as well as the balance of the power grid system, ensuring ensure safe, continuous transmission.
Second, develop a renewable energy pricing policy in line with the socio-economic development policy and the national energy policy, ensuring transparency, bringing economic efficiency, social justice, and feasibility. in terms of finance, harmonizing the domestic and international markets, especially the price offered must be supported by a large number of people; develop a FIT subsidy policy suitable for each type of renewable energy; research and strengthen the bidding mechanism to increase the competitiveness of renewable energy projects.
Third, invest in upgrading and developing the transmission system capable of large-scale integration of renewable energy sources, in line with the objectives and speed of renewable energy development; announce the application of national technical standards to the electricity grid synchronously with renewable energy-using power sources, other works and equipment related to renewable energy; have an incentive mechanism to attract capital from all resources of the society, especially private enterprises, remove the monopoly in the electricity industry.
Fourth , speeding up the roadmap for building a renewable energy market through the formation of a direct power purchase agreement mechanism between producers and consumers, an appropriate bidding and auction mechanism in the supply chain. renewable energy supply. Develop a synchronous and interconnected energy market between the electricity, coal, oil and gas and renewable energy sub-sectors, connecting with regional and world markets.
Fifth, invest in research and development of products and fields related to the development of renewable energy, promote technology transfer activities and localize the production of renewable energy equipment to limit production of renewable energy. Depending on imported equipment, reducing costs leads to lower costs.
References:
- Lan Anh (2018), «Job prospects in the field of renewable energy», Vietnam Clean Energy magazine, No. 16/2018.
- Ministry of Industry and Trade (2020), «Clean energy — Trends and challenges».
- Quynh Chi (2019). «There are still many challenges in wind power development in Vietnam», Vietnam Association of Business Administrators Magazine.
- GGGI Vietnam (2018), «Creating attractiveness for biomass energy in the sugar industry in Vietnam».
- Vietnam Energy Association (2012), «Vietnam's wind power development potential», Vietnam Energy magazine.
- Bich Hong (2019), «Ample supply from by-products for the electricity industry», dantocmiennui.vn, https://dantocmiennui.vn/nguon-cung-doi-dao-tu-phu-pham-cho-nganh -dien/228801.html, accessed 12/18/2019.
- Pham Thi Thanh Mai, Nguyen Vinh Thuy (2014), «Study on some options for using renewable energy sources for electricity generation in Vietnam», Scientific Journal.
- Thao Mien (2019), «Vietnam gives priority to developing renewable energy», Financial Times.
- Vietnam Energy (2020), «Updated survey data of solar radiation intensity in Vietnam», Vietnam Energy Magazine.
- State Bank of Vietnam (2019), «Trung Nam Group inaugurated a wind power and solar power complex in Ninh Thuan», Banking Times.
- Mai Thang (2019), «Promoting the development of the wind power market in Vietnam», Vietnam Energy magazine.
- Prime Minister (2014), «Decision 24/2014/QD-TTg on the mechanism to support the development of biomass power projects».
- Prime Minister (2017), Decision No. 622/QD-TTg On promulgating the national action plan to implement the 2030 Agenda for Sustainable Development.
- Vakulchuk, R., and et al (2020), «Vietnam: Six ways to sustain renewable energy investment success», NUPI.
