Vietnam must avoid power cuts next year: PM
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Prime Minister Vietnam Nguyen Xuan Phuc has ordered agencies to ensure that the country won’t suffer power shortages in 2019. The Prime Minister has communicated this to relevant agencies several times, Mai Tien Dung, Minister and Chairman of the Government Office, said at the government’s regular press conference on Monday.
The communiqués have instructed the agencies to ensure that there’s no electricity shortage for both industrial and domestic uses, emphasizing they would be held responsible for failures, Dung said.
The PM has also tasked relevant agencies with definitively resolving the ongoing issue of coal shortage for thermal power plants, which Vietnam Electricity (EVN) has warned could lead to power cuts early next year.
The national power utility said in a recent report to Deputy Prime Minister Trinh Dinh Dung that the country will need over 54 million tons of coal for electricity production next year, of which 43.4 million tons will come from domestic production and 10.68 million tons will be imported.
But the country’s only two suppliers, Vietnam National Coal-Mineral Industries Corporation (Vinacomin) and the North-Eastern Company (NECO) under the Ministry of Defense, will only be able to produce 37.21 million tons of coal next year, 6.19 million tons lower than estimated demand, EVN said.
Speaking at the press conference, Deputy Minister of Industry and Trade Do Thang Hai said a total of four different electricity supply plans have been drafted, all of which designed to ensure there would be no power shortages next year.
However, in certain cases, Vietnam would still need to produce 2-7 billion kWh of electricity from expensive oil-powered generators.
“If we want to have enough electricity then we must increase the production of electricity by oil, which would be more expensive,” he said, asking consumers to make plans to save electricity.
“However, in certain cases, Vietnam would still need to produce 2-7 billion kWh of electricity from expensive oil-powered generators.”
Regarding the issue of coal shortage, Hai asserted that Vinacomin and NECO have both supplied enough coal for thermal power plants as committed.
“The two major coal suppliers have tried their best. If coal from domestic sources is not enough to supply [thermal power plants] then we will import more,” he said.
The deputy minister also said a scenario for regulating electricity prices next year would be reported to the government later this month.
“The electricity price for next year is being carefully considered and the scenario is being built in accordance with regulations, including factoring in the effect on inflation,” he said.
Vietnam currently relies largely on hydropower and thermal power plants for its electricity needs. However, its hydropower potential is almost fully exploited and its oil and gas reserves are running low.
Thermal energy is expected to account for over 48 percent of the country’s power production next year.
Vietnam, one of Asia’s fastest-growing economies, has been struggling to develop its energy industry, and its heavy reliance on non renewable sources could prove problematic in the future, experts say.
World Bank country director for Vietnam Ousmane Dione said at a recent forum that Vietnam will need to raise up $150 billion by 2030 to develop its energy sector; that electricity demand in the country will grow by about 8 percent a year for the next decade.
Questions & Answers
Q.What is the primary reason for the potential power shortages in Vietnam?
What is the primary reason for the potential power shortages in Vietnam?
The main issue is a projected shortage of coal for thermal power plants. Domestic suppliers are expected to produce 6.19 million tons less than the estimated demand for next year, potentially leading to power cuts.
Q.How does the Vietnamese government plan to ensure sufficient electricity supply despite the coal shortage?
How does the Vietnamese government plan to ensure sufficient electricity supply despite the coal shortage?
Four electricity supply plans have been drafted, aiming to avoid shortages. If necessary, Vietnam may produce 2-7 billion kWh from expensive oil-powered generators and plans to import more coal to meet demand.
Q.What is the long-term outlook for Vietnam's energy sector given its current reliance on non-renewable sources?
What is the long-term outlook for Vietnam's energy sector given its current reliance on non-renewable sources?
Experts suggest that Vietnam's heavy reliance on non-renewable sources like hydropower and thermal power, with declining oil and gas reserves, could become problematic. Significant investment of up to $150 billion is needed by 2030 to develop the sector.
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