Vietnam has taken the lead in Southeast Asia’s solar photovoltaic market with the largest installed capacity in the region, said Rishab Shrestha, a specialist working for Wood Mackenzie.
Solar installation progress in ASEAN (2010-2019) - Photo: The ASEAN Post
According to research by Wood Mackenzie, the nation’s cumulative solar photovoltaic installation will hit 5.5 GW this year, making up 44% of Southeast Asia’s total capacity, compared to just 134 MW (or 0.134 GW) in 2018.
The country is aiming to boost its power output produced by renewable energy to about 23% by 2030, according to Andreas Cremer, director of energy and infrastructure for Europe, Middle East and Asia at German investment firm DEG.
The power development plan of Viet Nam is evolving continuously, Cremer made that statement at the Asia Clean Energy Summit last week. The Vietnamese Government’s renewables and hydro targets for its energy mix was raised from 16% in 2011 to 23% in 2016.
With massive installations also come curtailment problems. The installed capacity in Viet Nam’s key provinces has already exceeded the grid capacity by 18%. The approved capacity for the central provinces of Ninh Thuan and Binh Thuan amounts to 5 GW, more than double the grid usable capacity.
Grid expansion is expected to increase grid capacity for solar in key southern provinces by about 25% in 2020 compared to 2019. However, more investment is needed to address curtailment concerns, added Shrestha.
Feed-in tariff for solar power plants in VN
Earlier in July this year, Prime Minister Nguyen Xuan Phuc had tasked the Ministry of Industry and Trade to review a media report saying many solar power plants are operating under capacity due to national grid overload.
Viet Nam witnessed a boom in construction of solar power plants thanks to the introduction of the Prime Minister’s Decision No.11/2017/QD-TTg on promoting solar power development projects in Viet Nam.
Under the decision, all solar power plants across the country shall enjoy a feed-in tariff (FIT) of 9.35 cents per kilowatt-hour for a period of 20 years if they begin commercial operation before June 30, 2019.
In the first six months of 2019, nearly 90 plants with the combined design capacity of approximately 4,500 MW were connected to the national grid, accounting for 10% of the national total capacity.
One of the biggest challenges for the power sector is to implement transmission projects to absorb designed power capacity of solar power plants as this process averagely takes about 3-5 years./. VGP
The purchase prices of solar power will be set through auction, instead of using a common price for the entire country, or different prices for different thermal radiation zones, according to officials.
The tardiness in upgrading electricity transmission networks is expected to cause big losses to solar power plants in Ninh Thuan.