Int’l agencies outline transition pathways for Vietnam’s coal-fired power plants

International organizations and financiers have gathered in Hanoi to discuss transition options for a number of coal-fired power plants in Vietnam as the country is moving to meet its net-zero emissions target by 2050.

The United Nations Development Program (UNDP) Vietnam hosted a technical meeting on Thursday to look into the transition from coal-fired power generation to sustainable alternatives.

The event is aimed to provide updates on the transition of coal-thermal power plants, international experience on Best Available Technology (BAT), costs, benefits, and potential impacts of the transition, and discuss options for the decommissioning, repurposing, and refurbishment of different types of coal-fired power plants.

The meeting also helped to facilitate connections between project developers/ power plant owners with potential investors and financial institutions to explore opportunities for future investment in coal phasing out.

It drew the participation of critical stakeholders, including members of the International Partners Group (IPG) and Glasgow Financial Alliance for Net Zero (GFANZ), the Institute of Energy under the Ministry of Industry and Trade, state-owned energy companies, coal-fired power plant operators, financial institutions, banks, development partners, and NGOs.

“Our dependence on coal-fired power generation poses significant challenges to sustainable development and energy security. Phasing out unabated coal is a must not a choice for decarbonizing Vietnam’s economy and achieving Net-zero emissions,” stated Ramla Khalidi, UNDP Vietnam’s resident representative.

She also emphasized the importance of concerted efforts to mitigate these challenges and the need for a just and inclusive transition.

“A sizeable number of workers employed directly or indirectly by coal mining activities, transportation, and power generation, particularly across remote areas, may be impacted by a coal phase-out. It is important to provide support on re-training and re-skilling for affected workers and communities, and essential to ensure their engagement and benefiting from the transition process,” she said.

Case studies

Experts from the Asian Development Bank (ADB), World Bank, the Institute of Energy, and German development agency GIZ discussed the findings of comprehensive case studies. The studies explored viable transition pathways for Vietnam’s major coal-fired power plants, namely Pha Lai in Quang Ninh province, Cao Ngan in Thai Nguyen province, and Van Phong in Khanh Hoa province.

They assessed the potential impacts, costs, and benefits of various energy conversion options. Strategies such as biomass co-firing, LNG conversion, and the integration of renewable resources were evaluated alongside innovative technologies like Battery Energy Storage Systems (BESS) and Carbon Capture, Utilization, and Storage (CCUS).

David Elzinga, principal energy specialist and Energy Transition Mechanism (ETM) team leader, ADB, presented the experience with Indonesia and the Philippines in ETM. Le Hoang Anh from the World Bank shared their initial research results for repurposing of Ninh Binh coal-fired power plant.

The report on Pha Lai includes two coal-fired thermal power plants – Pha Lai 1 and Pha Lai 2. Pha Lai 1, with a capacity of 440 MW, is the most long-standing operational thermal power plant, which has been in operation for approximately 40 years. It is on the list of decommissioning in compliance with the Power Development Plan VIII (PDP8).

The study proposed the possibility of integrating suitable transition technology to cleaner technology, such as flexible gas turbine units combined with BESS and solar power or BESS combined with solar power and synchronous condenser (SynCON).

Meanwhile, Pha Lai 2, with a capacity of 600 MW and 23 years of operation, also needs to change. Some pathways considered for Pha Lai 2 include ammonia co-firing or flexible gas turbines, BESS combined with flexible gas turbines and solar power, or BESS combined with gas turbines and SynCON. These strategies are not only environmentally beneficial by significantly reducing greenhouse gas emissions but also crucial for enhancing energy security and sustainability in the region.

In the case of Cao Ngan with a capacity of 100 MW, its location is in downtown Thai Nguyen city, thus stricter environmental standards would be required. The study emphasized the plant’s capacity for integration with renewable energy sources.

It pointed to the potential for a seamless blend of solar and wind energy into the existing power generation system, enhanced by innovative BESS and CCUS technologies. This approach could be a model for balancing energy production with environmental conservation.

The Sumitomo Corporation-invested $2.6-billion Van Phong 1 power plant, which came into operation earlier this month, is at a convenient location for integrating solar PV, co-firing biomass, and coal to change to biomass firing completely.

The analysis delved into various transition options, including the pioneering use of small-scale nuclear power and the repurposing of the plant to accommodate emerging technologies. The plant is near the Phu Khanh oil reservoir, which can be used for CO2 storage and isolation. Such transformative measures align with Vietnam’s emissions reduction goals and promise to invigorate local economies and spur technological innovation.

However, legal issues related to the BOT contract will arise with any proposed solution, requiring renegotiation.

Participants also discussed international best practices, technological advancements, and financing models to support Vietnam’s energy transition at the meeting.

As Vietnam heads towards achieving net-zero emissions by 2050, the outcomes of the meeting are expected to significantly contribute to shaping a just and equitable energy transition in Vietnam and beyond.