Petrovietnam Technical Services Corp. (PTSC) and Sembcorp Utilities Pte. Ltd. (SCU) signed a joint development agreement for investment in offshore renewable energy in Vietnam and export of green electricity to Singapore on February 10 during Prime Minister Pham Minh Chinh’s official visit to the island state. PTSC CEO Le Manh Cuong elaborates on the deal during an interview with the government portal.
Can you elaborate on the agreement between PTSC and SCU regarding investment in offshore renewable energy in Vietnam and power exports to Singapore?
As part of the two countries’ intention to set up partnerships in the digital economy and green economy, Singapore’s state-controlled Sembcorp Industries and Vietnam’s state-owned Petrovietnam have assigned SCU and PTSC to implement the deal. The two sides had discussed and signed a joint development agreement in November 2022 in preparation for the announcement on February 10.
Per the agreement, PTSC and SCU will invest in a 2.3-GW offshore wind farm in Vietnam and export electricity to Singapore via an undersea high voltage cable.
What challenges will the project face given the distance between Vietnam and Singapore?
This is a major challenge, but many similar projects around the world have been deployed, such as the 720-kilometer North Sea Link subsea interconnector, with a capacity of 1,400 MW, linking the electricity networks of the UK and Norway.
PTSC can overcome these issues. The firm will install sufficient energy storage systems (ESS) and apply other technical solutions to reduce energy loss during transmission. After the signing of the deal, PTSC will hire international consultants for research and deployment of the project.
In addition to technical issues, the project will pass through waters of other countries. How will this be handled?
At the moment, ASEAN nations are deploying a program to connect their power grids, and electricity exports from Vietnam to Singapore are part of this program. Besides, Singapore is part of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP) and has already imported electricity from Laos via the grid.
In line with fast-growing energy transition, nations’ demand for clean energy will keep increasing. Meanwhile, Vietnam is the only ASEAN nation with large-scall offshore wind energy sources of 599 GW per the World Bank’s assessments.
The project is an opportunity for relevant sides and also a chance for the export of Vietnam’s offshore wind power to other nations, reaping benefits for countries and boosting the efficiency of the investment.
The long distance between the two countries may hike the investment cost and impact the competitiveness of the energy?
In order to achieve its net-zero carbon emission goal in 2050, Singapore plans to import 30% of its electricity from clean sources from 2035 and apply progressive carbon taxes.
Due to rising problems in arranging capital for traditional electricity projects, prices of traditional power will keep on rising. Meanwhile, green energy is the only solution to carbon credit and is in demand for many businesses, such as Lego in Vietnam. The demand for green energy will rapidly grow while businesses and countries like Singapore are willing to pay fairly for this energy source.
Can you brief on the project’s progress?
An offshore wind power project normally takes at least five-seven years to reach commercial operation. PTSC has recently submitted its request for a survey to the Ministry of Natural Resources and Environment and the southern coastal provice of Ba Ria-Vung Tau.
If the authorities provide suitable legal support and permit an early survey and use of waters for electricity exports, PTSC is looking at commercial operation starting in 2030.