Vietnam urged to start route-to-market process for offshore wind power goal

Vietnam urgently needs to embark on a route-to-market strategy to expedite the installation of over 6 gigawatts of offshore wind capacity by 2030 in the country as targeted in its latest power development plan, says the Global Wind Energy Council (GWEC).

To date, Vietnam has not initiated any true offshore wind projects and has only developed intertidal wind projects situated in close proximity to the shore; thus the target of installing 6 GW of offshore wind capacity by 2030 presents considerable challenges, the council says in its latest report.

GWEC highlighted that an offshore wind project needs six to eight years from greenfield to commercial operation date (COD), which was adopted by the Ministry of Industry and Trade (MoIT).

The MoIT estimates that the first pilot offshore wind project may not be completed until 2032.

“Consequently, connecting the first generation of offshore wind projects by 2030 necessitates the immediate establishment of policy and regulatory frameworks,” the council notes.

It elaborates that key components of the route-to-market process include implementing a simple remuneration mechanism for initial pilot projects; developing a streamlined permitting process to ensure timely implementation; developing a robust Marine Spatial Planning (MSP) and site allocation approach; defining a clear timeline for auction implementation; enhancing Power Purchase Agreement (PPA) bankability to attract international finance; and upgrading grid infrastructure for seamless offshore wind integration.

GWEC points out that recent developments signal significant progress in advancing offshore wind energy development in Vietnam. These include the submission of Marine Spatial Planning to the National Assembly; an MOIT draft proposal for the pilot mechanism of offshore wind projects, which includes the proposal for the State Energy Steering Committee (established in November 2023) to oversee the offshore wind projects.

Finally, the national Power Development Plan VIII (PDP VIII) implementation plan was issued in April 2024, determining regional allocations for offshore wind development, and the Draft Law on Electricity includes regulations for offshore wind power development.

Considering that the regulatory framework to support offshore wind development under PDP VIII is still underdeveloped, as well as the six-eight-year project development lead time, GWEC Market Intelligence believes that no real offshore wind development will take place until route-to-market policies and potentially new law(s) are in place.

GWEC expects Vietnam to miss its 2030 offshore wind target.

In recent years, GWEC has actively engaged with industry stakeholders and the Vietnamese government, facilitating dialogue through regular taskforce and working group meetings, as well as closed-door bilateral discussions. These efforts have been instrumental in gathering industry feedback and sharing crucial insights for advancing offshore wind development in Vietnam.

GWEC and its members will continue to work with governments to make this workable for the whole offshore wind industry, it adds.