Yes, no: trade ministry turns around, says nix coal-fired power

By Tri Duc
Sat, October 15, 2022 | 7:10 am GMT+7

The Ministry of Industry and Trade has proposed that five thermal power projects with a total capacity of 6,800 MW be excluded from the national power development plan VIII (PDP VIII).

In its latest proposal to the government, the ministry explains the sudden turnaround by citing problems in implementation and capital arrangement. It now suggests that the thermal plants be replaced with other projects that tap wind and biomass power.

The ministry had insisted late last month on the inclusion of five projects in the PDP VIII for the period 2021-2030, with vision until 2050.

Quang Ninh thermal power plant in Quang Ninh province, northern Vietnam. Photo courtesy of EVN.

Quang Ninh thermal power plant in Quang Ninh province, northern Vietnam. Photo courtesy of EVN.

The five plants are: the 600 MW Cong Thanh; 1,200 MW Quang Tri; 2,000 MW Song Hau 2; 1,200 MW Nam Dinh 1; and 1,800 Vinh Tan III.

Investors for the Cong Thanh have informed the ministry that they are not in a position to continue with the coal-fired project. Thanh Hoa province has proposed that the Cong Thanh project be converted to an LNG-fired power plant with a total capacity of 1,500 MW, up from the originally planned 600 MW.

Thailand’s state utility EGATi will abandon its $2.3 billion project in Quang Tri province, Thailand’s Ministry of Energy confirmed last Thursday.

Malaysia’s Toyo Ink Group Berhad, the investor for Song Hau 2, failed to arrange capital for the project before the June 24 deadline as committed under the BOT contract. The investor has given Hau Giang province VND343.25 billion ($14.22 million) for land clearance and resident resettlement support, but still owes VND365.5 billion.

The investor for the 1,200 MW Nam Dinh 1 plant is the Nam Dinh First Power Company Limited, a joint venture between Saudi Arabian ACWA Power and the South-Korean conglomerate Taekwang Power. Currently, negotiations for the government guarantee and undertaking (GGU) are not yet complete. Besides, ACWA Power has withdrawn from the project without any replacement.

Meanwhile, Japan’s Mitsubishi Corporation and Hong Kong-based CLP Holdings Ltd. have withdrawn from the Vinh Tan 3 project after adopting policies of making no investments in coal-fired power.

Vietnam currently runs 39 coal-fired thermal power plants with a total capacity of 24,674 MW, the ministry said. In addition to the five above-mentioned projects, there are seven under construction with a combined capacity of 6,992 MW.

Four of them - Thai Binh 2, Quang Trach 1, Van Phong 1 and Vung Ang 2 - have completed capital arrangements and are under construction. For Long Phu 1, negotiations are ongoing for continuation with the EPC contractor. The An Khanh-Bac Giang and Na Duong 2 plants plan to tap domestic capital sources.

Prior to the latest proposal, the ministry had already suggested a cut of 14,120 MW of thermal power from the PDP VIII.

As a solution, it proposed that thermal power plants would also use biomass and ammonia as fuel after 20 years of operations, with the initial ratio of 20%. The ratio would increase to 100% gradually, aiming at zero coal-fired power plants by 2050.

Besides, gas-fired power plants would also use hydrogen as a fuel, starting with 20% of the total, after 2030, eventually going on to 100%. The target is that a majority of gas-fired power plants will run with hydrogen in 2050, the ministry said.

It added that by 2050, total demand of hydrogen and ammonia to replace gas and coal respectively would reach 40 million tons. Of this, 33 million tons of green hydrogen would be produced from solar and wind power.

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