With more than 3.000 MW of wind power put into operation in 2021, Vietnam is considered a bright spot in the region and the world.
A wind power plant in Ninh Thuan province
Heavy losses
When looking back at the wind power industry in Vietnam in 2021, Mr. Bui Van Thinh, Chairman of the Wind and Solar Power Association of Binh Thuan province, and General Director of Thuan Binh Wind Power Joint Stock Company, said that wind power Vietnam also could not avoid heavy losses when 1/3 of the number was lost project cannot reach the finish line with a total capacity of 2.000 MW, equivalent to capital invest Over 3 billion USD, we don't know where to go, what price to sell, or how to repay the debt.
In current reality, after 2 months from the end of the power purchase policy according to Decision 39/2021/QD-TTg on November 1, 11, the extension of the Fixed Price Mechanism (FIT) for wind power has been talked about a lot, but no plan has been officially finalized, making investors just wait.
Sharing about the current status of investment in wind power recently, Mr. Thinh also said that Vietnam is a bright spot in the region and the world in wind power development, with nearly 4.000 MW put into operation. During the development of the wind power project, the newest and most advanced technologies and the world's leading experts have gathered here, despite 2021 being the peak period of the epidemic, causing countless difficulties. for wind power construction.
However, due to having to race against the deadline to enjoy FIT prices, certain consequences have occurred. “Accidents in transportation, installation and even operation, while rare, have happened more frequently. Land disputes, inflated compensation prices, and even clashes leading to bloodshed have taken place in some projects. This is not commensurate with the clean, environmentally friendly power source that is being encouraged for investment," Mr. Thinh said.
Sadly, after the project finished, it had to face power generation cuts due to the epidemic economy slow development, not due to line overload. “With more than 20.000 MW of renewable energy, if we cut the average by 10%, each year we lose more than 10.000 billion VND. This is a very significant number, considering that renewable energy investors cannot make a profit," Mr. Thinh commented.
Missing the chance to win big also leads to investors of some projects not reaching their destination in time to sue turbine suppliers to reduce losses.
"Investors need to be calm and should not rush into lawsuit battles with turbine suppliers (OEMs) because it is difficult to win," Mr. Nguyen Tien Phong (Pacific Group Joint Stock Company) shared. on an energy forum.
According to this analysis, from around April 4 to April 2020, there was a rush to buy equipment. At that time, except for a few who had negotiated contracts early, the majority of investors ran backwards and searched for OEMs to find turbine suppliers. “Not everyone has the time and mentality to negotiate and carefully read the entire contract with appendices of up to several hundred pages with many strict regulations. Also because of the rush into wind power to reach the finish line at the same time, it is very common for investors to only have 4-2021 days to read and sign contracts with the expectation of reaching the FIT price. Even if this investor hesitates, another investor wants to take his place, ready to sign an equipment supply contract without negotiation," Mr. Phong shared and commented that with that approach, many owners Investing in Vietnam has no chance of winning.
“There are investors who think that they have put so much effort and money into the project. According to the business philosophy of sharing, when they cannot reach the finish line in time, the OEMs will share and reduce prices to support. However, they must understand that the mindset of sellers is different. If sales and profits are not achieved, the leadership may lose their jobs, so it is unlikely that OEMs from rich countries will help. project", Mr. Phong commented.
Long-term opportunity
Sharing the difficult reality of wind power investors who cannot reach the finish line before November 11, experts also said that, according to the draft mechanism for direct negotiation of electricity selling prices for wind and electricity projects, Sun is being built by the Ministry of Industry and Trade, the internal rate of return (IRR) is given at 2021%. During the current difficult and epidemic times, this ratio is considered still attractive compared to the tourism, hotel, aviation industries...
Therefore, now is the time for Vietnamese investors to sit down and discuss and cooperate with OEMs to find common ground, instead of confrontation. OEMs should also, for the sake of their reputation, reduce expected profits and share with investors to overcome this difficult time, because looking to the future, the wind power market in particular and Vietnamese renewable energy The South in general is still long and has many opportunities for development.
Optimistic about the future, Mr. Bui Van Thinh said that the biggest encouragement for renewable energy is that the 26th Conference of Parties to the United Nations Framework Convention on Climate Change (COP26) committed to Strong commitment to Net Zero (zero carbon dioxide emissions) by 2050, including Vietnam. However, it must be seen that this goal is extremely difficult and expensive and requires a clear roadmap right now.
One of the solutions contributing to the implementation of the Net Zero commitment is the development of offshore wind power.
The Draft Power Plan VIII has increased the scale of offshore wind power, from 2.000 MW to 5.000 MW by 2030 and can further increase thanks to COP26 commitments.
In fact, there is also a race to register for offshore wind power with a total capacity of up to 129.0000 MW, promising that the market will be very exciting.
However, Mr. Thinh also mentioned the story of the price of buying renewable energy and the price of selling electricity of Vietnam Electricity Group (EVN) which still have many shortcomings, not following the market mechanism. This makes the more renewable energy purchased, the more EVN loses, the more it affects the construction and upgrading of the power grid to release capacity for renewable energy.
“There is still no way out of the inadequacies in electricity prices, and there are scenes of people crying and people cutting off, with all sorts of reasons. Really, it cannot be called healthy," Mr. Thinh said.
According to Investment newspaper