Energy dilemma weighs on Vietnam

Energy dilemma weighs on Vietnam

With an expected boost from regional suppliers of coal and equipment,
Vietnam plans to rely more heavily on coal-fired power plants by 2030.
Unless it can be mitigated, this is not only bad news for a Southeast Asian
nation already suffering from severe air pollution but also for
international efforts to battle climate change.

Vietnam's current energy plan calls for more than 50% of its electricity
production to come from coal by 2030, as compared with roughly a third in
2015. But Vietnam has likewise pledged to reduce greenhouse emissions by 25%
over the same period, a pledge that some experts say will be difficult to
achieve.

As a rapidly industrializing nation, Vietnam needs more electricity for both
industries and homes.In order to reach its goal for 2030, Vietnam will not
only build more coal-fired power plants but also is likely to import more of
the fuel. Chinese companies appear ready to supply Vietnam with both coal
and equipment, even as China closes some of its own coal-fired plants at
home.

Australia and Indonesia can also supply more coal. And while coal is
abundant in Vietnam, imported coal is now cheaper than what's available on
the domestic Vietnamese market.

At the same time, for those concerned about air pollution, Vietnam has made
initial moves at a high level to encourage the use of solar power. The costs
for both solar and wind power have dropped, and Western nations are prepared
to provide aid and technical support for the necessary installation.

If Vietnam follows up with a detailed policy on solar and wind power, it
might then be able to trim back its plans to sharply increase its use of
coal.

Only a few years ago, Vietnamese officials held out great hope for nuclear
power plants which were to be built by the Russian state company Rosatom.
But Hanoi apparently decided that the costs were too high.

According to VnExpress, an online newspaper run by FTP Corp, "the renewable
energy sector remains immature and nuclear power seems out of reach."

Vietnam's hydropower has now reached its maximum capacity with no room for
growth, the Vietnamese online newspaper reported. This has led Vietnam to
rely on coal-fired power as the "mainstay" to keep up with growing demand,
it said.

Vietnam's Deputy Prime Minister Trinh Dinh Dung was quoted saying that
"thermal energy, especially coal-fired and gas-fired power will remain our
main source of electricity until 2030 and possibly even longer."

Nguyen Tai Anh, the deputy director of Electricity of Vietnam (EVN), the
state power company, said in the same report that coal-fired plants'
emissions will be "minimized by the application of modern technology."

EVN, however, could be part of the problem.

David Brown, a former US diplomat and Vietnam expert who has written
extensively for the environmental website Mongabay, says that EVN has been
at least until recently "bloated and inefficient, wedded to old methods, and
overly fond of yesterday's technology."

Long after Vietnam introduced economic reforms in other sectors years ago,
Brown says, Soviet-style planning survived at EVN and to a considerable
extent also at the coal and minerals monopoly Vinacomin and the oil and gas
monopoly PetroVietnam.

These powerful state energy companies, Brown notes, have alliances and close
relations with leading Communist Party officials. With many details of
Vietnam's energy policy yet to be settled, some aspects of the policy's
implementation might be subject to their influence, especially if they feel
that their interests are threatened

This raises questions about how the notoriously inefficient EVN would handle
an expansion of Vietnam's electricity grid and transmission lines as it
moves to accommodate increased power demands.

On the positive side, Duong Quang Thanh, the new chairman of EVN, at least
recognizes past problems and new challenges facing the energy group and is
speaking out about them publicly.

According to the website DealStreetAsia, the group's failings have included
unprofessional customer service, a failure to balance its books despite huge
government financial support, and making up for losses by increasing
electricity rates instead of improving efficiency.

EVN itself has reported that its productivity was only a tenth of
Singapore's electricity industry, three quarters of Malaysia's, and less
than 50% of Thailand's.

DealStreetAsia said that Duong Quang Thanh is predicting that he can boost
Vietnam's productivity to the point where it will reach Malaysia's level by
2020.

But three Vietnamese experts noted in a scientific journal earlier this year
that until now Vietnam has failed on a wide scale to enforce environmental
protection laws.

A Harvard University and Greenpeace study concluded that pollution from coal
had led to some 4,300 premature deaths in Vietnam in 2011.

In April 2015, pollution from the Vinh Tan-2 power station located on the
south-central coast of Vietnam caused thousands of protesting local
residents to block a national highway. The police cracked down and sent
seven of the protesters to prison.

Despite government directives to EVN to curb the pollution from coal dust
afflicting villagers living near the power plant, the problem has persisted.

In the latest development, Radio Free Asia reported on August 9 that Vietnam
had cancelled a controversial plan to dump some one million cubic meters of
a mix of sediment, silt, and sand from the power plant into the sea.

The plan had met with strong opposition from local residents, fishermen, and
aquaculture farmers, who argued that the waste would destroy coral reefs and
fishery grounds.

The troubled US$1.5 billion Vinh Tan-2 plant was built under a contract with
the Shanghai Electric Group as part of a complex made up of four separate
plants.

On a seemingly positive note, the capital city of Hanoi has produced a plan
to curb another source of air pollution-an estimated five million motorbikes
spewing so much gas into the air that breathing can often be difficult.

According to the Vietnamese nongovernmental organization GreenID, which
promotes the development of renewable energy, Hanoi suffers for much of the
year from excessive levels of PM2.5, fine particles in the air that can
damage the heart and lungs.

Under the new plan, city residents would gradually switch to public
transportation, with a ban on motorbikes going into effect by 2030.

But Hanoi residents interviewed by foreign journalists express doubt that
the city can put into place a public transport system that would allow the
projected switch away from motorbikes.

Some complain that the plan would be unfair to the majority who can't afford
to buy automobiles. Currently, Hanoi has limited bus transportation and no
underground system, while fewer than 10% of residents use buses.

Vietnam certainly has one thing going for it: While the Vietnamese media are
regulated and censored, they sometimes push the envelope. They may fail to
tell the full story, especially when corruption involving officials might be
an issue.

But when environmental issues affecting human lives arise, such as air or
water pollution, they are often the first to point to the trouble spots and
culprits.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Link to Original Article:
http://www.atimes.com/article/energy-dilemma-weighs-vietnam/

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com