The government of Vietnam has unveiled details of its Renewable Energy Development Strategy (REDS) to 2030, aiming at reducing the country's dependence on fossil fuels by promoting renewable energy sources and energy efficiency.
Vietnam targets a strong reduction in coal and oil imports to cut greenhouse gas emissions by 5% by 2020, 25% by 2030 and 45% by 2050.
Renewable power generation should cover 7% of total generation in 2020 and 10% in 2030 (from less than 1%, excluding hydro, in 2014). Biogas consumption should increase from 4 mcm in 2015 to 8 mcm in 2020, 60 mcm in 2030 and 100 mcm in 2050 and biofuels should cover 5% of vehicle consumption by 2020 (13% in 2030 and 25% in 2050). The rate of households using solar heat equipment should rise from 4.5% in 2015 to 12% in 2020, 26% in 2030 and 50% in 2050, while that of households using high efficiency stoves should reach 30% in 2020, 60% in 2025 and 100% in 2030.
To reach these targets, Vietnam will create a Sustainable Renewable Energy Fund, financed by the state budget and environmental fees for fossil fuels. Renewable energy projects connected to the national grid will benefit from investment guarantees and isolated power renewable energy projects will benefit from subsidies from this Sustainable Renewable Energy Fund.
A Renewable Portfolio Standard (RPS) mechanism will be introduced for large power generation companies (capacity over 1000 MW, excluding BOT projects); these companies will have to reach 3% of renewable power capacity by 2020, 10% by 2030 and 20% by 2050 (same rates for power sold by distribution companies). Customers purchasing electricity from the National Power System to develop power RE projects will benefit from a compensate payment mechanism (net metering system) while renewable projects will benefit from preferential policies on taxes, land and environment.
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