Vietnam Struggles with LNG Power Development Amid Rising Electricity Demand
The Vietnamese government is facing significant challenges in implementing its plan to develop 22,524MW of liquefied natural gas (LNG) power capacity by 2030. According to Associate Professor Trần Đình Thiên, LNG has emerged as an optimal solution to rapidly growing electricity demand while restructuring the energy mix towards cleaner sources.
The country's eighth power development plan aims to have 22 LNG-fired power projects built and put into operation between 2025 and 2035. However, industry officials and experts say that moving projects from planning to financial close and construction is the biggest challenge.
Bùi Quốc Hùng, deputy director of the Electricity Authority of Vietnam, identified key issues in developing LNG power, including creating stable power purchase and dispatch mechanisms, developing synchronised LNG infrastructure, coordinating power plants with grid development, strengthening investor accountability, and ensuring LNG development does not delay the broader energy transition.
Ngô Trí Long of the Việt Nam Financial Consultants Association said that financing and market design are the two most important factors for LNG power projects to raise capital and operate efficiently. He emphasized the need for predictable cash flows and bankable contracts, as well as transparent price signals and a competitive, efficient market.