Support for scaling up wind power

Project description

Title: Up-scaling of wind power in Viet Nam
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ) under the German Climate Technology Initiative (DKTI)
Country: Socialist Republic of Viet Nam
Lead executing agency: Ministry of Industry and Trade (MoIT)
Overall term: 2014 to 2018

Monitoring operation of a wind farm in Viet Nam. © GIZ

Context

Viet Nam is one of the fastest growing economies in Asia. This rapid growth is accompanied by the need to develop new sources of energy. In line with its current Power Development Plan for the electricity sector, Viet Nam aims to triple its installed power generation capacity over the next fifteen years. In addition to adding new thermal power stations, the Government of Viet Nam is also planning to scale up grid-connected wind energy. It aims to increase installed capacity from the present level of 159 megawatts (MW) to 800 MW by 2020 and to 6,000 MW by 2030. This is designed to diversify the national power supply and to make it sustainable as part of country’s Green Growth Strategy.

Viet Nam is considered to have the best wind resources in South-East Asia. In order to harness this potential, the country introduced feed-in tariffs back in 2011 and the government now intends to revise these tariffs to make them market oriented. Scaling up wind energy also calls for a favourable investment environment. This requires project developers, investors, financiers, policy-makers and public authorities to be familiar with the specific technical, commercial and socio-economic aspects of wind power. However, these scaling-up objectives cannot be achieved in the present situation, as neither institutions nor investors are in a position to stimulate the wind energy market nor to plan and implement wind energy projects in an economically viable manner.

In addition, Viet Nam faces serious risks due to climate change. As an alternative to the use of CO2-intensive coal and gas, utilising wind energy for electricity generation reduces greenhouse gas emissions and contributes to mitigating climate change.

Objective

Conditions are improved for public and private institutions, project developers and investors to plan and operate wind energy projects.

Viet Nam. Constructing a wind turbine. © GIZ

Approach

The project focuses on three areas of activity to promote the scaling up of wind energy:

  1. Improving planning capacity and the legal and regulatory environment for utilising wind energy
    The project makes use of studies and data collection to advise, in particular, national policy-makers on topics such as feed-in tariffs and wind measurements. This information aids policy-makers in improving the conditions for developing the wind energy sector.
  2. Increasing the sector-specific and methodological expertise of public and private stakeholders
    One of the project’s aims is to establish this specific knowledge in Viet Nam in the long term. Its activities include training Vietnamese project developers and consulting firms in the technical and methodological aspects of wind park construction. In addition, local banks receive training in financing wind energy projects.
  3. Fostering technology and research cooperation
    The project promotes knowledge building through technology and research cooperation initiatives in the private sector and among education and research institutions in Viet Nam and Germany. For instance, it organises events for promoting exchange between Vietnamese and German research institutions and provides support for cooperative research activities.

The consulting firm Lahmeyer International is supporting implementation of this project.

Results

On the basis of studies about the cost of wind energy production in Viet Nam, the project advised the Vietnamese Ministry of Industry and Trade on raising feed-in tariffs for wind energy to improve the conditions for investment in this area.

Wind measurement data were collected and published in the World Bank Open Data Platform to facilitate planning processes for scaling up wind energy. In addition, the project has drawn up and published a set of guidelines for developing and financing wind energy projects in Viet Nam.

It has enhanced expert knowledge about wind energy among project developers and banks through targeted training courses that were organised after conducting a needs analysis. Moreover, the project has assisted Vietnamese grid operators in integrating renewable energies into their grid infrastructure.

The project is providing support for three joint research projects by Vietnamese and German research institutes that were initiated as a result of a specialist event organised by the project on the topic of wind energy.

Viet Nam. Wind farm in Can Tho Province. © GIZ