According to the World Bank's Proposal Report, the World Bank has proposed 20 actions to address three priority themes to help develop Vietnam's offshore wind power into an industry.

Defining Vietnam's wind power development vision

Report on Offshore wind power industry development roadmap made by WB from February to October 2020 at the request of the Government of Vietnam.

According to the assessment of the WB, by 2035 Vietnam will have about 450 large-sized offshore wind turbines in operation, installed in about 10 fixed foundation offshore wind farms and one or two floating foundation wind farms.

Besides, based on current plans, there will be about 30 small nearshore wind farms using smaller turbines. However, some of these nearshore projects may not proceed due to the risk of adverse environmental and social impacts in the nearshore area.

Wind power near shore and adverse impacts on the environment

According to the Report, nearshore wind power projects are those where the wind farm is 3 nautical miles from the shore, or 5.5 km, and can be directly accessed from the mainland. The foundation of the wind turbine in these projects is usually a pile with a concrete cap, the turbine used is the wind turbine that was originally used onshore but with some minor modifications. Turbine installations often use simple barges and are carried out in shallow, calm waters.

The nearshore wind power project is seen as a stepping stone to the onshore and offshore wind power that Vietnam has soon established, especially in the Mekong Delta region.

In the Report it is written: “The development of wind power in this near-shore area has a high risk of causing adverse environmental and social impacts for a number of reasons: the presence of animal species located in the coastal areas. Red Book in coastal areas; the proximity of these areas to protected or sensitive habitats; potential impact on coastal sediment dynamics; potential impact on coastal communities, particularly on the livelihoods of collectors.”

According to the same assessment, nearshore wind power projects located near key biodiversity areas, important habitat areas or sensitive wildlife will find it difficult to meet the standards of the funds. international standards, often following the World Bank's environmental and social standards.

To avoid or manage these impacts, effective marine spatial planning needs to be completed from the outset. Project-specific environmental and social impact assessments (ESIA) will be required to collect baseline data and identify appropriate measures to avoid, minimize and compensate for impacts. related to the project.

Scaling - Optimizing costs

In the World Bank Report, it is also estimated that the energy costs of the first offshore wind power projects will be high due to risks associated with new markets and the lack of local supply chain capacity, which is expected to be in the range of 150-200 USD/MWh.

Experience from wind markets around the world shows that energy costs will fall rapidly as more projects are built, risks are reduced and local capacity increases. This cost could be reduced to 80 to 90 USD/MWh in 2039 and 60 to 70 USD/MWh in 2035.

The above cost reduction is due to the use of large offshore turbines with rotors designed for lower wind speeds, reducing capital costs by reducing risk and having large financial availability. and growth in domestic and regional supply, capacity building and competition driven by market size and reliability.

From the analysis of strengths, weaknesses, opportunities and threats (SWOT) for Vietnam when applying the low scenario, it also shows that the market size will not attract much attention of developers. as well as will not be able to maintain domestic competition enough to be able to compete in terms of supply as well as nail production.

Besides, energy costs are 23% higher than the high growth scenario and the cumulative net cost is 2.5 times higher for 47% of electricity by 2035. In particular, the Government must do the same. amount of work to generate 27% of employment volume and total value added (GVA) compared with the high growth scenario in 2035. At the same time, this will also rely too heavily on nearby wind power projects. The shoreline has a high environmental and social impact.

In the low growth scenario, the challenge for Vietnam is that the supply chain in the region is definitely more established than in other East Asian and Southeast Asian markets, leading to more imports, more suppliers. The global wind turbine supplier will be less likely to develop low-speed wind turbines suitable for the Vietnamese market, which is a key factor in reducing energy costs.

In the absence of clear Government guidelines and standards for environmental and social impact assessment, site selection and development of initial projects are not good, including wind power projects. close to shore, which can lead to adverse environmental and social impacts, damage the reputation of the industry, and slow foreign investment opportunities and future growth prospects.

The study also shows that, compared with the low growth scenario, the high growth scenario will lead to a faster cost reduction, up to 20% of the cost of energy equivalent (LCOE) by 2035; nearly quadrupling the number of local jobs and value added to the economy by more than halving the net cost to consumers.

Experience from previous offshore wind markets shows that ambitious, long-term goals can be the foundation for industry growth.

The results of this roadmap show that the target of 10GW in 2030 and 25GW in 2035 can be completed. At the same time, the consequence of higher growth is a higher risk of adverse environmental and social impacts.

This places even greater importance on the need to develop a marine spatial plan and an environmental regulatory framework prior to the issuance of a marine lease.

According to Investment Newspaper