Vietnam's energy plan

Vietnam’s PDP8: Energy Plan for the Future

The Vietnamese government has recently announced its ambitious new Power Development Plan, known as PDP8, setting out the country’s electricity roadmap for the period through to 2030, with a vision towards 2050. Pietro Karjalainen, Asian Insiders partner for Vietnam explains the new energy plan and consider opportunities for investors.

Vietnam has enjoyed recent years of considerable growth, pandemic aside, and this has placed strain upon the country’s energy generation and the environment. The current energy mix is dominated by fossil fuels, primarily coal, accounting for over 80% of electricity generation. The key goals for PDP8 are to:

  • Increase the share of renewable energy in the country’s electricity mix to 26% by 2030 and over 60% by 2050.
  • Reduce carbon emissions intensity by 20% by 2030 and 45% by 2050.
  • Ensure ongoing security and reliability of electrical supply.

To achieve these goals, PDP8 calls for a significant investment in renewable energy and energy efficiency while including measures to promote the development of smart grids. Factored into the Power Development Plan is expected population and economic growth, industrial development and environmental concerns and holds the potential to transform Vietnam’s overall energy sector while making the country a leader in renewable energy.

Vietnam’s energy plan assumes that the country will achieve an average GDP growth of around 7% per year from 2021 to 2030, followed by average growth rates of 6.5 to 7.5% in the years up to 2050. That means the country’s electrical generation needs are going to reach 505 billion kWh by 2030 and somewhere north of 1,230 billion kWh by 2050.

Renewable energy accounts for approximately 14% of Vietnam’s current power generation, mainly solar wind and biomass (waste-to-energy). The government is targeting onshore and offshore wind power generation of up to 28,000 Megawatts (MW) by 2030, with further targets of up to 70-91.5MW by 2050. Tropical Vietnam, blessed with near year-round sunshine, anticipates the capacity for solar power generation to reach 4,100 MW by 20130 with elements of land and sea solar farms, as well as promoting rooftop production across the country. The new plan includes adding plants for   biomass and hydro power generation of 2,300 MW and 30 MW by 2030 respectively. While renewable energy is more expensive to generate than fossil fuels, however technological improvement is anticipated to lead to a decline in cost of production in coming years.

Coal power will be phased out with some plants converted and older plants decommissioned by 2050. Gas is planned to become Vietnam’s primary power source by 2030, providing significant environment advantage over coal. Vietnam has various gas projects in development providing a total capacity of gas production of 37,600 MW by 2030, however by 2050, the majority of these plants will transition to hydrogen and a decreased reliance on traditional gas sources.

By 2050, Vietnam’s energy plan allows for 34% solar, 30% wind with contributions from biomass, hydro, hydrogen and stored power. Imported power is projected at 1-2% only, making Vietnam largely self-sufficient. The energy plan allows also for changing technologies in electricity generation, transmission and storage capacity as well as in grid infrastructure.

In addition to renewable energy and grid expansion, PDP8 promotes energy conservation, with initiatives to promote energy saving practices in industrial, commercial and residential buildings. The plan includes the adoption of energy-efficient technologies, implementation of energy management systems and the dissemination of energy-saving awareness campaigns. This will limit growth in energy consumption, lower carbon emissions and assist in meeting Vietnam’s international emissions targets.

Large scale development requires large scale investment with approximately USD 135b required by 2030, including around USD 15b required to upgrade grid infrastructure. From 2031 to 2050, it is estimated that Vietnam’s energy sector will require a further investment of USD 400 – 523 billion. These figures provide significant opportunities for international energy companies.

To discuss investment and partnership opportunities in Vietnam’s electricity and energy sector, please contact Jari Hietala, Managing Partner: jari.hietala(at) or Pietro Karjalainen, Vietnam Partner: Pietro.karjalainen(at)

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