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|By Dang Hong Hanh - Co-founder and managing director Energy and Environment Consultancy JSC|
Vietnam’s CO2 emissions rose to 282 million tonnes in 2019, second only to Indonesia in Southeast Asia. Its total annual greenhouse gas (GHG) emissions are projected to increase by 7 per cent this decade under the business-as-usual scenario. Per-capita CO2 emissions rose to 2.9 tonnes in 2019 but remained lower than in Thailand and Malaysia.
The Nationally Determined Contribution report 2020 estimated that among the list of industrial sectors such as energy, agriculture, and forestry, energy is the factor causing the largest CO2 emissions, equalling 65.8 per cent of GHG emissions in 2020, with the figure forecast to soar to 73.1 per cent by 2030.
Thus, power production plays a crucial role in helping Vietnam to realise the commitment in the report and its net zero target – and developing power from renewable energy is considered one of the top priorities.
Fossil fuels are estimated to constitute about half of Vietnam’s electricity mix by 2030. Meanwhile, according to our script to realise the net-zero target, it is necessary to decrease the contribution of fossil fuels to 10 per cent. The remaining 90 per cent of the power supply will have to come from renewable energy, especially solar and wind, as the potential for hydropower plants is exhausted.
Increasing the targets for solar and wind energy in the coming Power Development Plan VIII (PDP8) would boost their uptake. Vietnam has the potential to achieve over 90 per cent of domestic solar and wind power, in addition to hydroenergy, at a competitive cost. The impetus for ramping up renewable energies could be built on the country’s early success in solar and onshore wind power development that made it a leader in Southeast Asia.
Developing offshore wind farms can contribute to GHG emission reduction. According to the PDP8, by 2030, Vietnam will generate 17GW from onshore wind farms and 4GW from offshore wind.
By 2045, the target for both onshore and offshore power capacity is 38GW. The World Bank estimates that by replacing coal power with 25GW of offshore wind power by 2035, Vietnam could avoid over 200 million tonnes of CO2 emissions – nearly one-third of the country’s energy sector emissions under the business-as-usual scenario.
While Vietnam studies breakthrough net-zero technology to serve power production, the country needs to build a concrete and actionable plan to pursue the net-zero target with domestic resources and international support because it takes a huge cost to realise the target.
According to the estimation of the Energy Transitions Commission – which is a global coalition of leaders from across the energy landscape aimed at accelerating the transition to a zero-emissions future, it takes between 1 and 1.5 per cent of global GDP per year to achieve the net-zero target by 2050. Vietnam would need $147-221 billion for this plan.
International support is crucial for Vietnam and other developing countries to unlock opportunities to pursue the net-zero emissions targets. Greater technology transfer and financial assistance from developed to developing countries, including Vietnam, would speed up efforts to address climate change.
Besides this, it needs private investment to promote the domestic carbon credit market. Developing a carbon credit market will contribute to coping with GHG emissions.