Vietnam in contention to be top wind power market

Where does Vietnam stand today on the regional offshore wind (OSW) map, and what competitive advantages could position the country as a leading market in the years ahead?

Alessandro Antonioli

Vietnam continues to stand out as one of the most promising long-term OSW markets in Asia-Pacific. The country combines strong natural resources, growing power demand, and significant industrial potential, which together could position it as a leading market in the coming decades.

Vietnam benefits from excellent OSW conditions, including strong and stable wind speeds, a long coastline, and relatively shallow waters suitable for large-scale fixed-bottom projects, which are more cost-efficient than floating solutions.

Another strength is robust domestic demand. Vietnam’s economy is growing rapidly, driving the need for reliable, affordable, and sustainable electricity. At the same time, global manufacturing supply chains are increasingly shifting to Vietnam, with many international companies seeking access to green energy to meet their decarbonisation commitments.

Importantly, Vietnam also has an experienced offshore industrial base, which is often underestimated. Companies such as PTSC have developed strong capabilities through decades of offshore oil and gas activity. This gives Vietnam a clear advantage over markets that must build offshore expertise from scratch.

Investors have become far more selective in recent years. What differentiates countries that successfully attract long-term investment from those that struggle to move projects from ambition to execution?

The key differentiator today is not ambition, but implementation certainty. Investors remain willing to commit significant capital, but they are increasingly focused on markets that offer regulatory clarity, bankable commercial structures, and predictable execution pathways.

OSW projects require large capital investments and long development timelines. Investors therefore look beyond resource potential to the overall investment framework. This includes transparent permitting processes, clear allocation mechanisms, realistic timelines, and grid readiness.

Markets that have progressed successfully are those where governments acted decisively and established coordinated, long-term frameworks. Taiwan is a strong example in Asia-Pacific, having enabled gigawatts of OSW development while simultaneously building domestic industrial capability.

Vietnam continues to have strong fundamentals and interest. However, delays in policy implementation and uncertainty around key commercial frameworks have affected confidence. The encouraging point is that these challenges are still solvable.

The bankability of the power purchase agreement (PPA) remains a key consideration for international investors. What are the main challenges in the current framework, and what improvements would help enhance bankability and draw in long-term foreign investment?

The PPA is probably one of the most critical elements for attracting financing into OSW and large-scale renewable energy projects.

They require very substantial capital investment and are typically financed through long-term non-recourse finance structures. This means financing institutions evaluate the project primarily based on the strength and predictability of its contractual framework, particularly the PPA.

The current PPA framework in Vietnam still lacks several fundamental elements required by international lenders and export credit agencies. These are not unique requirements created by investors, but rather internationally recognised financing principles used globally across infrastructure markets.

One important issue relates to risk allocation. International financing frameworks generally seek to allocate risk to the party best able to manage that risk.

For example, if there is offtake risk or curtailment risk, there needs to be clarity regarding who bears responsibility and how compensation mechanisms are structured.

Currently, there are several areas where the framework remains unclear, including volume guarantees, curtailment risk, termination compensation mechanisms, force majeure provisions and other technical and commercial risk allocation principles. These are essential considerations for lenders because they directly impact financing certainty over the lifetime of the project.

Looking ahead to the next decade, do you see Vietnam primarily as a future OSW market, or does it have the potential to become a regional manufacturing and supply-chain hub for the industry?

I believe Vietnam has the potential to become both a major OSW market and a regional supply chain and manufacturing hub.

The country already possesses several important ingredients required to support this transition. Vietnam has an established offshore engineering workforce, competitive fabrication capabilities, strategic port infrastructure and growing industrial capacity. Vietnamese companies are already participating in regional OSW projects.

This is important because OSW development goes beyond electricity generation. It creates long-term opportunities across industries, including manufacturing, ports, steel, logistics, marine services, and workforce development.

However, supply chain investment depends on long-term market visibility. Developers and manufacturers will only commit capital when they see a stable and sustained project pipeline.

This makes policy visibility critical. Vietnam will need a clear OSW roadmap, transparent timelines, bankable commercial frameworks, and coordinated infrastructure planning. Grid expansion and port development will also be essential.