GWEC: $6.7 billion investment in wind power in Vietnam is at risk due to COVID-19

GWEC: $6.7 billion investment in wind power in Vietnam is at risk due to COVID-19 - Photo 1.

$6.7 billion investment in wind power in Vietnam is at risk due to COVID-19 – Illustration: TNG

The COVID-19 epidemic in Vietnam has caused a lot of difficulties for the wind power industry such as congestion in the supply chain of wind power equipment, workers unable to move to the project site to work and perform testing work. collecting, restricting movement with foreign experts…

According to the survey results of the Global Wind Energy Council (GWEC), by the end of August 2021, it is estimated that up to 4,000MW of onshore wind power projects in Vietnam are facing serious challenges due to COVID-19. , and therefore risk missing the deadline for the November 2021 FIT price.

Based on international and Vietnamese averages, 4,000MW of wind power in Vietnam is equivalent to $6.7 billion in investment capital. This includes $6.51 billion in fixed asset costs and $151 million in operating costs over the 25-year lifecycle of wind power projects.

If there is no COVID-19 relief measure by extending the application of the FIT pricing mechanism by at least 6 months, these projects will suffer unexpected losses caused by the pandemic.

Local governments will lose important investments and revenues, hinder progress towards achieving the renewable energy targets set out in resolution 55/NQ-TW, and a cycle “bankruptcy” caused the wind power market in Vietnam to take many years to recover.

Therefore, GWEC calls on the Government of Vietnam to extend the time limit for applying the FIT pricing mechanism by at least 6 months, until the end of April 2022 to support the wind power industry.

GWEC advocates the application of clear criteria for the selection of projects eligible for deferrals. This measure is in line with international practice for pandemic relief.

In May 2020, the US granted a one-year grace period for wind power projects to complete and enjoy tax credit incentives. In June 2020, India extended the deadline for commercial operation by 2.5 months for renewable energy projects to mitigate the impact of lockdown measures due to COVID-19.

Mr. Mark Hutchinson, Chairman of GWEC’s Southeast Asia Working Group, shared: “Vietnam is one of the wind power markets with the largest potential in Southeast Asia. However, this is also an extremely difficult period. important for the onshore wind industry”.

“The government needs to delay the application of the FIT pricing mechanism to create conditions for 4,000MW of wind power projects with economic efficiency and the ability to realize completion within a reasonable time. If the project volume is lost, With this wind power, the investment environment for renewable energy will be dealt a big blow, and Vietnam’s wind power market may take many years to recover,” warned Mr. Hutchinson.

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