Vietnam plans bright future for solar energy

Despite boasting great potential for solar power development, Vietnam has just made little use of it due to a lack of a detailed roadmap and incentive policies.


Big initial investment hinders solar power development in Vietnam.

A recent seminar on the issue, held by Vietnam Green Generation Network, Live & Learn Environmental Education, and the Rosa Luxemburg Institute Vietnam, concluded that the country urgently needed to address the issue.

Future energy sources

The development of renewable energy, including solar energy, is an indispensable trend if the country is to meet rising energy demands as a result of socioeconomic growth and the population boom.

Prof. Dang Dinh Thong, from Hanoi University of Technology's Institute of Engineering Physics, said there had been a global trend to diversify energy sources.

“Solar energy is environmentally friendly, almost entirely carbon dioxide gas emission-free, easy to install and can operate everywhere,” Thong shared.

By early 2011, global solar power output reached 40,000 MW. Of that figure, 16,600 MW were installed in 2010 with Germany contributing half the total.

The world’s solar power generation capacity in 2010 represented half of Vietnam’s annual power demand, he noted.

Over the past five years, solar power capacity has increased by 50% per annum thanks to research development efforts, industry support and Feed-In Tariff (FIT) prices for renewable energy.

According to Thong, in Vietnam, solar energy potential can be spread across the country, areas ranging from the central city of Danang, southwards boasting the potential to produce 140-175kcal per square centimetre per year.

Do Duc Tuong, head of DEVI-Renewable Energies, a renewable energy development institute, said Germany was leading the world in solar cell installation technology. The country was the first to issue a Renewable Energy Act or EEG that has fostered renewable energy industry development.

Germany’s solar energy capacity increased from 1,800 MW in 2008 to 3,800 MW in 2009 and 7,400 MW in 2010.

The country has issued new price lists for solar power and renewable energy in general, which will become effective from January 2012 with prices decreasing by 9% per year.

Big initial investment

Thong shared that in Western countries, a solar energy system costs from USD8,000-USD10,000 per kilowatt-peak (kWp) with a solar cell module costing between USD4,000 and USD5,000 per kWp. The initial investment is rather high compared to other energy sources such as coal, oil and gas, and hydropower, which hinders solar energy development in Vietnam.

Tuong explained that Germany can develop solar power very quickly as it has a clear development roadmap. The German Government also offers incentives to foster the domestic installation of solar power with long-term support.

“They encourage people to develop renewable energy, including solar power, and to connect it to the national power grid. If households consume less than the power capacity they connected to the national grid, the government will pay them at higher rate than the national average power price. Otherwise, if they use more than what they produce, they will be charged at a government-supported rate,” Tuong clarified.

Vietnam’s total solar power capacity to date is estimated at from 1.6-1.8 megawatt peak (MWp). Of the figure, between 25% and 30% is installed at households, 35% developed by the telecommunications industry and 35% by the waterway traffic industry.

Separate solar cell systems are installed at households in mountainous and remote areas.

Systems that combine solar cells with diesel-fuelled power generation sources, or with hydropower sources, or with wind energy sources or with battery sources are installed in some villages and communes with funding from the Vietnamese Government or international donors. The telecommunication industry also develops some hybrid solar panels.

Vietnam has installed a grid-connected solar panel system at the Ministry of Industry and Trade’s office.

A hybrid solar panel system was installed in the central province of Gia Lai with German funding, with another developed in Cu Lao Cham in the central province of Quang Nam funded by Sweden, Thong added.