IFC, Singapore PE firm may invest in Vietnamese renewable energy firm GEC

International Finance Corporation, the private lending arm of the World Bank, is partnering a Singapore-based private equity firm to invest in Gia Lai Electricity JSC (GEC), one of Vietnam’s largest private-sector independent small hydroelectric power producers.

IFC together with a private equity fund based in Singapore proposes to invest up to 36% equity stake in GEC, according to its investment disclosure. The investment is meant to support GEC’s renewableenergy development plans in Vietnam.

The quantum of investment as also the name of the PE investor were undisclosed. 

GEC is 87% controlled by Thanh Thanh Cong Group (TTC), a Vietnamese conglomerate founded by Mr Dang Van Thanh in 1979. TTC is Vietnam’s largest private sugar manufacturer. It also has 79 MW biomass power plant portfolio owned by its various sugar business units. 

Mr. Thanh was also the founder and chairman for 20 years of Sacombank, one of the largest commercial banks in Vietnam.

TTC has identified its next growth opportunity in renewable energy, and set a medium-term strategy to grow GEC into a leading renewable energy business in Vietnam. GEC is thus also considering wind and solar projects in addition to hydel power plants, the filing said. 

Founded in 1989, GEC  owns and operates 15 existing hydro power projects totaling 84 MW in installed capacity. Majority of its portfolio comprises small hydro power projects (HPPs), ranging from 0.3MW to 16MW. 

GEC’s business model consists of the development and acquisition of small HPPs, wind and solarprojects. While GEC’s ow

GEC is located in Gia Lai province, in the Central Highlands of Vietnam. Many of GEC’s existing small hydro power projects are located in the same province. GEC also has several projects located in different provinces of Vietnam, mainly in the central area of Vietnam. 

IFC has been quite active in investing, both debt and equity, in Vietnam as also the East Asian region. Some of its recent proposed investments include a $20-million commitment in Canadian Solar for its Vietnam foray and an acquisition financing loan for Golden Towers in the telecom space.

Source: dealstreetasia

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Canada energy firm eyes $150m solar power plant in Vietnam

Canadian company CMX Renewable Energy Inc has sought a license to build a 150-megawatt solar powerplant in the central province of Ninh Thuan at an estimated cost of $150 million, newswire Thanhniennews.com reported.

SolarEnergy Power Future in Vietnam

CMX is the latest foreign investor to have expressed interest in setting up a solar energyproduction unit in Vietnam after the government said that it is drafting policies to encourage private investment in the sector. 

According to one of the plans being considered by the government, state company  Electricity of Vietnam and other electricity distributors will be obliged to buy all the output from solar power plants in 10-20 years, the government’s website reported.

The country’s first solar power plant is expected to start functioning next year. It is a 19.2-megawatt plant being built in the central province of Quang Ngai by Vietnamese investor Thien Tan Group at an estimated VND862 billion ($36.12 million).

 Last year South Korea’s SolarPark Korea sought to build a 300-megawatt plant in another central province, Ha Tinh, at $650 million.

 Another Korean investor, Hanwha, also reportedly plans to invest $200 million in developing a 100-200-megawatt plant in Thua Thien-Hue.

 Source: dealstreetasia

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Foreign firm to produce solar cells in Vietnam

HCMC – JA Solar Hong Kong Investment, a major manufacturer of high-performance solar power products, will develop a solar cell production project worth over US$1 billion in the northern province of Bac Giang.

According to Saigon-Bac Giang Industrial Park Corporation (SBG), the investor of Quang Chau Industrial Park (IP), the Hong Kong firm has inked an in-principal deal with SBG to lease 88 hectares of land at the IP to build a solar cell plant. With the land lease, the Vietnamese firm can earn over VND1 trillion.

JA Solar, which currently has eight production plants worldwide, regards its investment in Vietnam as a breakthrough in the low-cost supply chain and a typical investment in the field of solar cell production, said SBG, a subsidiary of Kinh Bac City Development Holding Corporation.

Nguyen Van Linh, chairman of Bac Giang Province, said at the signing ceremony last week that the province would facilitate JA Solar in terms of legal and customs procedures, human resources and infrastructure so that it could put into operation its project soon.

Once licensed, the project of JA Solar will become the 16th investment at 600-hectare Quang Chau IP. It is also expected to generate jobs for more than 3,000 people.

Source: E.thegioisaigontimes 

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Vietnam's ancient town to light up main attractions with solar power

The $147,000 project uses funding from the German government.

Street lanterns win the hearts of many tourists to Hoi An. Photo by VnExpress/Tran Viet Anh

Hoi An, the much loved ancient town in central Vietnam, has started a new project to use solar power for its major attractions, with funding from the German government.

The $147,000 project will set up solar panels at the one-hectare (2.5-acre) Hoai River Square to provide a 55 kWh source for sound and lighting systems at street arts programs, entertainment centers, street lanterns and the iconic 400-year-old Japanese bridge nearby, officials said.

The German government will cover 90 percent of the cost, while Hoi An and its German twin city Wernigerode will chip in the rest.

Once a popular trade port in the region, Hoi An is now one of the most peaceful, greenest towns in the country, drawing tourists to its picturesque wooden houses, pagodas, street-side eateries and hundreds of tailor shops.

A travel forum run by U.S. magazine USA Today described Hoi An as one of 10 most beautiful places in Southeast Asia, a place where one can find “tranquility and timelessness.”

“Best Day on Earth,” a new book from the UK travel publisher Rough Guides, listed Hoi An’s full-moon festival among the world’s most extraordinary travel experiences for the hundreds of lanterns that glow along alleys and river banks around town.

The solar power project is hoped to help the city develop sustainable tourism that is suitable with its strategy to become an eco-friendly destination.

Source: E.vnexpress

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Vietnam utility cuts power purchases from China

Vietnam Electricity refrained from buying electricity from China last month following a surge in domestic output.

Solar Energy Power Future in Vietnam

Vietnam’s electricity output during the first eight months of this year has increased by 11.2 percent to 117.1 billion kilowatt hours (kWh), including 1.2 billion kWh imported from China, said the country’s utility group EVN said Saturday.

Hydropower plants which in the first eight months of 2016 generated 32.7 percent of Vietnam's electricity, often face shutdowns during the dry season, causing nationwide outages. Meanwhile, coal has taken over hydro power as the leading source of electricity in the country as it has generated 38.03 percent of the total output so so far this year. 

In response to fast growing demand for power, Vietnam is building more coal-fired thermal plants and buying electricity from neighboring China.

However, EVN said last month it stopped buying power from China for the second month in a row.

The state-run group which started buying electricity from Chinese power plants in the border province of Yunnan in 2004, expects it will not have to import more power from the neighboring country in four consecutive months.

EVN plans to import about 950 million kWh from China to meet the domestic power needs in 2016, down 44 percent from 2015.

EVN said Vietnam's power output is expected to reach 183 billion kWh this year.

The average energy consumption in Vietnam grew 13 percent from 2006-2010, and by about 11 percent from 2011-2015, said Le Tuan Phong, deputy head of the General Directorate of Energy, adding that the country is on the path towards powering itself by 2030.

The country’s power production is expected to grow at an annual rate of 14 percent between 2015 and 2030.

Vietnam is also restructuring its power sector by breaking up its retail power monopoly EVN to develop a competitive retail power market by 2030.

And it is aiming to generate enough energy to power almost every home by 2020 and increase residential solar power usage to 50 percent of households nationwide by 2050.

Source: E.vnexpress

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Vietnam: FDI into Solar Energy Increased Sharply

Vietnam is becoming attractive locations for investors producing solar panels from China, Taiwan to expand production in order to meet increasing demands of the world as well as make use of the advantages of tax for exports to the two largest markets which are the US and Europe.

Vina Solar has just signed a contract with GCL-SI – China’s leading solar panels manufacturer and Trina Solar Company to develop the project to produce solar energy panels with capacity of 600 MW and 1 GW at the factories in Vietnam. In particular, GCL-SI Company also announced an investment of 32 million USD together with Solar Vina in Vietnam.

According to President of GCL-SI, this investment is not only brings cost advantages but also help organizing the supply chain of the Company.

Also reported by GCL-SI Company, this is a notable move to strengthen competitiveness as well as to expand opportunities to join the US and EU markets as these two markets are having trade barriers, which are set for solar energy panels manufacturing in China and Taiwan.

Meanwhile, with an investment of 100 million USD, Trian Solar Company has recently completed construction the project producing solar energy panels with capacity of 800 MW/year in Bac Giang – the province with highest solar energy panels production scale in the country, with a total capacity of 5,200 MW/year. Moreover, Bac Giang is forming production and assembly chains of solar energy panels with 8 projects have been licensed, the total registered capital reached 635 million USD.

Under the agreement, Vina Solar will supply and assemble PV modules for Trina Solar. This is the largest project of Trina Solar in Vietnam. The project has a workshop area of 42,000 m2, with 14 modern production lines, the factory produce many kinds of single-crystal and polycrystalline batteries. The products are exported to all continents in the world.

According to the Chairman and CEO of Trina Solar, the factory in Vietnam is a result of global strategy, following the opening of the factories producing solar energy panels in Malaysia and Thailand. This cooperation will bring benefits for both parties, helping to bring solar energy panel production technology to Vietnam and create about 1,000 jobs.

In November 2016, JA Solar Corporation (China) has started construction of the 1 billion USD project to build a factory producing solar energy batteries at Quang Chau Industrial Park (Bac Giang). The project is divided into several stages, with the scale of 88 hectares of land.

According to forecasts, the demand for solar energy panels worldwide will increase after 2016, while the cost of installation and production will continue to decline. According to the report of International Renewable Energy Agency, that trend will contribute to replace fossil energy. This is the reason why many solar panels projects are warming up in Vietnam, after several major projects are bankrupt previously.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

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We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

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New Solar Power Plant Project in Binh Dinh

Solar energy is encouraged to invest by Vietnam Government. Therefore, there were many foreign business delegations come to Vietnam to find out opportunities in this area.

On January 11^th 2017, Chairman of Binh Dinh Province has met and worked with the President of Truong Thanh Investment and Development Co., Ltd (Vietnam) and Truong Thanh’s partners from Japan and Spain to find out opportunities to invest in solar energy plant project in Binh Dinh, Vietnam.

According to representatives of Truong Thanh, in recent time, the Company has made the solar power plant investment project proposal in Cat Hiep commune, Phu Cat district, Binh Dinh province. The project capacity is 95mW, using land area of about 150 hectares.

The expected investment capital for plant construction is 4,000 billion VND. Tuong Thanh Company wants to be supported by leaders in Binh Dinh Province and relevant local Government agencies with the investment procedures.

According to Chairman of Binh Dinh Province, they are always welcome and encourage enterprises to invest in power plant using renewable energy, which is very environmentally friendly.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

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Vietnam, Ireland ink deals to build $2.2 billion wind farms

The farms, one in the central region and the other in the south, will have a combined capacity of 940 MW.

Companies from Vietnam, Ireland and the U.S. on Monday signed cooperation agreements to build two wind farms in Vietnam worth $2.2 billion.

Part of a wind farm in the Tuy Phong District of Binh Thuan Province. Photo courtesy of Nguoi Lao dong news site

The pacts are part of various deals reached by Vietnam and Ireland during the visit to Vietnam by President of Ireland Michael D. Higgins from November 5-14.

Vietnam’s Phu Cuong Corporation will join hands with Ireland’s Mainstream Renewable Power Ltd. and the U.S. giant General Electric to set up an 800-megawatt wind farm in the southern province of Soc Trang. The project will need $2 billion.

In the second project, Vietnam’s Pacific Corporation will cooperate with Mainstream Renewable Power Ltd. to build another 140-MW wind farm in the central province of Binh Thuan, which is worth $200 million for construction.

The same day Vietnam and Ireland also signed other agreements on poverty reduction, education and training, information and communications.

Vietnam has recently revised down the target for electricity generation by coal-fired thermal power plants from 56.4 percent of the total electricity generation to 53.2 percent by 2030.

The country is more focused on renewable energy, particularly solar and wind energy, targeting a renewable energy ratio of 10.7 percent by 2030.

But that will require a lot of investment in the coming years. Wind and solar power capacity is estimated to account for only 0.8 percent and 0.5 percent of total electricity generation respectively by 2020.

With over 3,000 km of coastline and numerous islands, Vietnam has more wind power potential than most of other Southeast Asian nations with a total estimated capacity of 24,000 MW, the Vietnam News Agency has reported.

Source: Bao Vnexpress

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Fast-growing Vietnam to invest $40 billion in electricity projects by 2020

The country is also shifting attention to renewable energy to meet the needs of the economy.

Vietnam may need to invest about VND859 trillion ($38 billion) in electricity generation, transmission and distribution infrastructure between now and 2020 to meet domestic demand, the government said in a new report.

 Fishermen working near the first towers of wind turbines from a Vietnamese wind power plant. Photo by AFP

That is equivalent to 20 percent of the country's gross domestic product last year.

According to the report, about 75 percent of the investment will go to generation and the remaining 25 percent to upgrade, repair and expand the national transmission and distribution system.

The government said a majority of the investment would be funded by loans and the state budget would cover only 0.5 percent.

The average electricity consumption steadily grew at 13 percent between 2000 and 2010, and about 11 percent between 2011 and 2015, said Le Tuan Phong, deputy head of the General Directorate of Energy, under the Ministry of Industry and Trade.

The country’s electricity demand is expected to continue to grow 13 percent annually in the next four years to feed the economy, which has grown above 5 percent a year on average since 1999 and is forecast to reach 6.5-7 percent in the next four years.

It is estimated that Vietnam will need about 47 billion kilowatt-hours by 2030 for the annual economic growth rate of 7 percent.

Vietnam is trying to generate enough energy for growth and for millions of people who still lack access to electricity while gradually shifting towards clean and low-carbon energy, said Tran Dinh Thien, who heads the Vietnam Economic Institute.

The government has recently revised down the target for electricity generation by coal-fired thermal power plants from 56.4 percent of the total electricity generation to 53.2 percent by 2030.

Vietnam is more focused on renewable energy, particularly solar and wind energy, targeting a renewable energy ratio of 10.7 percent by 2030.

But that will require a lot of investment in the coming years. Wind and solar power capacity is estimated to account for only 0.8 percent and 0.5 percent of total electricity generation respectively by 2020.

Source: Bao Vnexpress

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Foreign investors lay eyes on Vietnam’s renewable energy sector

Vietnam has opened up to foreign investors in a bid to meet the rising demand for power.

The World Bank’s International Finance Corporation (IFC) and the Singapore-based renewable energy private equity fund Armstrong S.E. Clean Energy Fund have formed a partnership to invest in Gia Lai Electricity JSC (GEC).

IFC has acquired a 16 percent stake in the Ho ChiMinh City-based power company while Armstrong has taken a 20 percent share.

The move by IFC and Armstrong could spur further foreign interest in the country’s renewable energy sector.

Hydropower is the world’s largest source of renewable energy and accounts for one-fifth of the world’s electricity, according to statistics from IFC.

“As shareholders, IFC and Armstrong will not only support the company in expanding its core business in hydropower, but also help GEC become a leading company in Vietnam’s renewable energy sector,” said chief executive Le An Khang.

“Their investment is a vote of confidence in Vietnam’s hydropower sector potential and should help attract more international investors,” he continued.

Vietnam’s electricity consumption has grown twice as fast as the country’s economic growth rate in recent years. The country’s power output is expected to grow at an annual rate of 14 percent between 2015 and 2030.

Source: Bao Vnexpress

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Vietnam pushes renewable energy with focus on solar power

Vietnam is grappling to generate enough energy to power the economy.

Vietnam’s electricity consumption has grown twice as fast as the country’s economic growth rate.

The average energy consumption inVietnam grew 13 percent from 2006-2010, and by about 11 percent from 2011-2015, said Le Tuan Phong, deputy head of the General Directorate of Energy. The country is on the path towards powering itself by 2030, Phong said.

The country’s power production is expected to grow at an annual rate of 14 percent between 2015 and 2030.

Fossil fuels still dominate Vietnamese energy consumption. According to the World Bank, over 66.2 percent of the country’s energy comes from fossil fuels.

Vietnam’s annual coal output is currently about 40 million tons, official statistics show.

Coal has taken over from hydro power as the leading source of electricity in Vietnam, which has recently become a net coal importer.

In response to fast growing demand for power, Vietnam is building more coal-fired thermal plants and buying electricity from neighboring China as part of measures to avoid outages.

Vietnam, however, is faced with a two-fold energy challenge. The country has to generate enough energy for economic growth and for millions of people who still lack access to energy services, while gradually shifting towards clean, low-carbon energy, said Tran Dinh Thien, head of the Vietnam Economic Institute.

“Vietnam’s economic growth still relies heavily on the exploitation of natural resources and relatively low-tech production. Industries such as cement and steel use a colossal amount of energy,” said Thien, adding that only 2 percent of local businesses are high-tech driven.

The Vietnamese government should change the country's economic structure and prioritize energy-saving industries, Thien suggested.

Half of Vietnamese households use solar energy

Along with the need to decrease the reliance on fossil fuels, the country needs to build an energy sector more focused on renewable energy, particularly solar energy.

To put Vietnam on a path to a clean energy economy, the government plans to cut coal consumption by 30 percent by 2030.

The government has also opened up its renewable energy sector to foreign investors, allowing them to invest in power generation. Official statistics show that in 2013, foreign investments in energy through the Build – Operate – Transfer model accounted for 6 percent of total installed capacity.

The country is also restructuring its power sector by breaking up its retail power monopoly EVN to develop a competitive retail power market by 2030.

Vietnam is aiming to generate enough energy to power almost every home by 2020 and increase residential solarpower usage to 50 percent of households nationwide by 2050.

Source: Bao Vnexpress

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German firm jumps on Vietnam's renewable energy bandwagon

Terra Wood is proposing a $400 mln wind and solar energy project.

German green energy firm Terra Wood has revealed plans to invest $400 million in a wind and solar electricity project in Vietnam, contributing to an active week of renewable energy deals made by foreign investors.

The energy company has submitted an investment plan to build the project in Vietnam’s south central province of Quang Ngai, and on-site inspections started on August 3, according to the local People's Committee website.

Terra Wood's is the third renewable energy deal proposed to Vietnam in a week following a hydropower project run by the World Bank’s International Finance Corporation and Armstrong S.E. Clean Energy Fund and The Blue Circle’s wind energy project in Ninh Thuan Province.

Chairman of Quang Ngai People's Committee Tran Ngoc Cang welcomed the project and said the province will help facilitate the German investor's project. Cang also gave permission for Terra Wood to conduct research and surveys for the wind and solar electricity plants in Quang Ngai.The German-owned energy company will develop two electricity power plants, one wind and one solar, which will cover a total of 600 hectares with an output of 300 megawatts and total investment of $400 million.

Quang Ngai has immense potential for the development of wind and solar electricity, especially in the districts of Mo Duc and Duc Pho and the famous Ly Son Island. A number of foreign investors are also looking at electricity and renewable energy exploitation in Quang Ngai.

Beside Quang Ngai, foreign-invested solar and wind energy projects have been registered across the country, but only a few have been put into operation due to low electricity prices.

Terra Wood is an international group of consultancy, engineering and project development companies dedicated to green energy projects. Within the network, Terra Wood Vietnam is the country representative of Germany's ProfEC GmbH, which specializes in turnkey wind, biomass, biogas, wind, solar and Clean Development Mechanism (CDM) projects.

Reference Resource: Bao Vnexpress

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Solar Energy Power Future in Vietnam

Although the initial investment cost for solar energy in Vietnam is high but it brings in opportunities for cheaper option than thermal power technology being used in Vietnam.

In other country, solar power plants are competing fiercely with the thermal power plants running on coal.

In Vietnam, Thien Tan solar energy plant has been started to construct on 24 ha land in Quang Ngai with capacity of 19.2 MW at investment of VND 800 bil.  The Ministry of Industry and Trade has also approved the investment project of Tuy Phong solar energy plant on 50 ha land in Binh Thuan with capacity of 30 MW at investment of VND 1,454 bil.  This will open opportunities for renewable energy to contribute to the effort of protecting the environment and curbing climate change.

The solar energy is new in Vietnam therefore the investment in this area is at very early stage.  However, the foreign investors have been increasingly interested in seeking opportunities in investment in solar energy projects.

Similar to investment in wind power energy in Vietnam, one of the concerns for investors is the expected increase in purchasing price from Electricity Vietnam Corporation, the party whom purchase the electricity on Power Purchase Agreement (PPA).   Further, legal frameworks for promoting solar energy investment are not yet finalized.  Accordingly, the contribution ratio of renewable energy in Vietnam is minimal.  The Vietnam government has been trying to put some effort to increase the renewable energy contribution to 5,6% (in 2020) and 9,4% (2030).

 To achieve this, Vietnam government shall need to be consulted on plan to support the solar energy investment project in Vietnam in tax, land, capital, power purchase agreement.  Investors would need to be consulted by local consulting firm on process, procedures on investment policy, appraisal process, power purchase agreement, and other steps to develop and execute an energy project in Vietnam to improve the effectiveness of the investment in renewable energy.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn

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