28^th March 2024

UNDP and Viet Nam Institute of Energy (IOE) have been undertaken a case study to assess the energy transition scenarios of coal-thermal power plants in Viet Nam, focusing on Pha Lai 2 (2x300MW), Cao Ngan (115MW), and Van Phong 1 (2×660 MW) plants in consideration of costs and benefits potentially incurred from this process. The study is expected to help formulate bankable proposals for decommissioning, repurposing and/or refurbishing of these plants, event these would be very preliminary results, as enphasied from the IoE and from three power plants management. In additional to these three case studies, the World bank has presented a case study on Repurposing options for Ninh Binh coal fired power plant (4×25 MW).

To share and consult the study results, UNDP and IOE jointly organize a technical meeting on Assessment of scenarios of taking coal-thermal power generation in Viet Nam to net-zero GHG emissions by 2050. The objective of this technical meeting is to provide updates on the transition of coal-thermal power plants, international experience on Best Available Technology (BAT), costs, benefits, and potential impacts of the transition. It will also discuss various options for the decommissioning, repurposing, and refurbishment of different coal-thermal power plants, followed by financing opportunities from various windows including the implementation of JETP Resource Mobilization Plan and operation of voluntary carbon market.

This meeting brings together key stakeholders from a variety of sectors, including government agencies, members of the International Partnership Group (IPG) and GFANZ, coal-fired power plants, financial institutions, banks, investors, development partners and NGOs, to discuss the results of case studies.

“Our dependence on coal power generation poses significant challenges to sustainable development and energy security” – Ms. Ramla Khalidi, Resident Representative of UNDP Vietnam affirmed – “ Gradually phasing out coal power is a necessity, not an option, to reduce carbon emissions for the Vietnamese economy and achieve the net zero emissions target.” To do this, Ms. Ramla emphasized the importance of coordination between parties to minimize challenges and the need for a fair and inclusive transition process.

This is one of the hot topics for PDP8 implementation plan and JETP RMP whichs are under heavy debates since last months. Viet Nam has been experiencing a rapid economic growth for the past quarter-century which is primarily powered by fossil fuels. Coal remains the dominant primary fuel for production of domestic energy, accounting for half of the power supply. Its dependence on coal-fired power generation poses significant challenges to decarbonization of Viet Nam’s energy sector. As Viet Nam strives to meet the global target set by the Paris Agreement, it is imperative to explore the pathways that lead to net-zero emissions. This technical meeting has drawn attention with many participations from private sector, development partners, and from technical research groups as well as from the management and staff of the coal-fired power plants under study.

• Meanwhile, Pha Lai 2, 600MW capacity, 23 years of operation is also required to be converted. Some of the pathways considered for Pha Lai 2 include NH3 co-firing or flexible gas turbines, or BESS combined with flexible gas turbines and solar power, or BESS combined with gas turbines and SynCON. These strategies not only benefit the environment by significantly reducing greenhouse gas emissions, but are also important for enhancing the energy security and sustainability of the industry.
• Cao Ngan power plant is located in the center of Thai Nguyen city, so it requires compliance with strict environmental standards. The study emphasizes the plant’s ability to integrate with renewable energy sources. The study also shows the potential for incorporating solar and wind power into existing power generation systems, enhanced by Battery Energy Storage System (BESS) and Recovery Technology technologies, advanced carbon utilization and storage (CCUS). This approach could be a model to balance energy production with environmental protection.
• For Van Phong 1 BOT coal-fired power plant, the new and largest plant has a favorable location for integrating solar power and biomass co-firing. The study delves into various transition options, including pioneering small-scale nuclear power and repurposing plants to accommodate emerging technologies. The plant’s location is near the Phu Khanh oil reservoir, which can also be used as a CO2 storage facility. These transformational measures are in line with Vietnam’s emissions reduction goals and promise to invigorate the economy. local economy as well as promoting technological innovation. However, with any proposed solution, legal issues will arise regarding the BOT contract that will need to be renegotiated.

Apart from these preliminary technical case studies, the meeting has also discussed, with very active participation fron the audience on the International Best Available Technology for Coal Transition such as:

1. Addition of CO2 removal components to an existing coal-fired power generation facility
2. Refurbishing boilers to lower CO2 emissions or introduce co-firing capability
3. Refurbishing CFPPs for different operating modes such as synchronous condensers providing power system security services
4. Refurbishing sites (and the associated generator substation) of coal-fired power plants for use of alternative technologies such as PV, battery storage energy systems (BESS), wind (use location as a connection point), or small modular nuclear reactors (SMNRs)
5. Deployment of green technologies that are emerging such as green hydrogen, ammonia, methanol etc. which can be deployed on a stand-alone basis or co-fired in refurbished boilers

Key Lessons for Vietnam:

As per the PDP8, Vietnam presently operates approximately 20GW of coal plants, with projections indicating an increase to 30GW by 2030. Consequently, a significant number of coal plants will require repurposing to alternative technologies in the upcoming years. Key considerations for Vietnam to consider include:

• Converting to synchronous condensers and BESS to help control the electrical system for coal plants ( such as Pha Lai, Hai Duong, Dong Nai, Long An,..) which are close to load centers (Hanoi, Ho Chi Minh)
• Converting to solar and BESS for southern coal plants which have high solar radiation
• Explore whether the conversion of CFPPs near the coastline could support offshore wind farm  connection points in the future
• Converting to Biomass and later combined with CCUS to maintain stable energy generations with coal plants which are close to mining centers (Cao Ngan, Na Duong, Quang Ninh, Cam Pha,…)

The UNDP representative also noted in detail that a large number of workers working directly or indirectly in coal mining, transportation and electricity production activities, especially in remote areas, may affected by the cessation of coal use. “It is important to provide retraining and reskilling supports to affected workers and communities, and is necessary to ensure their participation and benefit from the process. this transformation process,” Ms. Ramla Khalidi said.

As Vietnam moves towards achieving net zero emissions by 2050, the results of this technical meeting are expected to contribute significantly to shaping a roadmap for a fair and equitable energy transition. in Vietnam and beyond.

Materials of the workshop could be found HERE