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Ministry says no to proposed BOT thermal power project

Experts applaud Vietnam’s decision not to license the 1,200 MW Vung Ang II coal-fired thermal power project, saying that this is a ‘necessary caution’.

Vung Ang I thermal power plant, Vung Ang industrial zone, Ky Loi commune, Ky Anh district, Ha Tinh province in Vietnam.

By Reporters

Hanoi, July 16, 2018

VietnamNet

Experts have applauded the Ministry of Planning and Investment’s (MPI) decision on not licensing the Vung Ang II BOT (build, operation, transfer) coal-fired thermal power project, saying that this is a ‘necessary caution’.

Pham Pho, former rector of the Sai Gon Economics & Technology College, said there are many reasons for Vietnam to refuse coal-fired power projects.

First, developing coal-fired thermopower plants is on the decrease in the world.

Second, there are bad consequences to the environment, including greenhouse gas emissions, dust, smoke and other toxins.

Third, most coal-fired power projects in Vietnam run with imported technologies. If Vietnam continues developing coal-fired thermal power, it will have to import equipment and technologies.

Low technologies will consume a lot of fuel and cause serious pollution. If so, Vietnam will become a technological dumping ground for the world.

Pho also sees problems with BOT-mode investment. These include the possibility of relying on selling prices set by investors and difficulties in controlling the quality of project execution.

If the projects are not managed well, outdated technologies will be brought to Vietnam and generate low-quality plants. If so, when Vietnam receives plants from the investors, they will be just like ‘piles of rusty iron’.

Vietnam needs to take responsibility for sales outlet of the project’s products.

MPI also pointed out problems existing in many BOT projects that lead to project implementation delays and other consequences to the state budget and the economy.

“I can see that MPI is prudent when assessing BOT projects, especially BOT projects in coal-fired thermal power,” Pho commented.

He went on to say that the project refusal will help prevent pollution, import of outdated technologies and reduce low-quality BOT coal-fired power projects.

Nguyen Minh Due, chair of the Vietnam Energy Science Council, also applauded MPI’s decision, emphasizing that Vietnam needs to be cautious with all coal-fired power BOT projects.

With BOT projects, enterprises build plants with their own money and transfer to Vietnam for operation after they use the plants for 15-20 years and are able to recoup their investment capital.

If the projects are not managed well, outdated technologies will be brought to Vietnam and generate low-quality plants. If so, when Vietnam receives plants from the investors, they will be just like ‘piles of rusty iron’.

Due said that as the investment rate of clean energy remains high, it is still impossible to replace all coal-fired plants in Vietnam with wind or solar power plants.

However, he stressed that reducing coal-fired power plants is a growing tendency in the world to which Vietnam cannot turn a blind eye.

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