The Ministry of Industry and Trade says in a report that 47 of 62 approved power plants are behind schedule by a few months to as long as five years. Most of the projects are located in the south.
One of the reasons for the delay in power projects is the lack of coordination between electricity planning and other areas like traffic, land and urban planning.
Some projects have been modified several times because contractors need to choose new locations for substations to avoid stepping on existing plans of other areas.
Land acquisition is another challenge as locals refuse to accept compensation, saying it is too low.
Another reason for power shortage is a lack of raw material. The supply of gas needed to fuel the Phu My Thermal Power Plant in the southern Ba Ria-Vung Tau Province, one of the major power producers in the country, is set to reduce, the report says.
“If the generators from these new projects are not reliable or there is a lack of material such as coal, there might be a power shortage in 2020,” the report says.
It estimates the power shortage at 3.5 billion kWh in 2021 and rising to a peak of 12 billion kWh in 2023 before falling to 3.5 kWh in 2025.
The government plans to increase the country’s power capacity by 6.900 MW this year and the next with new power plants becoming operational. Solar and wind projects are set to contribute 55 percent of the increased capacity, 36 percent is to come from coal-fired power plants and 9 percent from hydropower plants.
The plant will see a shortage of 3 billion cubic meter of gas in 2024, and this figure will rapidly rise to 10 billion in 2030.
Vietnam Electricity (EVN), the national power utility, said last month that Vietnam was seeing a surge in electricity demand as summer heat intensifies while water shortage constrains power production.
The national grid will have its capacity increased by up to 1,400 MW by the end of June with 90 new solar power plants becoming operational.
But this is more a challenge than an opportunity, as technical difficulties in the initial period will not guarantee stability and quality, said Nguyen Duc Ninh, deputy director of National Load Dispatch Center under EVN.
Despite the challenges it is facing, EVN has said it will ensure sufficient power supply this year.
Vietnam’s rapid economic growth in recently years has increased its energy needs significantly.
World Bank country director for Vietnam, Ousmane Dione, said earlier that Vietnam would need to raise up to $150 billion by 2030 to develop its energy sector. He said electricity demand in the country is set to grow by about 8 percent a year for the next decade.