The conclusions of the Standing Government on Power Development Planning VIII

On August 20, 2022, at the Government headquarters, Prime Minister Pham Minh Chinh chaired a Meeting of the Government Standing Committee on PDP VIII.

Attending the meeting were Permanent Deputy Prime Minister Pham Binh Minh, Deputy Prime Ministers: Le Minh Khai, Vu Duc Dam, Le Van Thanh, Minister of Industry and Trade (MOIT) Nguyen Hong Dien, Minister of Planning and Investment Nguyen Chi Dung, Minister of Natural Resources and Environment Tran Hong Ha, Minister and Chairman of the Government Office Tran Van Son, Government Inspector General Doan Hong Phong, Chairman of the State Capital Management Committee at Enterprises Nguyen Hoang Anh, Leaders representing ministries and agencies: Industry and Trade, Finance, Agriculture and Rural Development, Construction, Justice, Defense, Public Security, State Bank of Vietnam, Government Office. Chairmen of the Members' Council of Vietnam Electricity (EVN), Vietnam Oil and Gas Group (PVN), Vietnam Coal and Mineral Industries Group (Vinacomin) and Representative of the Institute of Energy (The Institute establishing PDP VIII).

After listening to the main contents of PDP VIII reported by MOIT and the opinions of the meeting participants, the Government Standing Committee concluded as follows:

Firstly, PDP VIII is a very important national sector planning, which should be carefully considered before approval and must firmly ensure national energy security, and sufficient electricity supply for socio-economic development and people’s life. However, this is also very difficult planning, especially in the context that there are many fluctuations in energy and energy transition in the world due to geopolitical and geo-economic issues, changes and speed up the development of energy technology and the requirement to implement the international commitments of Vietnam on the climate change prevent.

Secondly, The Prime Minister has guided throughout on a number of key principles and viewpoints in the process of finalizing PDP VIII. Specifically:

1/ Putting national interests and national interests first and foremost; must not be for the local, regional, or group interests, to have an impact on the objectivity, science, effectiveness, and optimization of the planning.

2/ Sticking to the policy and orientation according to Politburo's Resolution 55 on the orientation of Vietnam's national energy development strategy to 2030, with a vision to 2045 (Resolution No. 55-NQ/TW).

3/ Must aim at measures to reduce greenhouse gas emissions to achieve net emissions of "zero" by 2050 as Vietnam's international commitments at COP26 (concretized in the National Strategy) on combating climate change in the period up to 2050 in the Prime Minister's Decision No. 896/QD-TTg dated July 26, 2022).

4/ It is necessary to consider the overall optimal planning and for 5 specific stages in close relationship with each other, including a Power source, power transmission, electricity distribution, efficient use of electricity and electricity prices. It is necessary to ensure the most optimal planning, towards the highest internal regional balance, to reduce long-distance power transmission, to reduce power losses, to have solutions for calculating the most reasonable, transparent and competitive electricity prices and by the market mechanism.

5/ It must be feasible to ensure sufficient electricity supply for production, business and people's life, absolutely not to happen electricity shortage in every situation. The electricity prices, especially the prices of wind and solar power projects

must be reasonable with Vietnam's conditions and not higher than other countries in the region,

6/ It must resolve the shortcomings and inadequacies in the management and implementation of PDP VII and adjust PDP VII; to use reasonable and effective content, but not to legitimize the wrong things and make reasonable and effective solutions for handling the problems arising from objective reality and ensuring the interests of the country and electricity users.

Thirdly, Highly appreciating MOIT, under the close direction of Deputy Prime Minister Le Van Thanh, has completed the PDP VIII with many new and superior points compared to Reporting Document No. 1682/TTr dated March 26, 2021. The contents of PDP VIII have basically followed the directions of Deputy Prime Minister Le Van Thanh, Prime Minister, Standing Government and Resolution No. 55-NQ /TW dated February 11, 2020, of the Politburo on orientations of Vietnam's national energy development strategy to 2030, with a vision to 2045; At the same time, there were many efforts to concretize the solutions to implement Vietnam's international commitments at the Conference COP26.

However, a number of contents of PDP VIII need to be continuously carefully studied and comprehensively, totally analyze, especially the transition to green energy, making the most of Vietnam's advantages to complete PDP VIII tasks.

Fourthly, MOIT should study and collect opinions from participants in the meeting; assume the prime responsibility for, and coordinate with relevant ministries, and agencies in reviewing and continuing to finalize PDP VIII, focusing on implementing the following contents:

1/ Updating and synchronously calculating the contents of the Electricity Master Plan VIII with a vision to 2050 (because the basic national and sectorial plans take the timeline to 2050).

2/ Continuing to review power plants in the direction of reducing coal power plants in period up to 2030.

Besides, the projects not included in the PDP VIII as reported (it must confirm that there are no legal consequences and no complaints), MOIT continuously works with the investors on the implementation of coal-fired power projects with many difficulties and obstacles in a capital arrangement to unify on whether to continue or not coal power projects in the current conditions or handle the other option.

3/ Reviewing the feasibility schedule of the thermal power projects using domestic gas. At the same time, to calculate and balance reducing the capacity of power plants with imported LNG by 2030 and increasing the wind power projects with reasonable and feasibility scales.

It is necessary to calculate for maximal, effective, and reasonable exploitation of renewable energy on electricity prices (due to the day-by-day development of renewable energy technology and their costs reduced over time).

4/ Regarding the solar power projects in the period to 2030, it is necessary to review to ensure the overall economic efficiency, avoiding economic damage, especially the unreasonable calculation of electricity prices; at the same time do not legitimize wrong things. Thoroughly research and evaluate the impact of rooftop solar power projects for self-use purposes and not sold into the national power system.

5/ More calculating the scale of importing electricity from the neighboring countries, especially from Lao PDR, increasing the flexible power projects as biomass, and hydrogen projects, especially where the conditions for afforestation and hydrogen production are available.

6/ Researching the orientation of necessary mechanisms and policies to ensure legal regulations to create favorable conditions in the implementation of PDP.

7/ Developing a total, comprehensive and long-term planning so that the process of managing and implementing the planning is both proactive and flexible, with little adjustment; at the same time, studying the decentralization and allocation of resources and promoting the responsibilities of all levels in the implementing management according to regulations of the laws.

8/ Coordinating with the ministries and agencies to carefully assess. In necessary cases collect opinions from relevant offices, especially those offices assigned by the Politburo and the Government to inspect, examine and supervise the implementation of Resolution No. 55-NQ/TW and the process of developing and implementing PDP.

Fifthly, Deputy Prime Minister Le Van Thanh is to continuously invest efforts in directing to finalize of PDP VIII and deploy the follow-up procedures as prescribed.

Sixthly, The Government Office should help Standing Government Committee to supervise and speed up and advise to finalize PDP VIII with ensuring the quality, efficiency, and feasibility, especially the synchronization of planning time with a vision to 2050.