Solar Incentives Energised

By Ngoc Linh

Incentives for solar and biomass energy will be issued this year to champion renewable energy.

Tran Tuan Anh, Deputy Minister of Industry and Trade, told the Vietnam Business Forum (VBF) recently that the ministry was studying a policy to encourage private investors to invest in solar and biomass energy projects.

“We can promulgate this policy at the end this year,” Anh said.

He said the policy, in line with an incentive mechanism for wind energy development which took effect last June, would accelerate future renewable energy development in Vietnam.

“I understand the concerns of investors about how much the government will subsidize renewable energy prices. This will be settled in the upcoming policy and there will be investment incentives regarding infrastructure, human resource training and taxes,” said Anh.

The Vietnamese government has strongly called for investment into renewable energy projects in the face of severe nationwide electricity shortages and dwindling coal and crude oil resources.

According to the power development plan for 2011-2020 with the vision to 2030, Vietnam plans to raise the proportion of renewable energy to 6 per cent of total power supply by 2030 from 3.5 per cent in 2010.

However, domestic and foreign investors’ heads have yet to be turned.

The government provides support for wind power development through Decision 37/2011/QD-TTg and as a result, investors like Belgium’s Enfinity, Norwa’s SN Power and Malaysia’s Timar Wind Solar Energy Group have registered to invest in wind power projects, but not in biomass or solar power projects.

According to a VBF Infrastructure Working Group report, the renewable energy master plan’s targets appeared out of reach if the government did not issue a comprehensive renewable energy plan including, solar power, biomass and biogas in addition to wind. Further more, the group also asked the government to issue effective feed-in tariffs for each energy source that delivers a cost, plus reasonable economic profit to investors.

“Renewable energy development needs a sound indicative policy from the government,” said Tran Anh Vuong, vice chairman of Hanoi Young Business Association. He said while neighbouring countries made huge leaps in relation to this energy source with aggressive policies, Vietnam even with its “endowed” potential, lacked a crystal clear policy to seize opportunity./. VIR

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