WB and GIF support Vietnam in Solar Pilot Auction Program

WB and GIF support Vietnam in Solar Pilot Auction Program - 

The Governing Council of the Global Infrastructure Facility (GIF) has approved a fund US$ 1.5 million for supporting the World Bank (WB) and the Vietnamese Government to implement the Solar Pilot Auction Program. 

According to The GIF in coordination with the Energy Department of WB will help Vietnam to design and build the Auction Program to transition from feet in tariff (FIT) mechanism to a sustainable competitive auction scheme for SPPs that will create a favorable environment for the private sector to participate in the renewable energy development.

The WB Country Director for Vietnam Osmane Dione said that WB is closely working with the Vietnamese Government to bring more private resources to energy sector where the financial needs are huge and urgent.

The support of GIF comes at a critical time to help Vietnam overcome current challenges to further promote solar power development, including financial investment and risk allocation, Mr.Osmane Dione added.

And Mr. Jason Lu - Director of GIF said that the competitive bidding program for SPPs of the Ministry of Industry and Trade is part of the Government's efforts to promote investment in energy saving and renewable energy, increase diversification of electricity generation sources, reduce CO2 emissions. Vietnam aims to install 12GW of grid-connected solar power by 2030.

This will be the first solar auction program to be launched in Vietnam, with potential for large scale replication. We are delighted to assist the Government of Vietnam in mobilizing private financing through standardized, transparent and systematic approaches.

According to GIF Director: Although Vietnam's economic prospects are still positive, with forecasts for growth to continue to reach 6.5% in 2020 and 2021, Vietnam still faces many challenges in meeting infrastructure development needs, especially the growing demand in the energy sector.

Vietnam is actively attracting private investment and using a public-private partnership in the energy sector, but it is necessary to adjust the current framework to allow competitive options for independent power producers and reduce the costs of solar power generation. With the support of WB and GIF, the Government of Vietnam is developing competitive bidding mechanisms for large-scale solar PV deployment.

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