Nhon Trach 3 and 4 Thermal Power Plants are preparing to generate commercial electricity in the fourth quarter of 2025 - Photo: NGOC AN
The information was given by Mr. Nguyen Quoc Thap - Chairman of the Vietnam Petroleum Association - at the annual oil and gas and energy forum 2025: Energy transition - vision and action organized by the Vietnam Petroleum Association and the Vietnam National Energy and Industry Group ( Petrovietnam ) on July 28.
Low electricity mobilization due to high prices?
According to Mr. Thap, the biggest concern for gas-fired power plants is the low level of electricity consumption at LNG thermal power plants. Evidence from Nhon Trach 1 gas-fired power plant or Lan Tay gas-fired power project shows that the mobilization level is much lower than the supply capacity.
Similarly, two billion-dollar projects such as Nhon Trach 3 and 4 gas-fired thermal power plants have been completed and are ready to generate electricity, but the mobilization of electricity is still a "big question". According to Mr. Thap, the reason is that Vietnam Electricity Group (EVN) is the buyer of all electricity sources to sell to customers, mobilizing in order of priority from low to high price.
This leads to the consequence that LNG electricity has a high price - it is not a priority source of electricity in mobilizing the power system, especially when this year hydroelectricity has a lower price due to more abundant water resources, so it is mobilized more.
According to Mr. Thap, Decree 100 of the Government on the mechanism for developing gas-fired thermal power projects, which has just been issued, has introduced mechanisms such as transferring gas prices to electricity prices.
In addition, a long-term minimum electricity output guarantee policy of no less than 65%, applicable for 10 years, has also been implemented. However, in reality, many obstacles in operating plants and attracting investment in gas-fired thermal power have not been resolved.
According to EVN, in the first 7 months of 2025, the mobilization rate of gas-fired electricity accounted for 6.6%, down from 8.2% in the same period last year. Meanwhile, the mobilization rate of hydropower accounted for 23.5%, up from 22.8% in the same period.
Mr. Nguyen Duy Giang - Deputy General Director of Vietnam Oil and Gas Power Corporation (PV Power), the investor of Nhon Trach 3 and 4 gas-fired thermal power plants with a capacity of up to 1,624 MW, expected to generate commercial electricity in the fourth quarter of 2025 - affirmed that one of the biggest problems is the mechanism for transferring gas prices into electricity prices.
There needs to be a direct electricity trading mechanism.
According to Mr. Giang, although the mechanism of transferring gas price to electricity price has been allowed to be implemented with Nhon Trach 3 and 4 projects, the structure of annual output consumption rate at 65% is assessed by foreign investors as inappropriate, below the break-even level.
Therefore, along with the relatively complicated investor selection mechanism, the output underwriting mechanism with the rate are the two biggest barriers to attracting investors to the electricity sector.
Mr. Giang said that according to the Power Master Plan 8, LNG has about 15 projects and recently added Hai Phong projects, increasing the number to about 16 - 18 LNG projects, playing a very important role in developing electricity.
However, investors still expect this ratio to increase from 80 - 90% within 15 - 20 years. "Apart from the Nhon Trach 3 and 4 projects that have been implemented, the remaining projects are still at the investment level and I think it is relatively difficult to operate before the 2028 - 2030 period," Mr. Giang assessed.
Meanwhile, according to Mr. Thap, to solve the problem of output consumption, it is necessary to recognize that the output market of LNG electricity is not the common market, but rather industrial consumers and large consumers who want a long-term commitment.
These will be the households that will ensure the commitment to consume electricity output and imported gas output, instead of the current regulation of assigning it to EVN and ministries.
In fact, many investors and industrial zones are electricity customers who want to be fully informed about the input information on energy used in production. These customers are also interested in the ability to provide electricity long-term or not, ensuring regular and continuous supply.
Because with the current situation of electricity input, investors cannot fully disclose information on electricity usage.
"Therefore, it is necessary to have a direct electricity trading mechanism, where the generator negotiates directly with the electricity buyer, applicable to both LNG power projects and renewable energy plants to ensure long-term output consumption, attracting investors," said Mr. Thap.
Great demand, policies not attractive enough for investors
Mr. Nguyen Duc Hien - Deputy Head of the Central Policy and Strategy Committee - said that with the need for energy transition up to 135 billion USD, State resources are limited, so having a mechanism to attract the private sector is a requirement.
Therefore, reforming the energy market, electricity prices, and coordination mechanisms when separating the competitive power dispatch center is a step, but it needs to be further improved to separate the market hierarchy between wholesale and retail to promote the efficient use of electricity sources.
Meanwhile, according to Mr. Nguyen Quoc Thap - Chairman of the Vietnam Oil and Gas Association, the policies for developing electricity are still not attractive enough for investors, when there is no government guarantee to guarantee loans for State projects, and no mechanism to guarantee foreign currency conversion. The planning is still lacking and not synchronized, especially the detailed planning from port warehouses, LNG, storage, power plants, transmission grid, distribution to industrial clusters...
"Furthermore, the criteria for selecting investors are not unified when the Power Plan 8 and the new National Energy Plan provide some principled addresses, while gas enterprises want to build and develop into clusters and gas power chains," said Mr. Thap.
Source: https://tuoitre.vn/dau-tu-hang-ti-usd-dien-khi-lng-van-e-20250728225914803.htm
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