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Vietnam Considers Buying Electricity From Laos to Ease Reliance On China

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Vietnam may import electricity from Laos to minimize the risks from relying on Chinese imports and to offset supply shortages caused by cutting off power sources which pollute the environment. Deputy Prime Minister Trinh Dinh Dung has urged the Ministry of Industry and Trade to submit the master plan to develop power generation sources by 2025, emphasizing that it is necessary to diversify the power supply sources and consider the supply from Laos.

Le Van Doanh from the Hanoi Vocational College of Technology said that Lao hydraulic power potential was high. The country is planning to build more hydropower plants in the time to come, and oversupply is anticipated.

Meanwhile, Vietnam’s power demand is very high. In 2015-2016, Vietnam put out 150 billion kwh of electricity and it needs more than 200 billion kwh of electricity by 2020 to run factories and satisfy daily needs.

In order to generate more power, Vietnam has built some large coal thermopower plants while planning to import coal at high prices to run the plants.

Regarding hydropower development, Vietnam has built power plants on all large rivers like the Da and Yaly.

“Ninety percent of Lao electricity from hydropower plant is for sale. If Vietnam buys electricity from Laos, this will benefit both sides,” he said.

Agreeing with Doanh, Tran Dinh Long, deputy chair of the Vietnam Power Association, said Laos has supply exceeding demand and is likely to sell electricity to Vietnam.

He said if Vietnam buys electricity from Laos, it can avoid the burning of coal and build more coal power plants, which would help protect the environment.

The electricity output from coal power plants accounts for an increasingly high proportion of total electricity output in Vietnam. Meanwhile, wind and solar power cannot ensure sufficient electricity to the country.

There is another important reason for Vietnam to consider buying electricity from Laos. This will help diversify the supply sources and ease reliance on China.

Vietnam now imports electricity from China every year, about 5 percent of total electricity volume needed. With more supply sources, Vietnam would have the right to choose more suitable suppliers and haggle for better prices.

However, Doanh warned that even if Vietnam buys electricity from Laos, the retail electricity price in Vietnam won’t fall.

“The retail electricity price in Vietnam is the lowest in the world, at VND1,500-2,000 per kwh,” Doanh said, adding that the price in Thailand is 50 percent higher, while the price in Germany is three times higher.

Source: Vietnam Net Bridge