Maintenance work on a high-voltage power line in Vietnam

Core area “Climate and energy, just transition” Increased use of renewable energy, adaptation to climate change

Viet Nam's growing economy means that the demand for electricity is also growing at an enormous rate – and as a result, so are the country's greenhouse gas emissions. At the same time, Viet Nam is one of the countries that are particularly vulnerable to climate change. Germany has been supporting Viet Nam's energy transition.

Renewable energy and energy efficiency

Until recently, hydropower, coal and natural gas each accounted for one third of energy generation in Viet Nam. However, since 2017, the country has rapidly increased the share of solar and wind energy, bringing it to one third. This is the first milestone in Viet Nam's energy transition. Viet Nam wants to continue along this road. For example, it has resolved not to build any new coal-fired power plants after 2030.

And at the COP26 climate conference in November 2021, Viet Nam announced that, with international support, it seeks to achieve net zero emissions by 2050 and exit from coal by the end of the 2040s. In order to implement Vietnam's ambitious climate goals, an energy transition partnership (Just Energy Transition Partnership) was concluded with the G7 in December 2022. It wants to gradually replace the share of coal in the energy mix (which is still high) by renewable energy (especially on-shore and off-shore wind energy) and by natural gas. At the same time, Viet Nam's power grid is considered to be outdated. It will have to be modernised, not least with a view to integrating volatile power generation from solar and wind power. This is already being pursued on the basis of a smart grid. In addition, the country is undertaking great efforts for energy efficiency, as Viet Nam has the most energy-intensive economy in the region, which means that there is a lack of efficiency.

An employee of Sao Mai Corporation works on a rooftop solar installation in Vietnam.

An employee of Sao Mai Corporation works on a rooftop solar installation in Vietnam.

An employee of Sao Mai Corporation works on a rooftop solar installation in Vietnam.

As part of its development cooperation with Viet Nam, Germany assists the relevant Ministry and authorities and Viet Nam's public power company in building their capacity, improving the legal and technical framework with a view to making the energy supply sustainable and enhancing energy efficiency, and reducing market barriers in the sector for domestic and international investors.

One key element is the effort to encourage decentralised power generation through solar roofs, especially by industrial and commercial enterprises, in order to make use of these currently unused areas and generate power in locations that are close to consumers. In addition, it is intended to introduce “dual use” of land, that is, the combination of agricultural production and solar power generation (agrivoltaics). To that end, the BMZ supports cooperation between Vietnamese and German institutions of higher education and private enterprises.

Climate change mitigation and adaptation

In order to deal with the consequences of climate change, the Vietnamese government needs to develop climate projections, improve land and water management across all provinces, invest in coastal protection, and adapt value chains in agriculture and aquaculture to the changed environmental conditions. The BMZ assists its Vietnamese partners in planning and financing relevant programmes and implementing them together with the private sector and civil society.

Sustainable urban development

The urbanisation rate in Viet Nam is 40 per cent. About one third of the country's 870 cities are located on the coast, which is threatened by climate change. In 2019, the Vietnamese government adopted a new planning law. It has also presented a plan for the sustainable development of smart cities and adopted a Resolution on “Planning, construction, management and sustainable development of Vietnam's urban areas up to 2030, with a vision to 2045”. On the basis of these documents, the government is undertaking the first steps to respond to climate change and to address the significant gaps and contradictions regarding urban planning, urban development and infrastructure management, and the lack of systematic attention for urban climate resilience.

As at: 22/06/2022