Resolution 55 creates new opportunity for Vietnam’s energy

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The Vietnam Energy Summit 2020.

State monopoly in energy still high

According to Nguyen Van Binh, Head of the Central Economic Committee, energy is an economic and technical industry that plays an important role, serving as a foundation for the country's socio-economic development. Energy development is a key strategic task to implement the goal of industrialisation and modernisation of the country.

After years of implementing the 10th Politburo's Resolution No.18/2007/NQ-BCT on the “Orientation of Vietnam’s national energy development strategy to 2020, vision to 2050” and Conclusion No.26/2003/ KL-BTC of the 11th Politburo on strategy and planning for development of Vietnam's electricity industry,the energy industry, especially the field of electricity, has developed rapidly and synchronously in all energy sub-sectors and fields.

However, Binh emphasised that Vietnam’s energy industry is still limited. The implementation of the goal of ensuring national energy security still faces many challenges, local supply has not yet met demand, Vietnam has imported increasing amounts of energy, many power projects are behind schedule and plans while some indicators of energy security are fluctuating in theadverse direction.

"State monopoly in the energy sector is still high, the energy price policy is still inadequate, not entirely consistent with the market mechanism and isnot separate from social security policy," Binh said.

Vietnam’s energy industry has mobilized large resources for energy infrastructure development, especially from private sources, Deputy Prime Minister Trinh Dinh Dung said, adding that that the energy industry is facing many difficulties and challenges, with many shortcomings that need to be removed.

“Especially, primary energy sources (such as coal and gas) aredeclining, leading to the import of this energy source from foreign countries. This reduces Vietnam’s energy autonomy and increases its dependence on other economies,” the Deputy Prime Minister noted.

Goods mechanisms are needed to mobilize resource

These shortcomings are also why the Central Economic Committee advised the Politburo to promulgate Resolution No. 55-NQ/TW dated February 11 on the “Orientation of Vietnam’s national energy development strategy to 2030, vision to 2045”.

After being issued, with new, strong and breakthrough provisions on national energy development, Decree 55 has been highly appreciated by domestic and internal organisations and business communities; created strong responses and consensus in the entire political system.

Based on creatively applying the orientations and solutions in the Resolution into practice, some localities and enterprises have researched, proposed, promptly handled and removed difficulties and problems to develop energy; the development and supplementation of planning on power source projects, especially renewable power sources, has been focused and improved effectively.

To implement Resolution 55, Deputy Prime Minister Trinh Dinh Dung said one of the key tasks directed by the Government is institutional improvement.

“Institutional improvement is a key task in mobilizing resources for energy development. From now to 2025, Vietnam needs to increase 5,000 MW of power, thereby; Vietnam needs approximately US$7-10 billion to develop power sources, excluding capital sources to develop transmission systems. The Government determines that the key task is to revise the Electricity Law, the Petroleum Law, the Law on Economical and Efficient Use of Energy and may develop a new Renewable Energy Law,”the Deputy Prime Minister said.

The resolution provides many new contents in the direction of national energy development to ensure national energy security, boost the country's industrialisation and modernisation process, Tran Tuan Anh, Minister of Industry and Trade, affirmed that this resolution has removed shortcomings and created a new opportunity for Vietnam's energy sector.

“Resolution 55 has opened new opportunities, allowing us to believe in a strategy with new mechanisms and policies, including the legal framework, to orient development and ensure national energy security," Minister Tran Tuan Anh said.