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Illustration. Source: Internet

No shortage of coal in 2019

According to a recent report by the Department of Electricity and Renewable Energy (Ministry of Industry and Trade), traditional thermal power sources using coal and gas continue to play a key role in ensuring the security of electricity supply. However, the supply of coal and gas for electricity generation is facing many difficulties.

In recent years, demand for coal for electricity production has increased, from 26.25 million tonnes in 2015 to 44.37 million tonnes in 2018 (up 69 percent).

In 2019, coal demand for electricity is 54.3 million tonnes, of which demand for anthracite coal is 44.5 million tonnes. The ability to produce domestic anthracite coal to supply electricity for the Vietnam National Coal and Mineral Industries Group (TKV) and the Northeast Corporation is currently about 36 million tonnes (equal to 80 percent of the demand), so it has to import export and blend coal to ensure consumption demand.

In the coming years, the demand for anthracite coal will continue to rise when some new factories come into operation such as Hai Duong, Nam Dinh, Thai Binh 2, Bac Giang and Cong Thanh so the situation will be more difficult.

The recent electricity supply meeting at the Ministry of Industry and Trade, Nguyen Viet Son - Director of the Petroleum and Coal Department (Ministry of Industry and Trade) said that according to the contract signed in 2019, there is no shortage of coal.

"Vietnam Oil and Gas Group (PVN) always complain but when obtaining a mechanism removed, the corporation complains again. The lack of coal is mainly from PetroVietnam Power Corporation (PVPower), who complained a lot, but according to the contract, there is no shortage,” Son emphasised.

At a recent Government meeting on solutions to ensure electricity supply in the coming time, coal for electricity was also mentioned. Prime Minister Nguyen Xuan Phuc agreed if TKV did not provide enough coal, power plants could import coal to ensure electricity generation.

The PM asked the Ministry of Industry and Trade to chair, together with Electricity of Vietnam (EVN), TKV, PVN, and the State Capital Management Committee at the enterprise to coordinate in providing enough coal and gas for each factory, ending the shortage of coal as happened in the past.

Son said that in 2020, domestic coal production capacity for electricity will be 35 million tonnes, and the shortage of 24 million tonnes must be imported. The Prime Minister has dispatched the responsibility to import coal to responsible investors. The Ministry of Industry and Trade has directed many times, requiring investors to sign long-term coal supply contracts by 2030. Currently, half of the units have signed long-term contracts, the rest will continue to urge.

Setting up the actual inspection team

Facing PV Power's lack of coal, Minister of Industry and Trade Tran Tuan Anh proposed setting up a working group to re-examine the supply of coal of TKV and Northeast Corporation to PVN's power plants, directly from PVPower.

According to Minister Tran Tuan Anh, PVPower's information and reflection is very short of coal, sometimes the coal output in warehouses is only enough for a few days of operation. Meanwhile, PVPower said TKV did not comply with coal supply contracts.

“Units check, if there is any problem, they must draw experience and reorganise, and give suggestions for long-term coal supply to be ensured. To set up a working group, one week must report again, not just wait for the report of PVN or TKV,” said Anh.

In the coming time, to prepare coal for electricity, the Ministry of Industry and Trade asked TKV and Northeast Corporation to implement solutions to increase short-term domestic coal production; diversifying coal screening, processing and mixing methods to produce coal types suitable for electricity production to ensure sufficient supply of coal and electricity for electricity production.

Regarding coal trading contracts, the Ministry of Industry and Trade requested and urged investors of coal-fired power plants to coordinate with TKV, Northeast Corporation and other suppliers to sign contracts in buying and selling coal in accordance with the law; urgently completing long-term coal trading contracts to serve as a basis for making and approving long-term coal supply charts for coal-fired thermal power plants, in which clarifying domestic coal, imported coal and coal and mixing is expected to provide coal-fired power plants.

In the long term, the Ministry of Industry and Trade stated it will develop and approve the coal supply diagram for electricity production (long term: 10 years; medium term: five years), build an annual coal supply plan for production; coordinating with the Ministry of Science and Technology, EVN and other coal-using households to study the technology of using coal mixed with coal for electricity production under the direction of Deputy Prime Minister Trinh Dinh Dung at the meeting on November 28, 2018.