3 key reforms that promote investment in energy

HANOI, July 6 (Engineering Daily) -- To face with the lack of investment capital in the energy sector, three key reforms to help Vietnam attract more capital flows in this area are proposed.

Firstly, the Ministry of Industry and Trade should soon approve some renewable energy projects that are allowed to implement the direct power purchase agreements (DPPA) with any large power purchaser that wants to use clean energy to encourage renewable energy development.

Secondly, the Ministry shall issue a Power Price Roadmap for the full introduction of Market-Based-Pricing by 2020 with a vision to 2025, including definition of variable pricing between the three main tariff groups (residential, commercial and industrial). The provision of actual cost information can empower businesses, consumers and investors as to the most effective way to invest in higher efficiency equipment and processes.

Thirdly, the government should encourage the strong development of partnerships with the private sector in order to attract more investment from this economy into energy development.

The above reforms are designed to help Vietnam better overcome the current challenges caused by energy demand increase. Furthermore, it could enable Vietnam to adopt an substantial action plan to ensure energy security.