The TA will assist the Ministry of Industry and Trade (MOIT) in preparing relevant guidelines, roadmaps, and regulations for (i) a competitive market operation related to contract arrangement and prudential requirements under the Vietnam wholesale electricity market (VWEM) and (ii ) a mechanism ensuring long-term adequate supply, which can replace, improve, or complement the current mechanism through power development planning (PDP) and build-operate-transfer (BOT)
|Project Name||Power Sector Reform Program|
|Project Type / Modality of Assistance||Technical Assistance
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Governance and capacity development
Private sector development
|Sector / Subsector||
Energy / Energy sector development and institutional reform
|Gender Equity and Mainstreaming||No gender elements|
|Description||The TA will assist the Ministry of Industry and Trade (MOIT) in preparing relevant guidelines, roadmaps, and regulations for (i) a competitive market operation related to contract arrangement and prudential requirements under the Vietnam wholesale electricity market (VWEM) and (ii ) a mechanism ensuring long-term adequate supply, which can replace, improve, or complement the current mechanism through power development planning (PDP) and build-operate-transfer (BOT)|
|Project Rationale and Linkage to Country/Regional Strategy||Despite a significant progress made in the power sector reform in VIet Nam, there are still many challenges to be addressed Among others, developing competitive wholesale electricity market , while ensuring long-term adequate electricity supply, is a key issue. Although the market design and rules are well developed for the VWEM, there are remaining challenges related to the operation of the VWEM in terms of implementing the transition of contract arrangements from the Vietnam Competitive Generation Market (VCGM) to the VWEM, monitoring and supervising the competitive VWEM market operation, and developing market regulations related to market prudential requirements and tax treatments. At the same time, the mechanism to sustain investment for new generation capacity needs to be established. Currently new generation capacity is identified through power development planning (PDP) process and new investment is ensured through EVN or BOT arrangement. However, with the introduction of the VWEM, this centrally-planned approach will need be gradually changed to market-based approach. On the other hand, other countries' experiences show that a wholesale electricity market alone cannot ensure a long-term adequate electricity supply especially when there is a growing demand at high rates. Therefore, it is required to develop the appropriate mechanism to be compatible with the VWEM in the context of power sector reform in Viet Nam. Otherwise, there will be a high risk of lacking or delaying new investment, resulting in power shortage and excessive electricity price.|
|Impact||Adequate and reliable supply of power for socio-economic development|
|Description of Outcome||An improved regulatory framework and policy actions for competitive wholesale electricity market|
|Progress Toward Outcome||Key assessment and continuous consultation ongoing to improve Viet Nam's power sector to ensure that new generation capacity can be procured competitively and efficiently in time and least cost in a manner to be compatible with long-term Vietnam Wholesale Electricity Market.|
|Description of Project Outputs||
1. Key policy actions and regulations for competitive power market operation
2. Key policy actions and regulations to ensure long-term adequate electricity supply
|Status of Implementation Progress (Outputs, Activities, and Issues)||
1. Ongoing activities related to VWEM preparation since April 2018 consisting of VWEM contracting arrangement, prudential requirements and tax treatment and other preparatory works and capacity building support.
2. Continuous assessment of existing mechanisms to ensure long term adequacy of supply, development of options to improve long term adequacy of power supplies, and design adequate mechanisms to ensure competition in implementing investments.
3. Continuous liaising with key stakeholders, and provide technical and operational support to MOIT for necessary discussions on complexities of policy related to competitive auction mechanisms.
|Summary of Environmental and Social Aspects|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design||The MOIT and ERAV have been consulted for the TA design and development partners including the World Bank, AfD, and KfW coordinated.|
|During Project Implementation||2 stakeholder workshops, organized with MOIT, commenced since May 2018. 2 remaining workshops for government staff and stakeholders to be conducted until end of 2019.|
|Consulting Services||An international firm has been engaged. TA proceeds will be disbursed in accordance with the Technical Assistance Disbursement Handbook (2010 as amended from time to time).|
|Responsible ADB Officer||Lee, Hyunjung|
|Responsible ADB Department||Southeast Asia Department|
|Responsible ADB Division||Energy Division, SERD|
Ministry of Industry and Trade
54 Hai Ba Trung St.
Hanoi, Viet Nam
|Concept Clearance||09 Nov 2015|
|Approval||08 Dec 2015|
|Last Review Mission||-|
|Last PDS Update||29 Mar 2019|
|Approval||Signing Date||Effectivity Date||Closing|
|08 Dec 2015||10 May 2017||10 May 2017||31 May 2019||31 May 2020||-|
|Financing Plan/TA Utilization||Cumulative Disbursements|
|1,000,000.00||0.00||100,000.00||0.00||0.00||0.00||1,100,000.00||08 Dec 2015||271,814.37|
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|Title||Document Type||Document Date|
|Power Sector Reform Program: Technical Assistance Report||Technical Assistance Reports||Dec 2015|
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No tenders for this project were found.
|Contract Title||Approval Number||Contract Date||Contractor||Contractor Address||Executing Agency||Contract Description||Total Contract Amount (US$)||Contract Amount Financed by ADB (US$)|
|Policy and Advisory||Technical Assistance 9012||25 Sep 2017||INTELLIGENT ENERGY SYSTEMS PTY LTD(AUSTRALIA) in association with Energy Market Consulting Associates()||LEVEL 2, 10-12 CLARKE STREET, CROWS NEST 2065 SYDNEY, NSW , AUSTRALIA||Ministry of Industry||Consulting Services||495,000.00||—|
None currently available.