Renewable Energy 2026 Comparisons

Vietnam is accelerating its energy transition under the Revised National Power Development Plan for 2021–30, with a vision to 2050 (Revised Power Development Plan VIII). The transition is aimed at gradually reducing long-term dependence on fossil fuels, increasing the share of renewable energy in the power mix and supporting Vietnam’s commitment to achieve net-zero emissions by 2050.

Coal-fired power continues to play an important role in energy security, but Vietnam is restricting the development of new coal-fired power sources and aims to reduce the role of coal after 2030 through fuel conversion or decommissioning where technical and economic conditions allow. At the same time, renewable and new energy sources, including hydropower, onshore, nearshore and offshore wind, solar power, biomass, waste-to-energy, green hydrogen and green ammonia, are being prioritised.

At the end of 2025, renewable energy sources excluding hydropower, mainly wind, solar and biomass, accounted for approximately 27.9% of Vietnam’s installed power capacity, while hydropower accounted for approximately 28.1%. In terms of generation, non-hydro renewables accounted for approximately 12.9% of electricity output in the first half of 2026. Under the Revised Power Development Plan VIII, renewable energy excluding hydropower is targeted to account for approximately 28–36% of total electricity generation by 2030 and 74–75% by 2050.

The transition is closely linked to the development of smart grids and transmission infrastructure, which are needed to integrate more variable renewable energy into the power system. In parallel, Vietnam continues to use domestic fossil energy resources and prioritise gas-fired power and liquefied natural gas (LNG) as transitional sources during the period of gradually reducing dependence on coal.

At present, the most important renewable energy technologies in Vietnam are hydropower, solar power and wind power. Hydropower remains a major part of the power system, while wind power and solar power continue to be prioritised for development under the Revised Power Development Plan VIII and Resolution No 70-NQ/TW. In addition, Vietnam also encourages the development of biomass, waste-to-energy and pumped-storage hydropower in order to diversify energy supply and enhance the flexibility of the power system.

With respect to emerging technologies such as hydrogen, green ammonia, geothermal energy, wave energy and tidal energy, Vietnam is currently in the process of conducting research, assessing their potential and implementing pilot projects before proceeding with commercial-scale deployment.

Compared to 12 months ago, Vietnam’s renewable energy market has become more focused on implementation rather than rapid capacity expansion. The key trends have been the continued development of solar power, increasing interest in offshore wind and battery energy storage systems (BESS) and the gradual implementation of mechanisms such as direct power purchase agreements (DPPAs) and rooftop solar self-consumption. A notable example is the first DPPA through the national grid, involving TTC Duc Hue 2 Solar Power Plant and Samsung Electronics Vietnam Thai Nguyen. This shows that corporate renewable power procurement is beginning to move from policy design to practical application.

Offshore wind has also remained an important area of interest, as shown by the assignment of sea areas to Petrovietnam and Vietnam Electricity (EVN) for offshore wind site investigations and by continued interest from international developers such as PNE in Binh Dinh. However, project development remains subject to practical challenges, particularly electricity pricing, bankable power purchase agreements (PPAs), grid capacity, curtailment risk and capital mobilisation. LNG-to-power also continues to be developed as a transitional source to support energy security while Vietnam gradually increases the share of renewables in the power mix.

From an international perspective, Vietnam continues to implement its commitments under the Just Energy Transition Partnership (JETP) and to co-operate with foreign investors, lenders and development partners in offshore wind, grid modernisation and green finance. No major public court judgment appears to have reshaped the renewable energy market in the last 12 months, but legacy issues from earlier solar and wind projects remain relevant to investor confidence.

The energy market in Vietnam is primarily governed by the Law on Electricity No 61/2024/QH15 and its implementing regulations, together with the Law on Investment No 143/2025/QH15, the Land Law No 31/2024/QH15, the Law on Environmental Protection No 72/2020/QH14, the Petroleum Law and relevant regulations on construction, bidding and investor selection. Although Vietnam does not have a standalone renewable energy law, renewable energy is regulated under an increasingly detailed sector-specific framework within the electricity regime. In particular, Decree No 58/2025/ND-CP provides detailed rules on the development of renewable energy power and new energy power, including offshore wind power, self-produced and self-consumed electricity, electricity storage systems and new energy sources, while Decree No 57/2025/ND-CP, as recently amended, regulates the DPPA mechanism between renewable energy generators and large electricity consumers.

In addition to legislation, the Revised Power Development Plan VIII remains the key planning instrument for the power sector, prioritising renewable and new energy sources such as offshore wind, solar power, biomass, green hydrogen and green ammonia in support of Vietnam’s net-zero emissions target by 2050. Looking ahead, the continued implementation of the new Electricity Law framework and the draft amended Petroleum Law should be monitored, as they may further clarify the regulatory basis for offshore energy, the use of existing oil and gas infrastructure, hydrogen, green ammonia and carbon capture, utilisation and storage (CCUS) projects.

The principal regulatory authorities in the energy sector in Vietnam include the government, the Ministry of Industry and Trade (MOIT) and the Provincial People’s Committees. The government exercises unified state management over the electricity sector nationwide. The MOIT is the main authority responsible for state management of the electricity and renewable energy sectors, including:

• formulating and implementing policies;
• managing power development planning;
• issuing, amending and revoking electricity operation licences within its competence; and
• conducting inspections, examinations and enforcement actions in accordance with law.

At the local level, Provincial People’s Committees exercise state management over electricity activities within their respective localities. They play an important role in supervising the implementation of energy projects and, together with relevant local departments, may be involved in investment, land, construction, environmental and other local approvals. They also have authority to conduct inspections and examinations, and to impose administrative sanctions within the scope of their statutory powers.

Regulated activities in the renewable energy sector include:

• the development, construction and operation of renewable power projects;
• power generation, grid connection and power system operation; the sale and purchase of electricity, including under the DPPA mechanism; and
• the adjustment or supplementation of relevant power development plans where required by law.

In addition to the general legal framework on electricity, investment, land, construction and environmental protection, certain renewable energy activities are subject to sector-specific rules. Offshore wind power is subject to a dedicated regulatory framework covering site surveys, approval of investment policy, sea-area use and investor selection. Self-produced and self-consumed rooftop solar power is governed by separate rules on installation, grid connection and the treatment of surplus electricity. In particular, rooftop solar systems with an installed capacity of 1,000 kW or more that sell surplus electricity to the national power system must comply with power planning procedures and obtain an electricity operation licence.

The sale and purchase of electricity from renewable energy projects may also be conducted under the DPPA mechanism, provided that the statutory conditions are satisfied. Non-compliance with applicable electricity regulations may result in administrative penalties, remedial measures and, in serious cases, suspension or revocation of relevant licences or approvals.

Vietnam does not prohibit the ownership or transfer of renewable energy projects. However, ownership rights and transfers of control must comply with applicable legal conditions and approval procedures. Investors do not own land or sea areas in Vietnam, but may be allocated or leased land, or assigned the right to use sea areas by the state for a definite term in accordance with law.

A transfer of a renewable energy project, or a transfer of control over the project company, may be subject to approval or registration procedures under the laws on investment, enterprises, electricity, land and other relevant regulations. The transaction may also require amendments to the relevant project approvals, electricity operation licences, land or sea-area use documents, grid connection arrangements and PPAs. For offshore wind projects, and projects located in areas subject to national defence and security considerations, investors may also be required to satisfy sector-specific conditions, including requirements pertaining to national defence and security appraisal, investor qualifications and foreign ownership limits, where applicable.

Vietnam generally does not impose restrictions on foreign access to or investment in the renewable energy market, and there is no general foreign ownership cap applicable to renewable power projects. Foreign investors may invest in renewable energy projects through the establishment of project companies, acquisition of equity interests, or participation in project development and investor selection procedures, subject to the investment and electricity laws. However, market access remains subject to project-specific requirements.

Certain projects, particularly offshore wind projects and projects located in areas relevant to national defence and security, may be subject to investor selection procedures, investment approval requirements, sea-area use procedures, national defence and security appraisal, investor qualification requirements and other conditions under the applicable energy legislation. Accordingly, foreign investors can access the renewable energy market, but project structuring should be reviewed carefully from the outset, especially for offshore wind, large-scale projects and transactions involving a change of control.

Vietnam’s electricity market is organised in accordance with the roadmap for the development of a competitive electricity market. The power generation segment has gradually developed into a competitive generation market with the participation of state-owned enterprises, private enterprises and foreign investors, while electricity transmission remains a state monopoly.

Renewable electricity generation is primarily carried out through hydropower, solar power, onshore and nearshore wind power, biomass and waste-to-energy projects, with offshore wind, BESS and new energy sources remaining at an earlier stage of development. The principal participants in renewable electricity generation include renewable power generators, EVN and its relevant power purchasing entities, the National Power Transmission Corporation (EVNNPT), the National Power System and Market Operator Company Limited (NSMO), large electricity consumers under the DPPA mechanism, engineering, procurement and construction (EPC) contractors, equipment suppliers, operation and maintenance (O&M) contractors, lenders and relevant state authorities.

The principal assets comprise renewable power plants, grid connection infrastructure, substations, BESS, electricity transmission and distribution networks, and the relevant project approvals, licences and power purchase arrangements. The operation of renewable electricity generation is primarily governed by the Law on Electricity 2024 and its implementing regulations, including regulations on renewable and new energy power, electricity operation licences, grid connection and power purchase mechanisms.

Vietnam has not yet established a renewable gas industry on a large commercial scale. Production activities are primarily concentrated on biological gas derived from livestock waste, agricultural by-products and organic waste, for on-site consumption or small-scale power generation, while green gas (green gas/biomethane) has not yet been produced or distributed on a commercial scale.

The principal market participants include livestock enterprises, waste treatment enterprises, agricultural establishments and a number of investors developing biomass energy projects. The principal assets comprise anaerobic digestion systems (biogas digesters), gas collection and treatment systems, biogas-fired power generation equipment and ancillary facilities.

Vietnam has not yet established a dedicated legal framework governing renewable gas production; these activities are primarily regulated by the laws on investment, environmental protection and electricity, together with policies promoting the development of renewable energy.

Due to Vietnam’s hot and humid tropical climate, demand for space heating is limited, and Vietnam has not developed district heating networks comparable to those in colder jurisdictions. Renewable heat is therefore not a standalone market on a large commercial scale, but mainly exists in specific on-site applications, including heat from combined heat and power activities in the sugarcane and biomass sectors, biogas boilers, solar thermal systems and waste heat recovery.

Vietnam has not established a dedicated legal framework for renewable heat. Depending on the project structure and end use, these activities may be regulated under the laws on investment, construction, environmental protection, fire prevention and safety, economical and efficient use of energy and, where heat is used to generate electricity, the electricity regulatory framework.

Geothermal energy is recognised as a renewable energy source under the electricity framework, and the Revised Power Development Plan VIII includes geothermal power and other new energy sources in the power source development plan. However, geothermal energy and other renewable heat applications remain at an early stage and are not yet significant commercial market segments in Vietnam.

Hydrogen, green ammonia, biofuels and biomass are at different stages of development in Vietnam. Green hydrogen and green ammonia are increasingly recognised as strategic solutions for the energy transition, particularly for power generation, industrial decarbonisation, transport, fertiliser production and potential export opportunities.

Under Vietnam’s hydrogen energy development strategy, Vietnam aims to reach hydrogen production capacity from renewable energy and other processes with carbon capture of approximately 100,000 to 500,000 tonnes per year by 2030 and 10 to 20 million tonnes per year by 2050. However, the commercial market for green hydrogen and green ammonia remains at an early stage, and further regulations on technical standards, production, storage, transportation, safety and offtake arrangements will be needed.

Under the 2024 Electricity Law framework, green hydrogen and green ammonia are recognised as part of the new energy power segment, and Decree No 58/2025/ND-CP provides incentive and support mechanisms for certain new energy power projects using 100% green hydrogen, 100% green ammonia or a mixture of the two, subject to statutory conditions.

Biofuels are more developed in practical market use, particularly through ethanol-blended gasoline. Vietnam implemented E5 biofuel gasoline and has applied E10 gasoline nationwide from 1 June 2026, with ethanol supply linked to domestic crops such as cassava, maize and sugarcane. Biomass power is also relevant, particularly in the sugarcane sector, where bagasse-fired biomass power accounts for the majority of Vietnam’s biomass power capacity, although its further development remains affected by pricing and commercial viability issues.

The principal assets in this segment may include renewable power plants, electrolysers, water treatment systems, hydrogen or ammonia production facilities, storage tanks, pipelines, biomass processing facilities, biofuel blending and distribution facilities and associated power generation facilities. The main participants include renewable power developers, industrial users, fuel producers, biomass suppliers, technology suppliers, logistics providers, offtakers, lenders and relevant state authorities. These activities are generally regulated under the laws on investment, electricity, environmental protection, product quality, technical standards, transport, fire prevention and safety, depending on the project structure and end use.

Local and domestic renewable energy production in Vietnam is mainly seen in self-produced and self-consumed rooftop solar systems, particularly those installed by households, commercial buildings, factories and industrial facilities. This segment is currently governed principally by Decree No 58/2025/ND-CP, as amended by Decree No 243/2026/ND-CP, which together form the current framework for renewable and new energy development.

The regulatory regime distinguishes between different types of rooftop solar systems and generally provides simpler procedures for households and small-scale self-consumption systems. Eligible self-produced and self-consumed rooftop solar systems may sell surplus electricity to the national power system, with the volume generally capped at 50% of the electricity generated at the inverter output.

The purchase price is based on the average electricity market price of the preceding year, and the sale of surplus electricity is implemented through contracts with the relevant electricity purchaser. The principal assets include rooftop solar panels, inverters, metering systems, grid connection facilities, BESS and on-site electrical infrastructure. The principal participants include households, building owners, industrial and commercial users, rooftop solar developers, EPC contractors, O&M contractors, EVN or other relevant electricity purchasers, and relevant state authorities.

The transportation and operation of renewable electricity in Vietnam are closely linked to the national transmission and distribution grid. Under the current power system structure, electricity transmission at 220 kV and above is mainly undertaken by the EVNNPT, while electricity distribution is carried out regionally by the five power corporations under EVN. The Electricity Law 2024 also allows non-state economic sectors to invest in the construction of transmission grid assets, subject to implementing regulations on the relevant pricing methodology and mechanisms.

From 1 August 2024, the former National Load Dispatch Centre (A0) was separated from EVN and reorganised as the NSMO under the MOIT. This separation is an important step in electricity market reform, although its practical co-ordination with EVN and other market participants will need to continue developing in practice.

Electricity storage, particularly BESS, is becoming increasingly important as Vietnam increases the share of solar and wind power in the electricity mix. Although the BESS market remains at an early stage, the Revised Power Development Plan VIII identifies storage batteries as part of the national power development orientation, with expected capacity of approximately 10,000 to 16,300 MW by 2030 and approximately 96,000 MW by 2050.

Decree No 58/2025/ND-CP also provides support mechanisms by giving dispatch priority during peak hours to renewable energy projects equipped with electricity storage systems. In practice, storage projects will need to address grid connection, dispatch, revenue model, land use, fire safety, technical standards and allocation of operational risks. A recent example is EVN’s deployment of five pilot BESS systems in the Hanoi area, which indicates the early practical testing of storage solutions in Vietnam.

Grid congestion remains a key practical issue for renewable energy projects in Vietnam, particularly in areas where solar and wind capacity developed faster than transmission infrastructure. In practice, congestion is addressed through power development planning, grid expansion, technical grid connection requirements, dispatch instructions and, increasingly, the development of BESS. Renewable power plants may be required to reduce output under dispatch instructions from the NSMO to ensure system safety and stability. This is effectively a form of mandatory curtailment, while Vietnam does not yet have a developed voluntary curtailment mechanism or a standardised market-based regime for compensating curtailed output.

Flexibility and demand-side management are developing but remain at an early stage. The Electricity Law 2024 introduces measures relating to electricity demand management and a two-component electricity pricing mechanism, while BESS and shorter electricity market trading cycles are expected to support greater system flexibility. At present, standard contracts and incentives for flexibility services are not yet fully developed.

For off-grid or behind-the-meter solutions, Vietnam has experience with renewable electricity supply for islands, remote and isolated areas. From a commercial perspective, self-produced and self-consumed rooftop solar systems and direct power purchase arrangements through a dedicated connection line under Decree No 57/2025/ND-CP provide practical models for supplying renewable electricity to end users without relying entirely on the national grid.

Vietnam does not yet have a specific legal framework for injecting renewable gas into the public gas grid, nor is there any mandatory obligation to blend renewable gas with natural gas. Existing gas infrastructure, including infrastructure operated by PV GAS, is primarily used for natural gas and LNG, and there is currently no dedicated access or injection regime for biogas, biomethane or other green gas.

Biogas in Vietnam is mainly produced at household farms, commercial farms and landfill sites from livestock waste, agricultural residues and organic waste. It is typically used on-site or near the source for cooking, drying, heating or small-scale power generation, rather than being injected into a shared gas transmission or distribution network. The main participants include livestock farms, agricultural producers, landfill operators, waste treatment companies, industrial users and technology suppliers, while the main assets include biogas digesters, gas collection and treatment systems, storage tanks, low-pressure pipelines and biogas-fired generation equipment.

If biogas or biomethane is further promoted in the context of Vietnam’s net-zero target and circular agriculture policy, the absence of a clear grid-injection, gas quality, safety, metering and commercial settlement framework will be an important regulatory gap to address.

As noted in 3.3 Heat, Vietnam’s hot and humid tropical climate means that demand for space heating is very limited. As a result, no district heating system or dedicated heat distribution infrastructure has developed, and there is no specific legal framework governing the transportation or storage of renewable heat.

In practice, renewable heat is generally used on-site within households, farms, factories or industrial facilities, rather than transported through a heat grid. Relevant applications include biomass or biogas boilers, solar thermal systems, waste heat recovery and heat from combined heat and power activities. This is a key difference between Vietnam and colder jurisdictions where district heating networks form an important part of the energy system.

The transportation and storage of hydrogen in Vietnam remain at an early stage. Decision No 165/QD-TTg sets out the overall objective of developing a hydrogen energy ecosystem covering production, storage, transportation, distribution, domestic use and export, supported by synchronised and modern infrastructure. However, Vietnam does not yet have a commercially operating hydrogen ecosystem or a dedicated technical and commercial framework for hydrogen storage and transportation.

Biofuels are more developed in terms of transportation and distribution, particularly through the nationwide use of E10 biofuel gasoline. This segment can largely rely on the existing petroleum distribution infrastructure, including depots, storage terminals and retail stations, and therefore does not require the same scale of new infrastructure investment as hydrogen. Other renewable fuels, such as biomass, are generally transported through project-specific supply chains for use in biomass power, waste-to-energy or industrial facilities.

The market for the trade and supply of renewable electricity to end users in Vietnam remains partly centralised, although competition and direct supply mechanisms are gradually developing. Vietnam has developed its electricity market in stages, including the competitive generation market and the competitive wholesale electricity market, while the competitive retail electricity market remains under development.

In practice, EVN continues to play a central role in electricity purchase and supply arrangements, and retail electricity prices remain largely regulated by the state, except for specific mechanisms such as direct power purchase arrangements. Recent policy directions and draft reforms indicate a continued objective to move towards a more competitive and market-based electricity market, including the possibility for eligible customers to choose electricity retailers and negotiate electricity prices in the future.

There are three main routes for purchasing renewable electricity in Vietnam:

• purchasing electricity through the grid via EVN or relevant electricity purchasers;
• direct power purchase arrangements under Decree No 57/2025/ND-CP; and
• self-produced and self-consumed renewable electricity, particularly rooftop solar, under Decree No 58/2025/ND-CP as amended by Decree No 243/2026/ND-CP.

Under the DPPA mechanism, renewable energy generators may sell electricity directly to large electricity users either through a dedicated connection line or through the national grid. The main parties include renewable power generators, EVN and relevant electricity purchasers, large electricity consumers, rooftop solar owners, electricity retailers, NSMO, grid companies and state authorities. The main contracts include PPAs, DPPAs and contracts for the sale of surplus electricity from self-produced and self-consumed rooftop solar systems.

Vietnam has not yet developed a mature market for the trade and supply of gas from renewable sources, such as biogas, biomethane or other green gas, excluding hydrogen, to end users. Biogas is generally produced and consumed on-site or near the source of livestock waste, agricultural residues, organic waste or landfill gas, mainly for cooking, drying, heating or small-scale power generation. Emerging models may involve upgrading biogas into biomethane or bio-compressed natural gas (CNG) and supplying it to industrial customers, but these remain project-specific rather than a developed renewable gas supply market.

There are no standard contracts specifically for the sale and supply of renewable gas to end users in Vietnam. Relevant arrangements are usually structured through bilateral commercial contracts, such as biogas collection agreements, gas processing or upgrading agreements, biomethane or bio-CNG supply agreements, or on-site energy supply arrangements.

The main participants include livestock farms, agricultural producers, landfill operators, waste treatment companies, gas business operators, industrial offtakers, technology suppliers and logistics providers. Depending on the project structure and end use, these activities may be regulated under the laws on investment, environmental protection, waste treatment, gas business, transport, product quality, technical standards, fire prevention and safety, and electricity where the gas is used for power generation.

Vietnam has not yet developed a standalone market for the trade and supply of heat from renewable sources. This is mainly because demand for space heating is limited and district heating networks have not developed in Vietnam. As a result, renewable heat is generally produced and consumed on-site within households, farms, factories or industrial facilities, rather than supplied to end users through a separate heat market.

In practice, relevant applications include biomass or biogas boilers, solar thermal systems, waste heat recovery and heat from combined heat and power activities. Since there is no separate renewable heat market, there are also no standard contracts specifically for the sale and supply of renewable heat. Any supply arrangements are typically structured on a project-specific basis, such as on-site heat supply agreements, steam supply arrangements or energy service contracts. Depending on the structure, these activities may be regulated under the laws on investment, construction, environmental protection, fire prevention and safety, technical standards and economical and efficient use of energy.

The market for the trade and supply of hydrogen in Vietnam remains at an early stage. There is not yet a mature commercial market for supplying hydrogen to domestic end users, and the initial policy orientation is mainly focused on on-site use, industrial applications and potential export. Technical standards and a complete legal framework for hydrogen sale, purchase and offtake arrangements are still under development.

By contrast, biofuels have a clearer commercial structure. Ethanol-blended gasoline is distributed through the existing petroleum trading system, including major traders, distributors and retail agents. E10 gasoline has been commercialised nationwide, while E5 gasoline is expected to continue to be traded until the end of 2030. At present, biofuels are among the renewable energy segments with the clearest market structure in Vietnam.

Vietnam does not yet have a fully developed domestic statutory market for renewable energy certificates or guarantees of origin. In practice, renewable energy certificates are mainly used on a voluntary basis, with I-REC being the most common international certificate system used by corporate buyers to evidence renewable electricity consumption and support ESG or sustainability reporting commitments.

Long-term PPAs with EVN or its relevant power purchasing entities have been customary for utility-scale renewable power projects, particularly under the previous feed-in tariff regime. However, corporate PPAs remain at an early stage. Decree No 57/2025/ND-CP, as amended by Decree No 243/2026/ND-CP, provides the current DPPA mechanism in two forms:

• direct power purchase through a dedicated connection line, where the electricity price is agreed by the parties subject to the applicable price framework; and
• direct power purchase through the national grid, where the renewable generator sells electricity into the electricity market and enters into a forward contract with the large electricity user.

The main features of such arrangements include long-term offtake, negotiated commercial terms, metering and settlement, grid connection requirements and allocation of curtailment, and change-in-law and environmental attribute risks.

Vietnam’s onshore renewable energy market has developed significantly, particularly in solar power, onshore and nearshore wind, rooftop solar and small hydropower. The earlier phase of rapid growth was largely driven by feed-in tariffs, which enabled Vietnam to add substantial renewable power capacity within a short period, as illustrated by projects such as Dau Tieng Solar Power Project and Trung Nam Thuan Nam Solar Power Project.

Trung Nam Thuan Nam is also notable because it was developed together with transmission infrastructure, highlighting that renewable generation can only grow sustainably if supported by adequate grid capacity, while Bac Lieu Wind Power Plant remains an early example of nearshore wind development in Vietnam. The market has now moved into a more selective phase, where grid connection, power evacuation, tariff mechanisms and storage requirements are key factors for project viability.

An onshore renewable energy project typically involves project developers, investors, EPC contractors, equipment suppliers, O&M contractors, lenders, EVN or the relevant power offtaker, system operators and local authorities. In practice, the main challenge is often not a single permit, but the need to align multiple procedures relating to planning, investment approval, land, environment, construction, fire safety, grid connection and electricity operation licensing.

From a contractual perspective, onshore projects commonly involve EPC contracts, equipment supply contracts, O&M contracts, grid connection agreements and PPAs, while investors and lenders are increasingly focused on curtailment risk, grid connection delays, change in law, equipment performance, environmental obligations and transferability of project interests. As a result, new projects need to be structured with bankability in mind from an early stage of development.

Offshore wind is one of the most promising segments of Vietnam’s energy transition, but the market remains at an early stage. Unlike solar and onshore wind, Vietnam does not yet have a substantial track record of large-scale commercial offshore wind projects. The current focus is on completing the legal framework, conducting marine surveys, selecting investors, developing tariff mechanisms, arranging grid connection and allocating risks under PPAs.

Projects and proposals such as the La Gan Offshore Wind Farm and PNE’s proposed offshore wind project in Binh Dinh show that Vietnam continues to attract interest from international developers, but they also illustrate the gap between market potential and actual implementation. For offshore wind, the key issues are not limited to wind resources, but also include survey rights, rights to use sea areas, national defence and security, maritime safety, marine environmental issues, port infrastructure, supply chains, grid connection and financing capacity.

A notable feature is the increasingly visible role of Petrovietnam and other state-owned enterprises in the early development of the market. The existing capabilities of the oil and gas sector in marine surveys, offshore engineering, logistics, port services and complex project management may become an important foundation for offshore wind, consistent with Petrovietnam’s broader repositioning from a traditional oil and gas company into a national industry-energy group.

From a contractual perspective, offshore wind projects are significantly more complex than onshore projects. Project documents may include survey contracts, turbine supply agreements, wind turbine supply agreements (WTSAs), balance of plant (BoP) contracts, foundation contracts, subsea cable contracts, offshore substation contracts, port logistics arrangements, marine warranty arrangements, O&M contracts, grid connection arrangements and PPAs. As Vietnam does not yet have extensive commercial precedent in this sector, investors will need to rely on international market practice while adapting project structures to Vietnamese law and regulatory requirements for sea areas.

Project financing for renewable energy in Vietnam remains promising, but financing conditions have become more cautious than during the FIT period. Lenders now focus more closely on revenue stability, grid connection, curtailment risk, tariff mechanisms, PPA terms, offtaker creditworthiness and enforceability of security.

Issues arising from the FIT period have also made investors and lenders more attentive to policy risk, as disputes relating to COD, acceptance, payment and electricity tariffs show that changes in the interpretation or application of tariff mechanisms can directly affect project cash flow. As a result, new projects should address change in law, PPA termination, termination compensation, lender step-in rights and dispute resolution mechanisms more clearly.

For offshore wind and new energy projects, the financing challenge is even more complex due to the large capital requirement, long development period and higher technical risk. In addition to the PPA and tariff mechanism, lenders will closely review survey rights, rights to use sea areas, technical survey results, contractor capability, port infrastructure, insurance, foreign exchange, foreign loan registration and enforceability of security. Green finance, carbon market mechanisms and innovation support may improve the attractiveness of projects, but they cannot replace a bankable project structure.

Vietnam is moving away from a support model based mainly on FITs towards a more flexible and selective framework. Current support tools include generation price frameworks, the DPPA mechanism, self-generation and self-consumption structures, incentives for electricity storage, and incentives for new energy sources such as green hydrogen and green ammonia. This reflects the need to balance renewable energy development with system costs, grid capacity and power system stability.

The DPPA mechanism is a significant development because it gives large electricity users an additional route to access renewable electricity, as illustrated by the arrangement between TTC Duc Hue 2 Solar Power Plant and Samsung Electronics Vietnam Thai Nguyen. If implemented consistently, the DPPA could become an important channel for expanding renewable electricity supply to industrial users and foreign direct investment (FDI) enterprises.

Rooftop solar for self-generation and self-consumption also has substantial room for growth, particularly in industrial parks, manufacturing facilities, logistics centres and commercial buildings. The ability to sell surplus electricity makes this model more attractive, although investors still need to consider grid connection, metering, electrical safety, fire safety and electricity operation licensing where applicable.

In addition to renewable energy-specific incentives, Vietnam is developing broader support tools relating to technology innovation, energy efficiency, green classification and carbon market participation. These tools may be relevant to hydrogen, CCUS, sustainable aviation fuel (SAF), storage and offshore wind supply-chain projects, but their practical impact will depend on detailed implementation, monitoring and verification standards, and the ability of project companies to satisfy documentation requirements.

Decommissioning requirements for renewable energy facilities have become clearer under Vietnam’s new electricity and renewable energy framework. For investors, decommissioning should not be treated only as an end-of-life issue, but should be considered from the design stage and reflected in the financial model, financing documents, EPC contracts, O&M contracts and project transfer agreements.

For onshore solar and wind projects, practical issues include:

• dismantling equipment;
• handling solar panels, turbine blades, foundations, electrical equipment, industrial oils and battery storage systems; and
• site restoration.

For offshore or nearshore projects, decommissioning is more complex because it may involve turbine foundations, subsea cables, offshore substations, maritime safety, fisheries, marine environmental issues, national defence and security, and rights to use sea areas.

In project M&A transactions, decommissioning and site restoration obligations should also form part of due diligence. Buyers should review equipment life, outstanding environmental obligations, site handback requirements, expected decommissioning costs and whether a decommissioning reserve or guarantee should be required. Although these risks may not immediately affect current cash flow, they can materially affect long-term project value and should therefore be allocated clearly in transaction documents.

Vietnam is expected to continue prioritising renewable energy, but the focus is shifting from rapid capacity growth to more practical issues of project implementation. Following the new Electricity Law framework and recent regulations on renewable and new energy, the DPPA, rooftop solar, offshore wind and electricity storage, investors are now watching how these rules will be applied in practice, particularly in relation to tariff mechanisms, PPA terms, grid connection, curtailment risk, investor selection and licensing procedures.

Another development to watch is the closer role of Petrovietnam and the oil and gas sector in the energy transition. Petrovietnam’s repositioning as a national industry-energy group may support the development of offshore wind, hydrogen, green ammonia, CCUS, biofuels and other decarbonisation solutions, especially where offshore infrastructure, technical capability and project management experience are relevant. The draft amended Petroleum Law is also worth monitoring, as it may further clarify how existing oil and gas infrastructure and expertise can be used for new energy projects.

In the medium term, the most active areas are likely to include rooftop solar for self-consumption, the DPPA for large industrial customers, renewable projects combined with storage, offshore wind at the survey and preparation stage, and new energy projects such as green hydrogen, green ammonia and CCUS. The pace of development will depend largely on grid capacity, pricing mechanisms, bankable PPAs, land and sea-area procedures, project financing and carbon market implementation.