NYSE-listed GE Energy Financial Services, a GE Capital business unit, and Ireland-based Mainstream Renewable Power Ltd. have struck a deal to develop, build and operate large scale wind power plants in Vietnam, which is thirsty for electricity to fuel its economic growth.
Their joint wind projects will have a value of up to $1.5 billion, with GE putting up a portion of the funding and providing technology, The Wall Street Journal reported, citing a Mainstream Renewable executive as saying.
The investment by Mainstream Renewable and GE in Vietnam will be funded with a mix of equity and debt. Construction on the projects are expected to begin in 2018 and will add one gigawatts (GW) to Vietnam’s overall power capacity.
The agreement is aimed to compliment the 1GW initiative that GE and the Vietnamese Ministry of Industry and Trade signed in May 2016 during President Obama
’s Vietnam visit to accelerate large-scale Vietnamese wind project buildout.
“Vietnam is going to be a huge importer of energy” as the economy grows, said Mainstream Renewable Chief Operating Officer Andy Kinsella. “There’s huge demand for power and they can balance the equation with renewables.”
“We look forward to expanding our operations in Asia and working with GE to bring much needed power to Vietnam,” Kinsella added.
Vietnam is pushing to increase the share of wind and solar to power their economic growth as the cost of generating renewable energy declines, making it competitive with coal and liquefied natural gas.
Vietnam’s government has set a target of increasing its power output to 330 - 362 billion kilowatt hours (kWh) in 2020 from 194 - 210 billion kWh in 2015.
Vietnam’s overall power capacity was at 34GW at the end of 2014, according to government figures. The foreign aid arm of the U.S. government estimates that installed wind power capacity in Vietnam is currently 135 megawatts.