The Vietnamese government has decided to stop a project to build two nuclear power plants with Russian and Japanese assistance in the southern province of Ninh Thuan
due to their infeasibility and the country’s financial hardship, according to officials.
Legislators are expected to discuss the government’s proposal to put off the projects on November 10 and give final approval on November 22.
The parliament in late 2009 granted a green light to the project to build two plants with a combined capacity of 4,000 megawatts at a cost of a more than $10 billion, meeting 3-4% of the country’s total electricity demand.
According to the initial plan, Russia's Rosatom State Nuclear Energy Corporation is the partner for the country's first nuclear power plant, Ninh Thuan 1. The plant will be built with Russian technologies and financed with a preferential loan provided by Moscow.
The plan also envisaged that Japan was to begin the construction of the second nuclear power plant.
The first plant was originally slated to become operational in 2020 but was subsequently delayed until 2028, followed by 2029 for the second plant.
A prospective view of the Ninh Thuan 1 nuclear power plant. Photo: dienhatnhan.com.vn
Duong Quang Thanh, chairman of state-run utility Electricity of Vietnam (EVN
), told local press on November 9 that the nuclear power plants will not be as competitive as other sources of energy.
Further, new calculations showed that Vietnam’s energy demand would grow 11% in the 2016-2020 period and 7-8% in the following decade, much lower than a 20% expansion projected at the moment the project was submitted for parliamentary approval.
Funding and pricing will be other matters of concern, according to the Saigon Times newspaper.
Japanese and Russian consultancy units recently estimated that the cost would soar to $27 billion, nearly triple the initial cost. In addition, the plants will have to sell power at 8.65 U.S. cents per kWh, compared to 4.93 U.S. cents/kWh estimated in 2009.
What’s more, the work of the first plant will cause public debt to swell by nearly 4 percentage points as per GDP, or 0.5 percentage point of GDP annually. Meanwhile, the parliament has approved a plan to curb public debt, which reached 62.2% of GDP in 2015, at 65% of GDP in 2016-2020.