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The Prospective Evolution of the Vietnamese Power Sector: The Vulnerability and Externality Analysis

Hoang Anh Nguyen-Trinh ()

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Abstract: With its rapidly increasing power demand of 16% p.a since 1990s along with its limited supply power capacity, how sustainable is Vietnam's electricity development? What are the major factors explaining its performance relative to other Asian countries? To answer these questions, this paper examines the Vietnamese power system from the 1990s to 2040 by using LEAP simulation. Twelve vulnerability and externality indexes regarding social-economic-environmental dimensions are calculated to assess vulnerability levels of the sector in seven scenarios. External costs of CO2, NOx, SO2 and PM10 are calculated to examine how far the costs could affect on the electricity cost in Vietnam. In sensitivity analysis, the paper assesses the impacts of international coal price's fluctuations on the electricity price and the trade balance of Vietnam. The study confirms that Vietnam's power sector will become more vulnerable to fossil fuels' prices, environmental pollutants and climate change if the sector goes for the current policy pathways. With the efficiency scenarios examined in the study, the sector would be more independent and less vulnerable. To reduce the vulnerabilities, the study suggests that Vietnam should promote energy efficiency and electricity generation from non-fossil fuels and internalize external costs into the power sector. Vietnam needs also get involved in international financial mechanisms for clean development and technology transfer programs to efficiently exploit its renewable energy potentials.

Keywords: energy planning; sustainable development; vulnerability; externality; Vietnam; electric power (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene, nep-env and nep-sea
Date: 2013-01-31
Note: View the original document on HAL open archive server: https://hal-enpc.archives-ouvertes.fr/hal-00869314
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Published in Prof. August Schläpfer. Sustainable Energy: Planning and Policies, Théoneste Uhorakeye, pp.20-36, 2013, ISBN 978-3-8236-1648-1

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