Vinh Tan 1 gearing up for operation

14:00 | 23/08/2018
The $1.75 billion Vinh Tan 1 thermal power plant, the largest Chinese-invested project in Vietnam, will come into commercial operation ahead of schedule after concerns of potential power shortages in the southern provinces. Phan Ngoc Cam Thanh, deputy director of Vinh Tan 1 Power Co., Ltd. told VIR’s Thuy Thu about his preparations and ambitions for the future.
vinh tan 1 gearing up for operation

Negotiating build-operate-transfer (BOT) projects is often time-consuming. What’s your advice for investors wishing to operate BOT power projects in Vietnam?

BOT power projects are often quite complex in both technical and commercial aspects. While a slew of BOT power contracts have been signed, only two BOT coal-fired thermal power plant projects have been successfully expedited to begin commercial operation: Mong Duong 2 in the northern province of Quang Ninh and Vinh Tan 1 in the central province of Binh Thuan. Based on my experience, I would like to share some small advice for prospective BOT power project investors in Vietnam. First, investors need a thorough understanding of Vietnam’s investment climate–not only the regulatory system, social, and economic situation, but also the power sector’s specific technical conditions such as load demands and grid systems–to be able to create a suitable approach and make a suitable proposal to the Vietnamese government.

Second, investors need to adopt cutting-edge technology which matches global trends and is environmentally friendly to enhance the project’s feasibility.

Finally, to secure success, investors need to team up with experienced and capable local partners, carefully prepare all the project documents, and effectively leverage the local manpower potential.

When will the Vinh Tan 1 thermal power plant start generating profits?

Operating under the BOT format, the project boasts around $1.75 billion in total investment capital, 80 per cent of which is sourced from a consortium of several international banks. If the project runs smoothly without any hitches, Vinh Tan 1 Power Co., Ltd. will be able to pay off all debts and start generating profits 18 years after the plant starts commercial operation.

Could you elaborate on how the plant’s technology meets environmental standards?

The project’s investment proposal was approved by the Vietnamese government in 2006 and its BOT contract was signed in 2013. To keep up with contemporary technology trends and mitigate harm to the environment, the company had proposed and sought the Ministry of Industry and Trade’s approval to shift to using advanced supercritical boiler technology, which helps boost the plant’s power generation efficiency while reducing input fuel volume as well as annual ash and cinder emission volumes.

As this is the first project in Vietnam to use supercritical boiler technology to burn anthracite coal in water, the project’s success could lay the foundation for effective, economical, and environmentally friendly coal usage.

In addition, the high performance ratios of Vinh Tan 1 plant’s electrostatic precipitator system (99.5 per cent), seawater flue gas desulfurisation system (more than 90 per cent), and selective catalytic reduction system (over 68 per cent) ensure the plant always meets required environmental standards.

During the plant’s operation, the environmental surveillance system will work around the clock and transmit surveillance data related to exhaust gas, cooling water, and other factors to the Binh Thuan Department of Natural Resources and Environment for supervision.

Does Vinh Tan 1 Power Co., Ltd. have plans to further engage in the Vietnamese power sector?

China Southern Grid Co., Ltd. (CSG) is one of China’s two national power groups, managing the grid system in five southern provinces, with power generation capacity of approximately 300 gigawatt-hours annually. CSG has been co-operating with state-run Electricity of Vietnam (EVN) and the Vietnamese government on development of the Vietnamese power sector since the late 1990s. As of now, CSG is not only successfully working on the Vinh Tan 1 BOT thermal power plant, but is also engaged in implementing multiple 220 kilovolt (kV) and 500kV power transmission projects in northern Vietnam.

To further contribute to Vietnam’s development, CSG is continuing its co-operation with EVN in the study and development of Vietnam’s power transmission and distribution system as well as power plants to boost the power supply to southern Vietnam after 2020.

We are also seeking opportunities to invest in renewable energy projects in the country such as wind power, waste-to-power, and solar power, fields in which CSG has had an impressive track record in operation and management so far.

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