Wednesday, September 26, 2007

Asian Development Bank lends Vietnam $1 billion for power plant

ADB Lends Vietnam Nearly $1 bln For Power Plant

The Asian Development Bank has agreed to lend Vietnam $931 million to build a 1,000-megawatt (MW) coal-fired power plant to help meet soaring energy demand, a bank official said Friday.

The 25-year loan will help finance 84 percent of the Mong Duong power plant in the northern coal hub province of Quang Ninh. The remainder will be invested by dominant utility Electricity of Vietnam (EVN), said ADB project officer Anthony Jude in Manila.

Construction of the plant will begin next year with completion scheduled for 2012, he said.

A second plant with similar capacity will be built in the second phase of the project in Mong Duong by private investors, ultimately adding 2,200 megawatts of generating capacity to Vietnam's electricity system, the bank said.

Energy demand is expected to grow about 17-18 percent annually in Vietnam in the next several years as the economy expands at more than 8 percent. Energy experts say Vietnam needs to diversify its energy resources to support its ambitious development plans.

EVN has said it would need to invest an average $3 billion to $4 billion annually in new electricity generation capacity to meet demand.

Around 60 percent of Vietnam's 12,000 MW capacity comes from coal, gas fire and fuel oil while hydro provides about 40 percent. The country plans to start building a nuclear power plant in 2015.

ADB said a prerequisite of its support for the Mong Duong project was a detailed environmental impact study and the plant would use technology aimed at significantly reducing emissions.