Vietnam’s renewable energy market is one of Southeast Asia’s most dynamic, driven by rapid economic growth and strong government commitments. Renewables already account for about 27% of Vietnam’s installed power capacity. Recent policies under Power Development Plan VIII (PDP8) aim to boost this further – targeting 28-36% of electricity generation from renewables by 2030. It highlights the robust opportunities for foreign investors penetrating Vietnam renewable energy market.

Market Overview of Vietnam’s Renewable Energy Market

Vietnam has experienced a renewable energy boom in the past decade, transforming from a minor player to a regional leader. By the end of 2023, Vietnam had the largest solar capacity in Southeast Asia (18.6 GW)[1]. Renewables (mainly solar and wind) now make up roughly 27% of the country’s installed power capacity[2], a remarkable increase fueled by supportive policies and Vietnam’s favorable geography (abundant sun and a 3,000 km coastline with strong winds).

Installed power capacity in Vietnam

来源：B&Company编译

The government’s orientation is firmly pro-renewables, motivated by energy security and climate commitments. Under the newly approved PDP8 (2023), Vietnam targets renewable sources to supply 28-36% of electricity by 2030, rising to 74-75% by 2050[3] – a drastic shift from its past reliance on coal and hydropower. Accordingly, Vietnam aims to maximize electricity generation from renewable sources, particularly solar and wind.

Power source structure in Vietnam towards 2030 and 2050

Source: Decision 768/QĐ-TTg

Vietnam initially used generous feed in tariffs (FiTs) from 2019 to 2021 to jumpstart solar and wind. Wind capacity rose from 53 MW in 2013 to about 5,888 MW in 2023. Grid bottlenecks then caused about 1.3 billion kWh of solar curtailment in 2022. Policy now pivots to sustainable growth through grid upgrades, a 2024 direct power purchase agreement for sales to large users, and promotion of storage, grid digitalization, and rooftop solar with a goal of 50 percent of buildings by 2030. The regime is moving from fixed FiTs to competitive auctions, while incentives such as tax holidays and import duty exemptions remain to attract foreign capital and expertise.

Main Players in Vietnam’s Renewable Energy Market

Historically, foreign investors have been the primary drivers of Vietnam’s renewable rollout. Companies from Thailand, Singapore, Japan, and elsewhere brought in capital and technology to build early solar farms and wind parks. However, it also raised questions about domestic companies’ role in large projects. Now the trend is shifting as Vietnamese powerhouses step up. Several local conglomerates (Vingroup, Trungnam, TTC, BIM, etc.) are aggressively expanding in clean energy.

Sources: B&Company compilation

Another insight is the breadth of the market – spanning solar PV (both utility-scale and rooftop), onshore wind, and the frontier of offshore wind. Different players specialize in different segments. For instance, some companies (like B.Grimm or ACEN) focus on solar and onshore wind farms, whereas Orsted and CIP (Denmark) target offshore wind opportunities. The main utility EVN underpins the entire sector, as all projects ultimately connect to EVN’s grid and sell power to it under long-term PPAs. Any investor must work within the EVN single-buyer model and its evolving regulations.

Opportunities and Challenges in Vietnam’s Renewable Energy Market

Entering Vietnam’s renewable energy market offers tremendous promise but also comes with pitfalls to navigate. Foreign investors should weigh the following opportunities and challenges to approach the market:

Key Opportunities

Key Challenges

Implication for Market Entry in Vietnam’s Renewable Energy Market

Vietnam’s renewable energy market presents a compelling opportunity for foreign investors to participate in one of Asia’s fastest energy transitions. Success will depend on understanding the local market intricacies: aligning with government plans, collaborating with local stakeholders, and mitigating infrastructure and regulatory risks.

– Priority sectors: include wind power, solar power, commercial and industrial rooftop solar, battery energy storage, grid digitalization. The strong regional opportunities are the south-central corridor such as Binh Thuan, Ninh Thuan, and Ba Ria–Vung Tau for wind and solar; the Mekong Delta coast such as Soc Trang, Tra Vinh, Ben Tre, Bac Lieu for nearshore and offshore wind; the southeast solar belt of Tay Ninh, Binh Phuoc, Long An, and An Giang for large solar paired with storage; the northern industrial cluster of Bac Ninh, Bac Giang, Hai Phong, Hai Duong, Thai Nguyen, and Quang Ninh for scalable rooftop portfolios.

– Partner with Credible Local Firms: Form joint ventures or partnerships with established Vietnamese companies can assist in navigating regulatory processes, land acquisition, and community relations, while also meeting government expectations for local participation. Successful market entrants often emulate this approach of “localization” – blending foreign capital and tech with domestic stakeholder engagement.

– Focus on Grid-friendly Solutions: Given grid constraints, investors who incorporate solutions (energy storage, grid upgrades, or hybrid projects combining solar, wind, and storage) will have an edge in project approval and performance. Engaging with EVN and authorities on grid integration plans – or investing in dedicated transmission for your project – can mitigate curtailment risk. Vietnam is encouraging projects with batteries or those near consumption centers[7], so tailoring proposals accordingly improves success likelihood.

– Long-Term Commitment and Flexibility: Building relationships with regulators (e.g. Ministry of Industry and Trade, ERAV) and staying adaptable to policy changes is crucial. Patience may be needed during policy transitions (such as tariff adjustments or lengthy approval queues).

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