Australia and Vietnam develop competitive electricity markets

The Electricity Regulatory Authority of Vietnam (ERAV) and the Australian Embassy in Vietnam on April 17 signed a Memorandum of Understanding (MoU) on collaboration to facilitate the development of a competitive electricity market. 

Australian Ambassador Andrew Goledzinowski and Tran Viet Hoa, Director of Electricity Regulatory Authority of Vietnam (ERAV), are joined by Vice Minister of Industry and Trade, Mr Nguyen Sinh Nhat Tan and Assistant Minister for Climate Change and Energy, Senator the Hon Jenny McAllister at the signing ceremony.

The MOU is further evidence of the deepening partnership between Vietnam and Australia in the climate and energy sector, especially after the two countries elevated their relationship to a Comprehensive Strategic Partnership (CSP) in March.

Remarkably, a Comprehensive Strategic Partnership with a pillar on climate, energy, and environment is the first of its kind for an Australian CSP.

This MoU commits the Department of Foreign Affairs and Trade (DFAT) and ERAV – the energy regulator under the Ministry of Industry and Trade of Viet Nam (MOIT), to share experiences and develop cooperation activities to facilitate the development of competitive electricity markets in the context of high renewable integration – a shared opportunity for the two countries.

The MOU builds on existing activities developed under the Partnerships for Infrastructure (P4I) and other bilateral and regional programs, to support the development of the competitive electricity retail market. It also reviews and offers recommendations for practical ways to regulate the transmission and distribution network segment under a competitive retail market, integrates more Variable Renewable Energy (VRE) sources into the power system and market, and implements Demand Response Programs, capacity building, training, and other activities.

The signing ceremony was witnessed by Senator the Hon Jenny McAllister, Assistant Minister for Climate Change & Energy, and MOIT’s Vice Minister Nguyen Sinh Nhat Tan.

“Australia has the same challenges and aspirations to ensure sustainable, secure, and fair electricity services and the foundation for prosperity and economic growth,” said Australian Ambassador to Vietnam Andrew Goledzinowski. “This partnership provides an important opportunity to share knowledge and explore solutions for the Vietnamese power sector.”

Assistant Minister McAllister said Australia highly values the relationship with Vietnam. “By strengthening climate, environment, and energy cooperation we can realize the opportunities of a clean energy future. I am pleased to see the growing relationship between the Electricity Regulatory Authority of Vietnam (ERAV) and the Australian Embassy that will strengthen bilateral engagement on climate and energy.”

Vice Minister of Industry and Trade, Nguyen Sinh Nhat Tan, emphasized the importance of developing competitive electricity markets to support Vietnam’s ambitious decarbonization agenda through the National Power Development Plan VIII (PDP8).

“Creating competitive electricity markets alongside the appropriate regulatory frameworks can attract the private investment needed to achieve Vietnam’s renewable energy targets,” he said.

Vietnam’s electricity industry has advanced significantly among developing nations in terms of transmission and distribution loss management and power supply reliability.

Vietnam intends to create an electricity market that is competitive and requires the sale of electricity from numerous suppliers.