The European giants of renewable energy are starting to abandon the Vietnamese coast. From Equinor to Orsted, these global leaders are redirecting their priorities in the face of challenges and untapped opportunities in the local market. While Vietnam aims to become a key player in green energy in Southeast Asia, obstacles related to electrical infrastructure, regulation, and necessary investments create a complex landscape for the sector.
European giants in renewable energy such as Equinor and Orsted are leaving the Vietnamese market to focus on more promising markets. Despite Hanoi’s efforts to promote renewable energies, no offshore project is yet operational in the country. Additionally, technical issues related to electric grids and economic challenges make the implementation of solar and wind projects difficult. As a result, companies like Enel are also considering withdrawal, leaving Vietnam in a complicated position as it continues to push for a transition to clean energy amidst vulnerability to climate change.
The challenges in the offshore wind market in Vietnam
The Norwegian group Equinor, a global leader in offshore wind, recently announced its withdrawal from the Vietnamese market. Even though Vietnam has significant ambitions for the development of renewable energies, no offshore project is yet operational. Equinor has made the strategic choice to focus on the most promising markets, thus leaving a country where projects struggle to materialize.
Bureaucratic and infrastructure obstacles
Vietnam’s expectations for renewable energy development are high, but implementation faces serious obstacles. Infrastructure issues, notably aging and insufficient electrical grids, considerably hinder initiatives. This situation leads to delays and additional costs for companies, making the market less attractive for European giants in green energy.
Competitive but insufficient electricity
Vietnam offers electricity at about 25% lower prices than other Asian countries, but this is not enough to offset the various challenges faced. The country, while eager to develop its renewable capacity, is unable to keep pace with its regional counterparts. Recurring issues are even prompting some, like Enel, to consider leaving the Vietnamese market, following in the footsteps of Equinor and Orsted.
