Vietnam pushes ahead with coal-fired power plant renovation
SGC Energy, a South Korean company, has signed an agreement to jointly promote a biomass power project for the conversion of a coal-fired power plant in Vietnam with the Vietnamese engineering consulting firm PECC1. SGC Energy is a South Korean renewable energy company, whose main businesses include cogeneration, power generation, transmission and distribution, renewable energy and related investments. SGC Energy is a Korean renewable energy company whose main businesses include cogeneration, power generation, transmission and distribution, renewable energy and related investments.
PECC1 is a power engineering consulting company owned by Vietnam Electricity, which holds a 54% stake. PECC1 is a power engineering consulting company owned by Vietnam Electricity, with a 54% stake in Vietnam Electricity. The company is mainly involved in large-scale power infrastructure projects in Vietnam, Laos and Cambodia. Under the cooperation agreement, SGC will be responsible for the operation and management of the project; PECC1 will be responsible for the feasibility study, as well as project procurement and construction. Vietnam’s domestic coal power installation is about 25G, accounting for 32% of the total installed capacity. Vietnam has set a goal of carbon neutrality by 2050, so it needs to phase out and replace coal-fired power plants.
Vietnam is relatively rich in biomass resources such as wood pellets and rice straw. Vietnam is the world’s second largest exporter of wood pellets after the United States, with an annual export volume of more than 3.5 million tons, and in 2021 the export value reached $400 million. There is a demand for low-carbon transition of a large number of installed coal power, rich biomass resources for coal to biomass power industry provides favorable conditions. This project is an effective attempt to decarbonize and clean up coal-fired power stations for the Vietnamese government.
Well-established support and operational mechanisms in Europe
It can be seen that doing the business of retrofitting biomass power plants to coal-fired power plants is one of the ways out for the carbon neutral transformation of coal power projects, and it can also bring a win-win situation for developers and engineers. For developers, they do not have to dismantle the power plant, and make full use of the original license, original facilities and local resources to realize green and low-carbon transformation, and bear the responsibility of carbon neutrality at a lower cost. For coal-fired power engineers and new energy engineers, this is a very good opportunity for engineering projects. As a matter of fact, the essence of coal power generation to biomass-coal coupled power generation and pure biomass power generation is fuel substitution, and its technology path is more mature.
Europe, such as the United Kingdom, the Netherlands and Denmark have formed a very mature support and operation mechanism. The UK is currently the only country that has realized the transition from biomass-coupled power generation from large coal-fired power plants to 100% pure burning of biomass fuel in large coal-fired power plants, and plans to close all coal-fired power plants in 2025. Asian countries such as China, Japan and South Korea are also making positive attempts and gradually establishing supporting mechanisms.
In 2021, the global installed coal power capacity will be around 2,100 GW. From the perspective of achieving global carbon neutrality, a considerable portion of these installations will require capacity substitution or low-carbon transformation and retrofitting. Therefore, while focusing on new energy projects such as wind power and photovoltaic, energy engineers and developers around the world can pay due attention to the carbon neutral transformation of coal power, including the potential direction of converting coal power to gas power, coal power to biomass power, coal power to garbage power, or installing additional CCUS facilities, etc. This may provide a good opportunity for the dwindling coal power industry to realize carbon neutrality. This may bring new market opportunities for the declining international thermal power engineering.
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