Public Disclosure Authorized Offshore Wind Development Program OFFSHORE WIND ROADMAP FOR VIETNAM Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized 75983_ESMAP_Tech Report VM Wind_CVR.indd 3 4/5/21 7:20 AM © 2021 April | International Bank for Reconstruction and Development / The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved This work is a product of the World Bank with contributions given by the staff and consultants listed in the Acknowledgments. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. 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All images remain the sole property of their source and may not be used for any purpose without written permission from the source. 75983_ESMAP_Tech Report VM Wind_CVR.indd 4 4/5/21 7:20 AM Offshore Wind Roadmap for Vietnam 75983_ESMAP_Tech Report VM Wind-NEW.indd 1 3/19/21 12:25 PM 75983_ESMAP_Tech Report VM Wind-NEW.indd 2 3/19/21 12:25 PM CONTENTS Abbreviations . xi Company and institute abbreviations . .xiv Acknowledgments . xvi. Executive Summary . xvii About this Roadmap . xvii Key findings . xvii Priority themes . xix. Recommended actions . .xix 1 . Introduction . .1 1 1. Report structure . 1 2 . Two Scenarios for Offshore Wind in Vietnam . 2 2 1. Types of offshore wind projects . 5 3 . Low Growth Scenario . 6 3 1. Development areas . 6 3 .2 Electricity mix . 7 3 .3 Levelized cost of energy and net benefit to consumers . 7 3 .4 Supply chain and economic impact . 8 3 5. Infrastructure . 10 3 6. Environment and social impacts . .10 3 7. Finance and procurement . 11 3 .8 Actions to deliver the low growth scenario . 11 3 .9 SWOT analysis for Vietnam in the low growth scenario . 11 4 . High Growth Scenario . 13 4 1. Development areas . 13 4 .2 Electricity mix . 13 4 .3 Levelized cost of energy and net benefit to consumers . 14 4 .4 Supply chain and economic impact . 15 4 5. Infrastructure . 16 4 6. Environment and social impacts . 17 iii 75983_ESMAP_Tech Report VM Wind-NEW.indd 3 3/19/21 12:25 PM 4 7. Finance and procurement . 17 4 .8 Actions to deliver the high growth scenario . 18 4 .9 SWOT analysis for Vietnam in the low growth scenario . 18 5 . Roadmap for Offshore Wind in Vietnam: Our Recommendations . 19 5 1. Vision and volume targets . 19 5 .2 Leasing, permitting, and power purchase . 20. 5 .3 Project finance . 21 5 .4 Transmission and port infrastructure . 21 5 .5 Supply chain development . 22 5 6. Standards and regulations . 23. Supporting Information . 26 6 . Key Ingredients for a Successful Offshore Wind Industry . 27. 6 1. Stable policies and pipeline visibility . 27. 6 .2 A coherent industrial strategy . 29. 6 .3 Resourced institutions . 30. 6 .4 Competitive environment . .30 6 .5 Supportive and engaged public . 32. 6 6. A commitment to safety . .32 6 7. Using the best locations . .32 7 . Benefits and Challenges of Offshore Wind . 36 7 1. Benefits . .36 7 2. Challenges . 38. 8 . Market Volume in Vietnam . 41 8 1. Story to date . 41 8 .2 A vision for offshore wind to 2050 . 41 8 .3 In Vietnam’s national context . .42 8 .4 Within East and Southeast Asia . 42. 8 5. Globally . .43 8 6. Vietnam offshore wind energy production and cost data . .44 9 . Cost of Energy Reduction . 47 9 1. Purpose . 47 9 2. Method . 47 9 3. Results . .49 9 .4 Key factors for cost reduction . 56. 9 .5 Background: Details of methodology . 56. iv Offshore Wind Roadmap for Vietnam 75983_ESMAP_Tech Report VM Wind-NEW.indd 4 3/19/21 12:25 PM 10 . Supply Chain Analysis . 62 10 1. Purpose . .62 10 2. Method . .62 10 3. Results . 64. 11 . Jobs and Economic Benefit . 78 11 1. Purpose . 78 11 2. Method . 78 11 3. Results . 79 11 .4 Background: Detail of method . .88 12 . Environmental and Social Considerations . 91 12 1. Purpose . 91 12 2. Method . 91 12 3. Results . 93. 13 . Leasing and Permitting . 103 13 1. Purpose . .103 13 2. Method . ..