After long delay, Vietnam may finally back out on nuclear power project

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After years of delaying work on the first nuclear power project over safety concerns, the Vietnamese government now believes it's time to pull the plug.

The National Assembly, Vietnam’s top legislative body, is expected to review the government's proposal to cancel the project in Ninh Thuan Province on Thursday.

Legislators approved the project in late 2009 to build two plants with a combined capacity of 4,000 megawatts, meeting 3-4 percent of the country’s total electricity demand.

The country originally planned to start work on the first plant in 2014 with technical assistance from Russia’s state nuclear firm Rosatom. A Japanese consortium was also picked to develop the second plant.

But following the nuclear disaster in Japan’s Fukushima in 2011, the Vietnamese government ordered relevant agencies to thoroughly review safety measures and last year announced that it would delay work on the first plant until 2020. The Nuclear Atomic Energy Department once said Vietnam lacked experience in nuclear power generation.

The Saigon Times said in a report on Monday that apart from safety concerns, pricing could be another issue.

The Japanese and Russian consultant units recently estimated that the cost has escalated from the original estimation of $10 billion to $27 billion. The plants will have to sell power at around 8.65 cents a kWh, which is almost twice the rate approved in the project license and is not competitive at all.

The state utility Electricity of Vietnam paid around 5 cents a kWh for power last year.

Economists have estimated that work on the first nuclear plant will also cause Vietnam’s public debt to grow.

The government aims to keep Vietnam’s public debt below 65 percent of gross domestic product. It reached more than VND2,600 trillion ($116 billion) as of the end of 2015, equal to 62.2 percent of GDP.

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