PetroVietnam withdraws US loan application for coal-fired power project: NY Times

By Staff reporters   February 12, 2018 | 02:07 am PT
PetroVietnam withdraws US loan application for coal-fired power project: NY Times
An artist's impression of Long Phu coal-fired power plant that is developed by Vietnam's state-run Petro Vietnam in the country's southern province of Soc Trang. Photo courtesy of PetroVietnam
It's unclear whether the move was influenced by international pressure to end funding for coal plants to limit carbon emissions.

Vietnam’s state-owned energy giant PetroVietnam is no longer looking for financial support from the U.S. to build a coal-fired power plant in the south of the country, according to The New York Times.

American state-run Export-Import Bank said last week that PetroVietnam had withdrawn its loan application at the bank.

The bank said that it was not clear why PetroVietnam had taken the move.

PetroVietnam was not immediately available for comment. 

Just last week, an international coalition signed a petition to stop funding for coal-fired power development in Southeast Asia after studies found that a dramatic increase in carbon emissions could kill tens of thousands in the next decade and sabotage global warming targets.

Environmental organizations Greenpeace, Friends of the Earth, Walhi of Indonesia, and Vietnam’s CHANGE and GreenID filed the petition with banking-focused groups Market Forces and BankTrack to ask Singaporean banks to stop financing plants in Vietnam and Indonesia.

The request is based on a Harvard University study that found that coal pollution could cause 19,220 premature deaths in Vietnam every year by 2030. The number in Indonesia has been estimated at 24,400.

The World Bank and other major institutions have also increasingly avoided supporting projects in developing countries that burn coal and other fossil fuels in a bid to protect the environment, and the U.K. branch of  Ex-Im Bank has already denied funding for PetroVietnam's Long Phu 1 project for the same reasons, according to The Times.

Work on Long Phu 1 in Soc Trang Province started in early 2015. The project is scheduled to start commercial operations with its first turbine in October this year, and the second in February next year.

The construction of the plant, which has a designed capacity of 1,200 megawatts and will consume an estimated 3.2 million tons of coal per year to provide around 7.8 billion KWh annually to the national power grid, had fallen 400 days behind schedule as of October last year.

Authorities have asked PetroVietnam and the contractors to get the project back on track.

Even though Vietnam is looking at ways to switch to clean energy, it also plans to increase the amount coal contributes to electrical output. 

By 2030, Vietnam plans to increase the share of renewable energy sources (excluding hydropower) to 10.7 percent of total electricity generated compared to 3.7 percent in 2013. The share of coal, however, is set to increase to 53.2 percent in 2030, compared to 19.8 percent in 2013. 

Vietnam could see 948 percent growth in coal emissions, an almost 20-fold increase, by 2030, if all its coal power plans are carried forward, according to the research, which used the CoalSwarm database, a project run by the Earth Island Institute which tracks coal plants across the globe, in collaboration with Greenpeace and the Sierra Club.

This puts Vietnam among four other countries, China, India, Indonesia and Turkey, that will be home to “nearly three quarters (73 percent) of the global coal-fired capacity that is currently under construction or planned,” according to a study by the Mercator Research Institute on Global Commons and Climate Change in Berlin, as cited by the Washington Post last week.

The study noted that the world has only about 700 billion tons of carbon dioxide to emit if it wants to hold the temperature increase below 2 degrees Celsius this century as set in the Paris Agreement, of which Vietnam is a signatory.

Existing coal plants and other infrastructure are already capable of consuming 500 billion tons on their own, and the new coal plants could consume another 150 billion tons, the research found.

The aim to hold warming at just 1.5 degrees Celsius seems to have no chance, it said.

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