Vietnam is intensifying its coal imports this year, nearly doubling its intake compared to 2023, as revealed by customs data. This surge comes amidst the government’s efforts to reassure foreign investors of stable power provisions, pledging to prevent a recurrence of the power shortages experienced last year.
According to Reuters, with major manufacturing hubs hosting multinational giants such as Samsung Electronics, Foxconn, and Canon, Vietnam’s credibility has been under scrutiny following disruptions caused by inadequate power supply during the previous summer’s prolonged heatwave. Some factories were compelled to halt operations temporarily.
Prime Minister Pham Minh Chinh, in a recent meeting with foreign investors, asserted a commitment to prevent any further electricity shortages, as reported by state media. However, attendees noted that while Chinh’s assurances were comforting, they lacked specificity regarding the strategies to achieve this objective.
Vietnam’s dependency on coal imports has become increasingly critical due to its limited capacity for renewable energy adoption and its resolve to evade future power deficits. Phan Xuan Dung, a Vietnam researcher at the Singapore-based ISEAS think tank, emphasized the necessity of importing more coal under these circumstances.
Customs data indicates a substantial 88% rise in coal imports, predominantly from Australia and Indonesia, as of March 15 compared to the same period last year. Additionally, domestic coal production increased by 3.3% in the first two months of the year, covering approximately half of Vietnam’s demand, according to official estimates.
Last year witnessed a 61% surge in coal imports as coal-fired power plants resumed full production, aligning with increased usage trends observed in Indonesia, Malaysia, and neighboring countries.
Forecasts suggest a further escalation in coal imports in the latter half of the year, particularly driven by heightened activities in steel production and other energy-intensive industries.
Although specific power generation breakdowns for this year are unavailable, coal-fired plants accounted for approximately 60% of total output on Monday, according to Vietnam’s power network operator.
The combination of augmented imports and increased domestic output indicates a robust coal supply exceeding 8 million metric tons per month during the typically quieter January-February period, marking an almost 9% upsurge from the average monthly figures of the past two years, the Reuters reported.