The industrial development of green hydrogen (GH2) is a direction for Vietnam in the energy transition roadmap to reach the target of zero carbon emissions by 2050, but challenges remain, experts said.
According to experts at the workshop on the policy framework for renewable energy development and the potential for green hydrogen in Vietnam, held by GIZ in collaboration with the Electricity and Renewable Energy Authority under the Ministry of Industry and Trade, with the support of the German Federal Ministry of Economic Affairs and Climate Action (BMWK), Vietnam has a large and diverse renewable energy industry, proximity to major importers in the Asia-Pacific region, strong renewable energy potential, and low political risk.
The GH2 produced from the electrolysis of water using renewable energy will play an important role in reducing greenhouse gas emissions towards the net zero carbon target that the world and Vietnam are pursuing in line with the commitments in COP 26.
Ali Habib, an international consultant, told the workshop: “Vietnam was well positioned for production, but policies and partnerships will be essential to ensure success.”
Vo Thanh Tung, a project expert at the GIZ Energy Support Program, said renewable energy technologies, such as wind and solar power, have developed strongly in recent years, bringing new opportunities to advance the development of the green hydrogen industry.
Many countries around the world have developed strategies for the green hydrogen industry, with specific medium- and long-term goals and ambitions to develop the domestic consumption market. Japan, South Korea, Germany and EU countries also plan to import hydrogen from neighboring countries and the region.
In addition, an important geopolitical factor arising from the conflict between Ukraine and Russia has also boosted the development of this industry, as green hydrogen can store clean energy for a long time, contributing to energy security. It is also considered a very important factor in Europe today.
“Vietnam is a country with huge potential for solar and wind power onshore or offshore, so it is considered to have great potential to produce green hydrogen for domestic use and domestic industries. It has the potential to export to the international market, contributing to reducing greenhouse gas emissions and promoting the development of the green hydrogen industry in the future,” said Tung.
During the workshop, experts pointed to the limited availability of land compared to other major potential exporting countries, such as Australia, Chile and Morocco, as well as a lower quality of resources than some of the other potential competitors, especially solar energy, larger geographical distance from the EU (and thus higher GH2 shipping costs) and higher capital costs than many other potential exporting countries such as Australia or Chile posed a challenge for Vietnam in the production of GH2.
Under such circumstances, Vietnam’s policies and partnerships are essential to success, experts say.
They suggested to Vietnam to set clear long-term targets for green hydrogen production, establish strategic partnerships with major importing countries such as Japan and Germany for green hydrogen production, introduce favorable tax and fiscal rules for green hydrogen production hydrogen, and investigate the introduction of feed-in tariffs for the production of green hydrogen fed into the natural gas network and develop monitoring and certification protocols to ensure compliance with international standards.
At the same time, they urged the country to establish an industrial cluster dedicated to hydrogen production and research.
Vietnam was recommended to introduce standards for the injection of green hydrogen into natural gas infrastructure, provide tax incentives to industries to shift their hydrogen or ammonia consumption to green hydrogen, introduce policies to encourage the use of green hydrogen in key sectors such as shipping and carbon pricing: carbon pricing helps make green hydrogen more cost competitive compared to gray hydrogen.
The workshop, held last week in Ha Noi, discussed international trends in renewable energy development policy towards the net zero target, international experiences in the related fields and global trends for new technology solutions – green hydrogen.
The workshop was in the context of BMWK’s visit to Vietnam from 28 to 30 November to promote the relationship between the two countries through dialogues on the development of the renewable energy policy framework, the potential of green hydrogen in Vietnam, the setting up an energy efficiency club, as well as meetings with German companies in Vietnam.
Since 2013, energy has become one of the priorities of Vietnam-German cooperation, with the establishment of the GIZ Energy Support Program, a collaboration between Vietnam’s Ministry of Industry and Trade (MOIT) and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH .
The program aims to contribute to Vietnam’s strategy for emission reduction and green growth by improving the existing renewable energy and energy efficiency regulatory framework to stimulate private sector investment and by developing the professional and organizational capabilities of key institutions and stakeholders to increase.