For the last 15 years, the power sector has made strong development, providing an important contribution to national economic growth, actively serving the industrial and agricultural development and enhancing the quality of people’s lives. By 2010, the power sector wants to raise the total power generation capacity to 14,500 MW. This is a high objective requiring immediate investment in building new hydraulic and thermal plants.

 

In 2004, the power sector produced 46 billion KWh of power, up by 73 percent over 2000 and increased by 3.7 times against 1994. However, this has not met the requirements of the rapidly developing economic sector and civil consumption. The average power consumption is only 561 KWh/ person/year, or in 131st position in world ranking. Meanwhile, 44 countries in the world have generated over 1,000 KWh ( produced 27,000 KWh, the : 14,000 KWh and : 11,000 KWh).

Recently, the Northern provinces have suffered from serious power shortages. However, due to the construction delay, the second circuit of the 500 KV transmission line has been connected to Ha Tinh, therefore, it is now possible to transmit power from the South to the North. If the second circuit is connected, the additional supply of 400 MW for Hanoi can regulated from Yaly hydraulic power plant (capacity of 720 KW), five Phu My plants (capacity of over 3,800 MW) and others power plants. That means, more than 1,000 MW can be transmitted from the Southern and Central regions to the North. With the existing power generation capacity, power shortage is a big problem, which is difficult to resolve in a short time. It forced the State to invest in thermal power, which received less attention for a long time.

The economic efficiency of Hoa Binh and Tri An hydraulic power plants has made the sector’s leaders attach less importance to thermal power and other clean power sources. The expansion of Pha Lai and Uong Bi thermal plants as well as the development of local thermal plants have not received appropriate attention. Large and small hydraulic power plants are considered as the other advantage of . Copying the models of hydraulic power plants in some other countries, the power sector forgot that many European and Asian countries including and are returning to thermal power, especially using coal in power generation. , the country developed largest hydraulic power plants in the world, still buys high quantities of coal from for power generation which it then sells to at high prices. Furthermore, world coal prices have increased by 140 per cent, while the coal price in has seen an insignificant increase. Buying power from abroad caused the power sector to compensate the losses of nearly VND600 billion per year. However, the economic loss caused by power cuts is up to thousands of billion Vietnam Dong. More importantly, the negative impacts on the national economy and people’s lives are difficult to calculate.

At the recent meeting with Electricity of Vietnam (EVN), the Deputy Prime Minister Nguyen Tan Dung settled all the problems of the power sector. In terms of the investment capital for power generation plants, they are allowed to borrow loans exceeding their own capital by 15 percent in order to quickly put 15 new power plants into operation in 2010. The investment in constructing the second circuit of the 500 KV transmission line from Ha Tinh to Thuong Tin (Ha Tay province) has been given priority for acceleration. Power purchasing from as well as power saving have been considered important measures.

According to the forecast, will lack about 500 KWh and 1 billion KWh of power in 2006 and 2007, respectively. The power sector is taking initiative in speeding up some constructions for producing additional 1,200MW by 2006. This calculation was made according to the average power consumption in the previous years. However, if in every province, the power consumption increases sharply by 40 percent a year like Binh Duong, the shortage will be double or triple this figure.

Using coal for power generation is a new advantage of because the environment pollution has been well treated by advanced technologies. has high reserves of coal especially the coal giving low heat suitable for power generation in Quang Ninh, Thai Nguyen as well as in the northern plain and many places in the central and southern regions. The coal industry is investing in developing the thermal power plants in Na Duong, Cao Ngan, Cam Pha, Son Dong and other places. The power sector should pay more attention and support to localities for building more thermal power plants of high, medium and low capacity using coal to ensure the power provision for the national power grid.

The Vung Ang Industrial Park (Ha Tinh) has a deep seaport, favourable for accommodating ships of 45,000 – 50,000 tonnes. Recently, the Ministry of Transport has started the construction of the 2^nd wharf for raising the discharging capacity to 1.32 million tonnes per year. In the future, after the completion of Son Duong Port in Ha Tinh, ships of 150,000 – 200,000 tonnes will be allowed to arrive. There are the national roads No1A and 12A (connected to ), the 500KV, 220KV and 110KV power transmission lines (it is 15km from the port to the point of junction of the 220KV transmission line and 10 km to the 110KV transmission line). The clean water supply system for production and civil consumption from Kim Son Lake (capacity of 18 million cubic metres) has been developed. The province is processing the construction formalities for the water reservoir of Tri River (60 million cubic metres) to supply water for the industrial park, port and agricultural production.

The Vung Ang Industrial Park has been selected as the location for developing the metallurgy complex, capacity of 4.5 million tonnes per year for utilising the ores from Thach Khe iron mine as well as imported sources. The Ministry of Industry has submitted the planning of the national metallurgy centre to the Government. The power supply for the metallurgy complex should meet very strict requirements: uninterrupted power supply with stable voltage and frequency. After putting it into operation, apart from generating power to the national power grid, it still serves as a hot reserving source for the metallurgy centre.

In the regional development planning, (under the Resolution No39 NQ/TW of the Politburo and the Decision No113/2005/ QD-TTg of the Prime Minister), up to 2010, the Urban and Industrial Area in the South of Ha Tinh will be formulated. This important economic zone will need about 600MW of power in 2010 and 1000MW in 2020 (particularly, the Vung Ang metallurgy complex will need 275 MW for oxygen blown blast-furnace, 575 MW for the Corex- Midrex technology not included the power demand of factories in the industrial park).

According to the Notice No. 117TB-VPCP, dated 21^st of June 2005 on the conclusion of the Deputy Prime Minister Nguyen Tan Dung, this place will be developed into a power centre. The project of building the Vung Ang Thermal Power Plant is invested by the Vietnam Machineries Installation Corporation (LILAMA). LILAMA is a competent economic corporation having experience in execution of large-scale industrial projects, especially thermal power plants. The corporation has undertaken the biggest bidding package of Uong Bi Thermal Power Plant Expansion Project (designing, manufacturing and installing equipment) as well as taken part in many bidding packages of thermal-gas power plants at Phu My Power Centre (Ba Ria – Vung Tau). The investment in the Vung Ang Thermal Power Plant of LILAMA is a right and necessary decision, which is suitable to the planning on source-network development of the Electricity of Vietnam and capable of exploiting favourable factors in the construction, power production and trading.

According to the plan, at the first stage, there will be two power generating engine of 300MW/each (2 steam furnaces, 2 steam turbines and 2 power generators). The voltage connected to the national grid is 220KV and 110KV. The power output will reach 3.6 billion KWh / year. In the 2^nd stage, two engine groups will be added for raising the capacity to 600MW. The main fuel is Antraxite coal, exploited from the coal mines in Quang Ninh and Cam Pha. The secondary fuel is FO diesel (No5 under ASTM standards). The water source for cooling the condensers will be taken from the source of Tri River .

For the technology, the coal furnace blows in the natural circulation with indirect coal burning. The overheated steam productivity at norm consumption is 920 tonnes/h; overheated steam pressure: 180kgf per square centimetre; overheated steam temperature: 538⁰C; the furnace productivity is not less than 88 percent (when the capacity is lower 70 percent, the diesel is used as additional fuel). The plant will use single-shaft turbines, steam condense with overheat and re-dried moderator with water supply additional heat, the capacity norm: 303MW; rotation speed: 3000 revs per minute. The transformer station will have the capacity of 357MVA; primary voltage: 19KV and secondary voltage: 220V.

Currently, the Ministry of Industry is directing to set up the planning for VI power and the planning for the Power Centre in Vung Ang as well as its investment phases (with the Vung Ang Thermal Power Plant in the 6 diagram). The Government has allowed LILAMA to arrange the finance for setting up the investment report of the thermal power plant project at Vung Ang Industrial Park , identifying the scale and suitable capacity for submitting to the government in compliance to the present regulations.

According to the plan, from August of 2005 to the end of the first quarter of 2006, the survey will be carried out for setting up the feasible study and submitting for approval. From the 2^nd quarter to the end of the 4^th quarter of 2006, the technical design and total financial estimation will be submitted. The plant’s construction will be started at the beginning of 2007 and put into operation by the end of 2010.