General Electric, Independent Power Supplier Plan Vietnam Wind Projects
September 27 2016 - 12:44PM
Dow Jones News
By Rick Carew
HONG KONG -- General Electric Co. is teaming up with an emerging
market-focused renewable power developer to build $1.5 billion of
new wind projects in Vietnam.
Ireland-based Mainstream Renewable Power Ltd. signed a deal to
develop large-scale wind power plants in Vietnam with GE putting up
a portion of the funding and providing technology, a Mainstream
Renewable executive said in an interview Tuesday.
"Vietnam is going to be a huge importer of energy" as the
economy grows, said Mainstream Renewable Chief Operating Officer
Andy Kinsella. "There's huge demand for power and they can balance
the equation with renewables."
Countries like Vietnam are pushing to increase the share of wind
and solar to power their economic growth as the cost of generating
renewable energy declines, making it competitive with coal and
liquefied natural gas. Vietnam's government has set a target of
increasing its power output to more than 330 billion kilowatt-hours
by 2020 from roughly 200 billion kilowatt-hours in 2015.
That expanding power supply could help meet rising demand as it
tries to boost economic growth.
"Vietnam continues to outperform," said HSBC Asia economist
Frederic Neumann in a note Tuesday to clients. "[T]he government is
pressing ahead with structural reforms, which, if pursued
rigorously, should lift Vietnam's growth rate over time."
For General Electric, the wind power projects fit with its push
into fast-growing markets and a shift in its financing operations
to focusing primarily on funding infrastructure projects where it
can apply its industrial technology.
Mainstream Renewable Power is a major independent power supplier
focused on growing markets including South Africa and Chile. In
August it won contracts to supply renewable energy in Chile as part
of the country's largest ever power auction that awarded contracts
to supply electricity over 20 years starting in 2021.
The $1.5 billion investment by Mainstream Renewable and GE in
Vietnam will be funded with a mix of equity and debt. Construction
on the projects are expected to begin in 2018 and will add 1
gigawatt to Vietnam's overall power capacity. Vietnam's overall
power capacity was at 34 gigawatts at the end of 2014, according to
government figures.
The foreign aid arm of the U.S. government estimates that
installed wind power capacity in Vietnam is currently 135
megawatts.
Write to Rick Carew at rick.carew@wsj.com
(END) Dow Jones Newswires
September 27, 2016 12:29 ET (16:29 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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