Sweetening the Deal for Biomass Energy in Viet Nam’s Sugar Industry

At a Glance

Publication Date September 2023
Format pdf
Country Viet Nam
Thematic Area Sustainable Energy

Viet Nam’s impressive economic transformation over the past two decades has gone hand in hand
with a rapid increase in demand for energy. The strategies of the Government of Viet Nam (GoV) are
to ensure that future economic growth is more sustainable. As such, whilst modest, the Revised Power
Development Plan 71 (PDP7) has set targets for renewable energy development including solar, wind
and biomass energy. Biomass energy is set to take up 2.1% of total electricity production by 2030.
This insight brief analyses the potential contribution of biomass energy to the development of the
power sector in Viet Nam, with a focus on the sugar industry. The electricity generation in this industry
requires either single fuel (bagasse only) or multi-fuel (bagasse and other types of biomass such as wood
chips and rice husks, among others). The brief examines the challenges and opportunities in scaling up
the development of bagasse energy projects in Viet Nam through the pre-feasibility studies (pre-FS)
that GGGI and GIZ have jointly developed together with five sugar mills in Viet Nam. Based on this
analysis, the brief presents key considerations in enhancing the bankability of biomass energy projects.

This brief is intended for policy-makers, sugar mills, project developers, financial institutions, relevant
associations (sugar, clean energy etc.), national and international organizations which are interested in
the development of Viet Nam’s renewable energy sector and the public at large.
This brief as well as the five pre-FS which the analysis is based on are jointly prepared and funded by
GGGI and GIZ. This cooperation falls under the framework of a Memorandum of Understanding signed
in 2011 in which GIZ and GGGI committed to establish an active cooperation in combating global
climate change and promoting green growth and sustainable development in developing countries. In
Viet Nam, the collaboration between the two institutions kicked off in 2016 aiming to assist the GoV to
reach its biomass energy targets by accelerating the development of provincial biomass energy planning
and enhancing bankability of biomass energy projects, with a focus on the sugar industry