Vietnam has officially launched the Resource Mobilization Plan to implement the Just Energy Transition Partnership (JETP), in which economic powers committed to mobilize an initial US$15.5 billion over the next three to five years to help the country deliver its climate targets.
Prime Minister Pham Minh Chinh announced the plan on December 1 at the Vietnam Pavilion at the 28th session of the Conference of the Parties (COP28) in Dubai, UAE, in the presence of EC President Ursula von der Leyen, high-ranking officials from related countries, and representatives of UNDP, World Bank, ADB, among others.
The move makes Vietnam the first country to declare such a resource mobilization plan to pursue its climate commitments.
The JETP was adopted in December 2022 by Vietnam and the International Partners Group (IPG) members in Belgium, comprising the European Union (EU), the UK, the US, Japan, Germany, France, Italy, Canada, Denmark, and Norway.
Through the JETP, foreign partners will assist Vietnam by facilitating policy enhancements, technology transfer, financial support, coupled with mobilizing investments in renewable energy, grid infrastructure, and energy efficiency.
Support will also go to developing manpower for the energy sector, increasing private sector engagement, and promoting the application of carbon capture, utilization and storage while advancing the manufacturing of energy storage equipment, green hydrogen production, and the development of offshore wind power.
Of the total volume, $7.75 billion is expected to be mobilized by IPG members, with more favorable lending terms than the current capital market and the remaining $7.75 billion is committed by the Glasgow Financial Alliance for Net Zero (GFANZ) in private finance to directly support businesses through investments of international corporations and enterprises.
The IPG public funds will be channeled via various financial instruments and mechanisms, such as grants, concessional loans, and risk-sharing instruments over three to five years.
The JETP Resource Mobilization Plan focuses on eight groups of tasks, namely: (1) Improving the regulatory framework for energy transition; (2) Accelerating the transition from coal power to clean energy; (3) Developing industrial and service ecosystem for renewable energy; (4) Energy saving and energy efficiency; (5) Upgrading power transmission and energy storage systems; (6) Greening the energy transition and reducing greenhouse gas emissions in the transport sector; (7) Innovation and technology transfer; and (8) Ensuring a just energy transition.
Projects and tasks will continue to be reviewed, updated, and finalized by the JETP Secretariat, working groups supporting the implementation of the JETP, and partners.
The plan will enable Vietnam to make progress in bringing forward the projected peak year for all of Vietnam’s greenhouse gas emissions from 2035 to 2030; achieving 170 megatons CO2e of annual peak power sector emissions by 2030; capping the maximum capacity of coal-fired power plants at 30.2 gigawatts; and accelerating the pace of renewable energy adoption to ensure at least 47% of electricity generated comes from renewable sources by 2030.
Strong commitments of related parties
Speaking at the launch ceremony, Prime Minister Pham Minh Chinh stated that Vietnam would not be able to fulfill its ambitious climate targets without financial and technical assistance from international partners.
He urged related parties to finalize the agreements soon to provide funds for energy transition projects in Vietnam to support the country’s energy security, climate resilience, and economic growth. He believed that Vietnam could mobilize more than the committed amount of $15.5 billion offered with favorable conditions.
On this occasion, EC President Ursula von der Leyen said that the launch of the Resource Mobilization Plan was a great milestone in the implementation of the JETP, demonstrating Vietnam’s leadership in paving the way for a clean energy future.
British Prime Minister Rishi Sunak said he believed the plan would unlock the vital financing needed to accelerate Vietnam's transition from fossil fuels to clean energy. It will help meet Vietnam’s ambitious climate and economic goals while ensuring that working people and communities are not left behind – delivering a fair transition to net zero, he added.
Canada’s Prime Minister Justin Trudeau affirmed that his country continues to support cleaner energy and coal phase-out in Vietnam and looks to the future where the JETP will contribute to a global legacy of responsible energy practices and shared prosperity.
The Prime Minister of Denmark, Mette Frederiksen, said that at this critical moment in Vietnam’s transition, Denmark and IPG stand ready to support Vietnam to get on track its ambitious net zero 2050 goal. Denmark is committed to sharing its experience and know-how to support Vietnam’s just energy transition.
Meanwhile, French President Emmanuel Macron said the plan is a key milestone in paving the way for a just energy transition that leaves no one behind. It symbolizes collective efforts to enable Vietnam to achieve its ambitious climate goals and accelerate its transition away from fossil fuels.
German Chancellor Olaf Scholz said they would work together to create a favorable framework and implement the plan swiftly. Germany is committed to providing substantial financing for implementing the JETP and working hand-in-hand with the government, civil society, and the private sector to ensure a transparent and equitable process.
The Prime Minister of Italy, Giorgia Meloni, said the launch of the plan marks an important step forward in the collective efforts to support and accelerate Vietnam's energy transition towards a sustainable future.
The Prime Minister of Norway, Jonas Ghar Støre, affirmed that Norway stands ready to contribute to implementing the plan through investments and sharing of expertise and experience.
US Special Presidential Envoy for Climate, John Kerry, said the US will continue to support Vietnam in this important endeavor to create the foundation and investment environment for a dynamic and just green economy and a cleaner future for the Vietnamese people.
This story was produced as part of the 2023 Climate Change Media Partnership, a journalism fellowship organized by Internews' Earth Journalism Network and the Stanley Center for Peace and Security. It was first published by Hanoi Times on 2 December 2023.
Banner image: Vietnam's Prime Minister Pham Minh Chinh at the launch ceremony in Dubai on Dec 1 / Credit: Nhat Bac/VGP.