The Asian Development Bank (ADB) on January 22 agreed to provide a US$37.8-million loan to Thailand’s power producer Gulf Energy Development Public Company (GED) for a 50-megawatt photovoltaic solar power project in southern Vietnam.

Representatives from ADB, JICA, Bangkok Bank PCL, Siam Commercial Bank PCL, and Standard Chartered Bank (Thai) PCL at the signing ceremony on Jan 22. Photo: ADB.

The financing package includes an US$11.3 million A loan and up to US$18.9 million B loan which will be funded by Bangkok Bank PCL, Siam Commercial Bank PCL, and Standard Chartered Bank (Thai) PCL.

The loan was signed with Vietnamese Thanh Thanh Cong Group’s TTC Energy Development Investment JSC, which is 90%-owned by GED.

The funding will be utilized for the development of Gulf Solar Power project in the southern province of Tay Ninh, which is about 50km northwest of Ho Chi Minh City.

Additionally, the funding also includes a US$7.6 million loan provided by Leading Asia’s Private Infrastructure Fund, which is supported by the Japan International Cooperation Agency (JICA).

It will help catalyze commercial financing for one of the first large-scale solar power project finance transactions in Vietnam, according to ADB.

Upon completion, Gulf Solar Power facility will serve the energy demand of residents and businesses of Ho Chi Minh City and its surrounding areas, while offsetting 29,760 tons of CO2 emissions per year by 2020.

GED executive director Yupapin Wangviwat said: “We believe the project’s fundamentals were improved significantly as a result of its competitive financing structure and longer tenor led by ADB, and we are confident that the project will be developed successfully according to plan.”

ADB private sector operations department infrastructure finance division director Jackie Surtani said: “Apart from providing much-needed financing to develop solar power in Vietnam, the project will also help reduce perceived risks in the country’s renewable energy sector.”

In October 2019, ADB agreed to finance US$37 to Da Nhim–Ham Thuan–Da Mi Hydro Power (DHD) for the installation of a 47.5MW floating solar power facility on the reservoir of an existing hydropower plant in Vietnam.

Vietnam aims to increase the share of renewable energy sources, such as hydropower, solar, wind, and biomass, to 21% of the total installed capacity by 2030 with an aim to meet rapidly growing energy needs and reduce greenhouse gas emissions by up to 25% by 2030.