The French Development Agency (Agence Française de Développement or AFD) has funded EUR24.2 million (US$26.7 million) for a solar power project in Vietnam as part of efforts to help the country intensify its renewable power strategy.
|Nguyen Xuan Nam, deputy general director of Vietnam Electricity (EVN), and Rémi Genevey, director of AFD’s East Europe, Middle East, and Asia Department, signed agreement for Se San 4 project. Photo: EVN
Signed last month by Rémi Genevey, director of AFD’s East Europe, Middle East, and Asia Department, and Nguyen Xuan Nam, deputy general director of Vietnam Electricity (EVN), the non-guaranteed loan will finance the 49-MW Se San 4 solar farm in the Central Highlands province of Kon Tum.
The loan is in line with AFD’s support to Vietnam in the energy transition switching to low-carbon sources that Vietnam has committed to pursue following the Paris Agreement.
Se San 4 is EVN’s first solar farm which makes full use of infrastructure and network set for Se San 4 Hydropower Plant.
The latest funding indicates the long-term partnership between AFD and EVN which has lasted for more than two decades.
This is AFD’s second non-guaranteed loan in Vietnam and it will not affect the country's public debt. AFD and EVN plan to make other direct loans for hydropower and power transmission projects which are in need of capital amid the decreasing guaranteed loans.
Vietnam has struggled to feed the fast-growing economy, including the annual power growth rate of 10%. The country, therefore needs to raise the power capacity from 60 gigawatts (GW) in 2020 to 129.5 GW by 2030.
For sustainable growth, Vietnam has been switching to renewable energy with significant investment in solar and wind power.
AFD has operated in Vietnam since 1994, funding the country more than EUR2 billion (US$2.2 billion) in 86 sustainable development projects.