Phasing out existing coal-fired power generation through ‘just’ transition

Submitted by saladin on Thu, 03/31/2022 - 13:26

Measures

Phasing out existing coal-fired power generation through ‘just’ transition

While coal has been the backbone of Viet Nam’s power sector, it is appropriate to consider alternatives in future energy planning. This is not only because Viet Nam will miss out the NDC unconditional target (albeit a low target compared to other countries around the world – Indonesia aims to reduce by 29 per cent unconditionally) but coal-based generation is more expensive than its counterpart renewables. This gap will continue to widen as the costs of renewables decline further. As such, phasing out of coal has started globally – an increasing number of countries are announcing their coal phase-out plans. Estimates have suggested that in order to be in line with the Paris Agreement’s temperature goals, the countries in Asia and the Pacific should: (a) stop investing in new coal generation after 2020; (b) reduce coal for power generation by 63 per cent below 2010 levels by 2030; and (c) achieve full phase-out by 2040 (UNESCAP 2021b). Viet Nam has made an encouraging announcement in COP 26 that the country will reach net zero carbon emissions by 2050. The Government has made a commitment to stop deforestation by 2030 and to phase out coal-fuelled power generation by 2040 (Viet Nam Briefing, 2021).

It would be appropriate for Viet Nam to start preparing for coal phase-out by developing a comprehensive long-term strategy to minimize severe impacts to the economy. Experts (ILO, 2018) believe that if the transition starts early and is managed through ‘just’ transition, the socio-economic impact will be far less than it would be by not doing so.