Inaugurating BOT Thermal Power Plant Van Phong 1

Van Phong Economic Zone, Ninh Yen village, Ninh Phuoc commune, Khanh Hoa town, Khanh Hoa province, Van Phong Power Company Limited held the inauguration ceremony of Van BOT Thermal Power plant Van Phong 1 on 13 March 2024.

Source: Vietnam Energy

It is one of the key energy projects, contributing to the electricity demand of Khanh Hoa province as well as the Southern and South Central regions. Van Phong 1 BOT Thermal Power Plant was started in 2019 with an investment of nearly US$2.58 billion, including 2 units with a total installed capacity of 1,432 MW, and a net capacity of 1,320 MW. 

The Van Phong plant uses supercritical boiler technology with a series of modern equipment, with high efficiency and strict Vietnamese and international environmental standards. The Van Phong 1 BOT Thermal Power Plant will officially provide the national grid with about 3% of the total national electricity output.

The plant is expected to ensure electricity supply for production, business, and household consumption for Khanh Hoa province, the southern region and the entire country. This is the largest FDI project in Khanh Hoa province, invested by Japan’s Sumitomo Group.

The Van Phong Power Company Limited (VPCL) is an enterprise established by an investor with 100% capital. The project is invested in build-operate-transfer (BOT) under the BOT contract signed by the Ministry of Industry and Trade (representation of the Vietnam Government), and will be handed over to the Vietnam Government after 25 years of operation.

The project’s general contractor is a consortium of contractors such as IHI Corporation ESSC, CTCI Corporation and Doosan Heavy Industries & Corporation. After more than four years of construction, the entire plant has been completed and officially put into commercial operation from 24 January 2024 (before the deadline committed to the Vietnam Government).

The VPCL and a consortium of contractors achieved this success after overcoming a series of difficulties during the COVID-19 epidemic. During construction, the project achieved more than 27.8 million safe labour hours. The investor always seriously applied the international safety standards in construction work. Social responsibility was also known for many practical livelihood support and social security programs.

In 4 years, VPCL contributed more than 16 billion VND to social security programs, taking care of 7,000 people each year, including nearly 70% of the children and elders. In addition, during the construction phase, the project created jobs for nearly 2,000 workers in Khanh Hoa province, contributing to the socio-economic development of the province.

Speaking at the inauguration ceremony, Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc emphasised the Van Phong 1 BOT Thermal Power Plant coming into operation will contribute to ensuring electricity supply and maintaining national energy security, as well as improving relations between Vietnam and Japan to “Comprehensive strategic partnership for peace and prosperity in Asia and the world” within the framework of visit to Japan by Vietnam President Vo Van Thuong in November 2023.

The Deputy Minister expressed hope that Sumitomo Group’s investment projects in Vietnam will strengthen cooperation with domestic businesses to increase the localisation rate and expand the domestic supply chain associated with transfer technology for Vietnamese businesses, creating favorable conditions for Vietnamese businesses to participate in the global supply chain.

At the same time, creates conditions for Vietnamese workers to learn, to be trained and to participate in important stages in the production process of projects.

“On the side of the Ministry of Planning and Investment, we commit to closely coordinate with relevant ministries, agencies and Khanh Hoa Provincial People’s Committee in removing obstacles and supporting the Group to effectively implement the projects in the Van Phong economic zone in particular. At the same time, we continue to successfully implement investment and business activities in general in Vietnam,”  Nguyen Thi Bich Ngoc affirmed.

The Chairman of Khanh Hoa Provincial People’s Committee Nguyen Tan Tuan said that Van Phong 1 BOT Thermal Power Plant is the largest-scale industrial project in Khanh Hoa province (up to this point), and dynamic project with important significance in the socio-economic development of Khanh Hoa province in generally and Van Phong Economic Zone particularly.

The project will have the power to spread, promote and attract investment into the Van Phong Economic Zone, develop local industry, and create momentum for the economy of Khanh Hoa province and South Central region while creating many jobs and contributing to the local budget with an estimated VND 1,000 billion per year.

“From today’s achievements, Khanh Hoa believes and hopes that Sumitomo Group, domestic and foreign corporations and businesses will continue to research, propose and implement new industrial, infrastructure and service projects in the province. The Khanh Hoa province commits to accompany, engage and fully support investors to achieve common goals,” Nguyen Tan Tuan shared.

General Director of Van Phong Electric Co., Ltd. Hirokazu Tsuru affirmed that strong supports from the Central and Local governments are the most important factors for the project, contributing to the completion of the plant construction in the schedule. The company especially appreciates and appreciates all the support and assistance from the Vietnam Government of and Khanh Hoa province during the project development and construction process.

In particular, the company must mention the reliable support and cooperation of Electricity of Vietnam (EVN) when completing the 500 kV Van Phong – Thuan Nam line and Van Phong transformer substation in a short time, as well as close coordination of EVN companies during the process of building and testing the plant.

“The collective of Van Phong Electricity Co., Ltd. is confident in being able to contribute to Vietnam’s economy and society through the stable operation of the plant, as well as actively deploying and participating in the support activities of the community and local social security,” Hirokaru Tsuru said.

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