A future coal-fired power station in central Vietnam may soon be funded by Singapore’s DBS Bank, according to environmental groups familiar with the matter.
This is despite DBS announcing in April that it will stop financing new coal-fired power plants after honouring existing commitments.
In a letter to DBS chief executive Piyush Gupta on Sept 19, a group of Japanese and Australian environmental groups – including Kiko Network and Mekong Watch – urged DBS to reconsider funding Vung Ang 2 power station.
This project is located in central Ha Tinh province, near the steel plant of Taiwanese-owned Formosa Plastics, which spilled toxic waste into the sea in 2016, decimating marine life and leaving thousands of fishermen jobless.
The Vung Ang 2 project is sponsored by One Energy Ventures, a joint venture between Diamond Generating Asia – a Mitsubishi Corporation subsidiary – and China Light and Power.
DBS said it does not comment on individual projects.
“Our coal policy recognises the absolute need to keep to our carbon cap, our planetary boundaries, but it also recognises this need for balance. Countries in South-east Asia have significant energy needs over the coming decades,” said a DBS spokesman in an e-mail.
“Our coal policy, announced earlier this year, commits us to stop any new coal-fired plant financing after our current commitments to customers are completed.”
Like Cambodia, Vietnam has one of the fastest growing economies in South-east Asia and has forecast that its power generation will need to rise from around 47,000 megawatts (MW) now to 129,500MW by 2030.
Hydropower and coal currently dominate Vietnam’s energy mix, each making up some 40 per cent of its installed capacity. Vietnam is banking on coal to quickly raise electricity production, while promoting renewable sources like solar.
By Tan Hui Yee from Straitstimes