Vietnam Kills Nuclear Power Project Due to High Costs

The Vietnamese government has canceled the Ninh Thuan Nuclear Power Plant project, after cost estimates for the plant nearly doubled, according to the Hanoi-based news agency dtinews.

Le Hong Tinh, vice chairman of the National Assembly Committee for Science, Technology, and Environment, in an interview conducted with dtinews on November 10, said costs for the project had increased to VND400 trillion ($19 billion), raising concerns about the project’s feasibility. Although the country has spent trillions on the endeavor already, it is willing to cut its losses now rather than throwing good money after bad on the development.

Many things have changed since the project was approved in 2009. At the time, annual economic growth estimates were in the 7.5% to 10% range, and electricity demand was expected to follow suit. But that never materialized. Current growth estimates are only around 6%, and energy efficiency improvements, spurred by the proliferation of modern technology, have held electricity demand growth in check.

The Fukushima Daiichi nuclear disaster was also a detriment to the project. Delays ensued following the 2011 incident, and in September 2014, Vietnam’s Trade Ministry said work would not begin on the first of eight planned units until at least 2020. In late 2015, Hoang Anh Tuan, director general of the Vietnam Atomic Energy Agency, said, many hurdles, including lack of experience and a workforce shortage, were in the country’s way as it worked toward building its first reactor.

But economics seem to have been the death knell for the project. According to dtinews, Duong Quang Thanh, chairman of the Vietnam Electricity Corp., told the media on November 9 that the price of nuclear power was much more expensive than other options, such as coal or oil, making it uncompetitive. Le Hong Tinh seemed to echo the sentiment, suggesting that original estimates priced nuclear power at 4¢–4.5¢/kWh, but based on the latest cost projections, the plant’s power would have been priced closer to 8¢/kWh.

Aaron Larson, associate editor (@AaronL_Power, @POWERmagazine)