Song Hau Thermal Power Plant

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Song Hau Thermal Power Plant is an operating power station of at least 1200-megawatts (MW) in Hau Giang Industrial Park, Mai Dam, Chau Thanh, Hau Giang, Vietnam with multiple units, some of which are not currently operating. It is also known as Hau River.

Location

Table 1: Project-level location details

Plant name Location Coordinates (WGS 84)
Song Hau Thermal Power Plant Hau Giang Industrial Park, Mai Dam, Chau Thanh, Hau Giang, Vietnam 9.95266, 105.86071 (exact)

The map below shows the exact location of the power station.

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Unit-level coordinates (WGS 84):

  • Unit 1-1, Unit 1-2, Unit 2-1, Unit 2-2, Unit 3-1, Unit 3-2: 9.95266, 105.86071

Project Details

Table 2: Unit-level details

Unit name Status Fuel(s) Capacity (MW) Technology Start year Retired year
Unit 1-1 operating coal - bituminous 600 supercritical 2021
Unit 1-2 operating coal - bituminous 600 supercritical 2022
Unit 2-1 permitted coal - bituminous 1000 supercritical
Unit 2-2 permitted coal - bituminous 1000 supercritical
Unit 3-1 cancelled coal - bituminous 1000 supercritical
Unit 3-2 cancelled coal - bituminous 1000 supercritical

Table 3: Unit-level ownership and operator details

Unit name Owner
Unit 1-1 PetroVietnam Power Corporation JSC (PV Power) [100.0%]
Unit 1-2 PetroVietnam Power Corporation JSC (PV Power) [100.0%]
Unit 2-1 Toyo Engineering & Construction [100.0%]
Unit 2-2 Toyo Engineering & Construction [100.0%]
Unit 3-1 to be determined [100.0%]
Unit 3-2 to be determined [100.0%]

Project-level coal details

  • Coal source(s): imported

Background

Sông Hậu-1

In April 2010, Vietnam's state oil and gas group Petrovietnam began initial construction on the $1.5 billion, two-unit, 1,200-MW Sông Hậu-1 power station.[1] In February 2011, the Japan International Cooperation Agency signed an agreement with Vietnam's Ministry of Industry & Trade to extend financing to the project.[2]

In September 2014, with the project having been stalled for several years, Vietnam Minister of Industry & Trade pushed the plant's developer and contractor to get to work. By this schedule, construction would break ground in December 2014, with completion of the first unit in late 2017 and the second in early 2018.[3][4]

In April 2015, after long delays, Petrovietnam signed on Vietnamese company Lilama Corporation as the plant's engineering, procurement, & construction (EPC) contractor. According to the contract, Unit 1 would be completed in Q2 2019 and Unit 2 in Q4 2019.[5] Construction began in May 2015.[6] As of May 2017, construction was on track for 2019 completion.[7]

In early 2017, there were a number of news articles suggesting that the bidding process for various components of the plant (especially the flue-gas desulphurization system) were flawed, resulting in cheap and potentially faulty components being used.[8][9]

In November 2018, the plant's high and intermediate pressure turbines were installed and construction was expected to be complete by 2020.[10] As of January 2019, construction was 70% complete.[11]

In June 2019, the completion date for Sông Hậu-1 was delayed to 2021 in the Ministry Of Industry And Trade's report on the implementation of the revised seventh Power Development Plan (PDP7).[12] In August 2019, construction was 77% complete and the project was running two years behind schedule.[13] The project has been delayed by a funding shortfall that has left contractors unpaid and by delays in building the 120 km-long Hau River-Duc Hoa 500 kV transmission line, which would carry power from the plant.[13]

In November 2020 Unit 1 was connected to the national grid and was on schedule to be commissioned in Q1 2021.[14] Unit 2 was connected to the grid in January 2021.[15] In May 2021, construction was 96.8% complete, and both units were expected to begin commercial operation by the end of 2021.[16] Construction of Unit 1 was completed in November 2021 but the plant was not yet commissioned. Construction of Unit 2 was scheduled to be completed in February 2022.[17] Unit 1 was commissioned on Nov. 27, 2021.[18]

On July 4, 2022, the Ministry of Industry and Trade appeared to provide an update on the draft PDP. The document’s list of major power projects planned for 2021-2030 (PDF pages 18-20) states that construction of Unit 2 had finished and test runs had begun. The plant was slated for operation in the second half of 2022.[19]

In July 2022, an inauguration ceremony for Song Hau 1 took place. According to reports, the power station's Unit 2 came online for commercial operation earlier in the year.[20]

In August 2023, Viet Phat Import-Export Trade Investment Joint Stock Company signed a VND 6,023.7 billion agreement to supply coal for Sông Hậu-1 in 2023-2024.[21]

Sông Hậu-2

In April 2011, Toyo Ink Group Berhad, the Malaysian branch of Japan's Toyo Ink Group, announced that it would be pursuing the development of the two-unit, $3.5 billion, 2,000-MW Sông Hậu-2 plant, after provincial authorities approved the company's proposal.[22] In January 2012, Toyo Ink signed a consultancy agreement with Vietnam's Power Engineering and Consulting Joint Stock Company 2 for the construction of the plant.[23]

In August 2013, Toyo Ink signed a memorandum of understanding with the Ministry of Industry & Trade for construction of the plant. The plan calls for the first unit to come online in 2021, and the second in 2022. The Ministry stated that it would sign a build, operate, & transfer (BOT) agreement with Toyo Ink as soon as the latter lined up coal suppliers and electricity sales agreements; Toyo Ink stated that it expected the BOT agreement to be finalized in 2014. Coal would be imported from Indonesia or Australia. Industry experts apparently believed that negotiating the power price with Electricity of Vietnam would take time, and would potentially lengthen this time frame.[24]

As of mid-2015, the BOT agreement had apparently not yet been finalized. In July 2015, Toyo Ink sought shareholders' permission to spend an additional $35 million on consultancy costs for Sông Hậu-2.[25] In October 2016, provincial officials noted that site clearance was behind schedule, and called on district officials to strengthen the procedures for resettling people living on the site.[26]

In January 2017, Toyo Ink signed a land lease agreement with the Vietnamese authorities for the plot on which the power plant will be located. The project had an estimated project cost of US$3.45 billion, and Toyo Ink said it was looking at jointly developing the project via a special purpose vehicle (SPV) with a partner, but will retain a 40% equity interest to remain the single largest shareholder of the project. The SPV will fund about 25% of the total cost, while the remaining 75% will be financed via bank borrowings.[27]

In February 2017, Vietnam’s Ministry of Natural Resources and Environment approved Toyo Ink’s environmental impact assessment for the Song Hau 2 coal plant.[28]

In a visit to the area in March 2017, Vietnam's Deputy Prime Minister called for accelerated price negotiations to help speed up the project.[29]

As of late November 2017, the BOT contract had not yet been signed, and the EIA was being revised.[30]

In September 2018, Toyo Ink estimated that the plant would be commissioned by 2025.[31] In June 2019 the completion date for Sông Hậu-2 was listed as 2024 in the Ministry Of Industry And Trade's report on the implementation of the revised seventh Power Development Plan (PDP7).[32] In February 2020 the National Steering Committee stated that Unit 1 was scheduled to be commissioned in Q1 2025 and Unit 2 in Q2 2025.[33]

As of early March 2020, there were no indications that financing for the Sông Hậu-2 plant had been secured.

In December 2020 it was announced that Toyo Ink had signed the BOT contract with Vietnam's Ministry of Industry and Trade for the Song Hau 2 project, with a government guarantee from the Vietnamese government also attached to the deal. The government guarantee includes protection for the company against default on all Vietnam project counterparties, changes in law and government event risks. Further guaranteed is at least 30% of the conversion from Vietnamese Dong to US dollars for the project’s tariff revenue that is received under the power purchase agreement after deducting all operational expenditures. The Vietnamese government has also granted the project tax incentives, including favourable corporate income tax rates and exemption from import duties. Toyo said that the estimated US$3.23 billion project costs "will be financed via a mix of debt and equity financing. The board is still in the midst of reviewing various investments and funding options, including identifying strategic investors and other suitable parties to co-invest in the project."[34]

In January 2021, Toyo Ink announced that it was partnering with China Energy Engineering Corporation, a Chinese state-owned enterprise, to develop Song Hau 2. The two companies had entered into an investment and development agreement, through which China Energy would acquire an equity stake in the project.[35]

In May 2021, the People's Committee of Hau Giang province was working on plans to resettle 714 households to clear the construction site of Sông Hậu-2.[36]

An October 2021 report by GreenID lists the Sông Hậu-2 power station as one of 18 coal-fired power stations in Vietnam that was struggling to secure financing. Given that China, Japan, and South Korea have all committed to stop financing new coal-fired power stations, it will be extremely difficult for any of these projects to secure funding in the future.[37] In March 2022, Report No. 1562 by the Office of the Government of Vietnam stated that the plant was financially troubled.[38]

In January 2023, IJ Global wrote that Toyo Ink targets to arrange $2.4billion syndicated financing facilities with a debt/equity ratio of around 75.25. Export-Import Bank of Malaysia was signed up in November 2022 as the MLA, bookrunner and arranger for the project's debt financing.[39]

In February 2023, Toyo Ink was continuing to pursue the project. They claimed to have (Google translate): "a solution to solve the problem of funding for compensation and resettlement remaining". The investors and developers stated that they were awaiting approval by the Ministry of Industry and Trade.[40] 742 households impacted by Sông Hậu-2 were to be resettled in the Mai Dam Resettlement Area.[41]

In March 2023, Toyo Ventures stated that a US$86 million operation and maintenance contract for Sông Hậu-2 had been awarded to Power Engineering Consulting Joint Stock 2 (TV2). This was in addition to a US$2.42 billion construction contract awarded one week prior. Toyo Ventures also stated that the Export-Import Bank of Malaysia had offered to be the "mandated lead arranger and bookrunner and coordinating arranger for the syndicated financing facilities of up to US$2.42 billion for the construction of the power plant". The project was expected to be operational within four and a half years of construction start.[42]

In May 2023, Vietnam officially approved the updated power development plan (PDP8). Under this plan, the country will domestically generate 20% of its electricity needs with coal by 2030 and fully phase out coal-fired power stations by 2050. The plan involved increasing energy generation using coal to a peak of 30 GW and replacing all other outstanding coal projects with LNG or renewables. PDP8 listed Song Hau II among the projects that were "behind schedule, facing difficulties in changing shareholders, arranging capital". The proposal was not officially cancelled, but it was required to either move forward by June 2024 or be terminated.[43]

As of December 2023, construction of Sông Hậu-2 was expected to begin in 2024.[44]

In January 2024, the Southern Power Project Management Board announced that they were moving forward with a 133 km, 500kV transmission line to connect Song Hau 1 and Song Hau 2 to the national grid system. It was referred to as the Song Hau-Duc Hoa line project.[45]

As of February 2024, Sông Hậu-2 was described as being in a "worrying situation" (Google translate), as the project had not yet been allocated capital and was at risk of being terminated by Ministry of Industry and Trade at the end of June 2024 in accordance with PDP8.[46]

Sông Hậu-3

The proposed 2,000-MW Sông Hậu-3 apparently does not yet have a developer. In October 2013, Samsung expressed interest in the project, among others in Vietnam.[47] In 2014, Korea Electric Power Corporation (KEPCO) expressed interest in the project, and began studying its feasibility in May.[48][49] The project was announced as cancelled in the 2016 PDP7 (see below).

Financing

Sông Hậu-1

At the end of 2016, it was reported in the financial press that overall funding of US$1.2 billion had been secured. Korea Trade Insurance Corporation (K-Sure) and Korea Export-Import Bank (Kexim) will jointly provide financing of US$987 million alongside a consortium of nine international commercial banks who will provide a further US$213 million 10-year syndicated loan.[50] These nine banks include Citibank, Cathay United Bank, DBS Bank, Sumitomo Mitsui Banking Corporation, DZ Bank, Credit Agricole, Mizuho Bank and OCBC Bank.[51][51][51][50]

Sông Hậu-2

In January 2023, IJ Global wrote that Toyo Ink targets to arrange $2.4billion syndicated financing facilities with a debt/equity ratio of around 75.25. Export-Import Bank of Malaysia was signed up in November 2022 as the MLA, bookrunner and arranger for the project's debt financing.[39][42]

In May 2023, Song Hau 2 Power Company Limited (a subsidiary of Toyo Ink) reportedly received Indicative Principal Terms and Conditions for the syndicated loan.[52]

In August 2023, financial close was expected by September or October.[53] As of September 7, financial close was pending, according to one media report.[54]

In November 2023, Toyo Ink reportedly received a letter of authorization from Export-Import Bank of Malaysia, lead arranger for the 2.42 billion USD syndicated loan.[55] In the same month, Toyo Ventures announced that it had received a letter from Vietnam’s Ministry of Industry and Trade granting an extension period until June 30, 2024 to make financial arrangements for this thermal power project.[56]

As of March 2024, financial close of the syndicated transaction appeared to not have taken place yet.

Sông Hậu 2 Industrial Park

In November 2023, Kinh Bac Urban Development Corporation approved the development of a 5,570 billion VND "Song Hau Industrial Park 2 Technical Infrastructure Investment and Construction Project" (Google translate). The 380 hectare area would be constructed to be subleased for various industrial uses and would reportedly employ 20,000 people. Investment planning would be ongoing through December 2023, and construction was slated to take place between July 2025 and December 2026. The industrial park would be adjacent to Sông Hậu-2 Thermal Power Plant.[57]

Revised Power Development Plan VII

According to PDP7, released in 2016, Phase I is in construction with completion scheduled for 2019, Phase II is scheduled for completion in 2021 and 2022, and Phase III is cancelled.[58]

Just Energy Transition Partnership

In December 2022, Vietnam and a coalition of countries led by the European Union and the UK concluded a Just Energy Transition Partnership agreement with US$15.5 billion to fund the development and implementation of a plan to cap and then phase out unabated coal generation. The agreement proposed reducing Vietnam’s coal fleet capacity from 37 GW to 30.2 GW by 2030 and a path to “phasing out unabated coal-fired power generation after those dates.” As of January 2023, the Global Coal Plant Tracker estimated Vietnam had 24.7 GW in coal capacity, with a further 6.1 GW under construction. The deal noted a detailed plan would be finalized by November 2023 to guide the long-term transition plan.[59][60][61]

Articles and Resources

References

  1. Starting to Build Infrastructure of Song Hau 1 Power Center in the End of April 2010, CTTE Corp. website, April 16, 2010.
  2. "JICA To Drive Forward $1.5bn Power Project", Business Times, Feb. 15, 2011.
  3. Ministry of Industry and Trade works at Song Hau Power Project, Petrovietnam press release, 12 Sept. 2014.
  4. New 2000 MW Coal-Fired Power Plant to be Developed in Vietnam, Energy Global, Feb. 8, 2013.
  5. Signing EPC Contract of Song Hau 1 thermal power plant, Vietnam Energy, 13 Apr. 2015.
  6. Prime Minister Nguyen Tan Dzung issues order for construction start of Song Hau 1 Thermal Power Plant, Petrovietnam press release, 19 May 2015.
  7. Dự án nhiệt điện Sông Hậu 1: Lắp đặt thành công dầm chính lò hơi tổ máy số 2, Lilama website, 3 May 2017.
  8. Nhà máy nhiệt điện Sông Hậu 1:PVN cần minh bạch trong quá trình xét thầu!, Bao Moi, 16 Jan. 2017.
  9. Vụ nhà máy Nhiệt điện sông Hậu 1: Cần tránh'vết xe đổ' của các dự án lỗ nghìn tỷ, Bao Moi, 3 Apr. 2017.
  10. Turbines installed at Song Hau 1 thermal power project, Vietnam+, Nov. 13, 2018
  11. PMU of Song Hau 1 Joint Stock Company 1: Complete the key plans for 2018, Petro Times, Jan. 4, 2019
  12. Implementation of Power Projects in the Revised Power Development Plan 7, Ministry of Industry and Trade, Republic of Vietnam, Jun. 4, 2019
  13. 13.0 13.1 Nhiệt điện Sông Hậu 1 gặp khó khi về đích, Tin Tuc, Aug. 29, 2019
  14. Tổ máy 1 Nhiệt điện Sông Hậu 1 hòa lưới điện quốc gia, Nang Luong Vietnam, Nov. 27, 2020
  15. Unit 2 of Song Hau 1 Thermal Power Plant is connected to the national grid, Báo Nhân Dân, Jan. 27, 2021
  16. NMNĐ Sông Hậu 1: Đảm bảo tiến độ, an toàn thi công trong mùa dịch, PetroTimes, May 12, 2021
  17. PVN hoàn thành tổ máy 1 Nhà máy nhiệt điện Sông Hậu 1, Thanh Nien, Nov. 28, 2021
  18. [https://vietnamnews.vn/economy/823434/unit-1-of-song-hau-1-thermal-power-plant-connects-to-the-500kv-national-power-system.html Viet Nam News Economy Unit 1 of Song Hau 1 thermal power plant connects to the 500kV national power system], Vietnam News, Nov. 27, 2021
  19. “Draft National Power Development Plan VIII,” MOIT, July 4, 2022
  20. $2-billion Song Hau 1 thermal power plant inaugurated, Vietnam Investment Review, July 19, 2022
  21. Ký kết Hợp đồng cung cấp than cho Nhà máy Nhiệt điện Sông Hậu 1, Kiểm toán, August 18, 2023
  22. Toyo Ink Group Berhad Update on Progress of the Proposed Investment Project of Building a Coal-Fired Thermo Power Plant in Vietnam, Toyo Ink Group Berhad press release, Apr. 29, 2011.
  23. Contract for New Vietnam Thermal-Power Plant Signed, talkvietnam, Jan. 12, 2012.
  24. BOT power plant agreed, Vietnam Investment Review, 5 Aug. 2013.
  25. Toyo Ink expects to pay US$35mil for consultancy services, Malaysia Star, 9 July 2015.
  26. Dự án BOT Nhà máy nhiệt điện Sông Hậu 2: Điều chỉnh mốc thời gian thực hiện giải phóng mặt bằng, Bao Hau Giang, 26 Oct. 2016.
  27. "Toyo Ink’s hunt for partners in power venture at tail end," The Edge Markets, September 11, 2017
  28. "Song Hau 2 coal-fired environmental impact approved," IJ Global, 07 February 2018
  29. Miền Nam thiếu điện nhưng các dự án nhiệt điện vẫn 'không vội được đâu', Dai Doan Ket, 24 Mar. 2017.
  30. "Đẩy nhanh tiến độ dự án BOT Nhiệt điện sông Hậu 2," ĐẤU THẦU, 28 November 2017
  31. Toyo Ink looks to a better FY19, The Edge Markets, Sep. 7, 2018
  32. Implementation of Power Projects in the Revised Power Development Plan 7, Ministry of Industry and Trade, Republic of Vietnam, Jun. 4, 2019
  33. Tình hình thực hiện các dự án điện theo hình thức BOT ở Việt Nam, Feb. 14, 2020
  34. Ahmad Naqib Idris, Toyo Ventures executes US$3.23b Vietnam power plant contract after 12-year wait, The Edge Markets, Dec. 29, 2020
  35. Toyo partners with CEEIC for Vietnam coal-fired, IJGlobal, Jan. 25, 2021
  36. Đẩy nhanh giải phóng mặt bằng dự án Nhà máy Nhiệt điện Sông Hậu 2, Vietnam+, May 24, 2021
  37. Trung Chanh, 18 dự án nhiệt điện than trong quy hoạch khó tiếp cận vốn, The Saigon Times, Oct. 3, 2021
  38. Vietnam: BOT Projects--The Path To Closure In Vietnam, Mondaq, Jun. 9, 2022
  39. 39.0 39.1 "Song Hau 2 Coal-Fired Power Plant (2.12GW)". www.ijglobal.com. January 2023.{{cite web}}: CS1 maint: url-status (link)
  40. Làm việc với nhà đầu tư dự án Nhà máy Nhiệt điện Sông Hậu 2, Hau Giang, Feb. 14, 2023
  41. Dự án Tái định cư Mái Dầm – Nhà máy Nhiệt điện Sông Hậu 2 – Thực hư ra sao?, Bat Dong San Tay Nam Bo, Feb. 21, 2023
  42. 42.0 42.1 Renewed interest in Toyo Ventures as it kickstarts power plant project, The Edge Malaysia, March 10, 2023
  43. Approving the national electricity development plan for the period of 2021-2030, with a vision to 2050, Prime Minister of Vietnam, May 16, 2023
  44. Báo cáo nhanh CTCP Tư Vấn Xây Dựng Điện 2 (TV2 - HSX), Chứng khoán Kiến Thiết Việt Nam, December 13, 2023
  45. Đóng điện 3 công trình truyền tải điện lớn, cấp điện cho miền Nam, Công an Thành phố Đà Nẵng, January 1, 2024
  46. Vắng bóng dự án BOT nguồn điện, TheLEADER.vn, February 23, 2024
  47. International Giants Interested in Power Projects in Vietnam, VietNamNet, Oct. 13, 2013.
  48. RoK group interested in Hau Giang’s thermal power plant, Vietnam+, 20 Aug. 2014.
  49. Korea Electric Power Corperation to study and survey investment opportunities into Song Hau 3 thermal power plant, Hau Giang Provincial Government press release, 22 July 2014.
  50. 50.0 50.1 Song Hau 1 Coal-Fired Power Plant (1200MW), IJGlobal, 5 Dec 2016.
  51. 51.0 51.1 51.2 "Signing the credit and commercial loan contracts for Song Hau 1 Thermal Power Project". nangluongvietnam. Retrieved 2020-09-24.{{cite web}}: CS1 maint: url-status (link)
  52. "TOYO VENTURES HOLDINGS BERHAD ANNOUNCEMENT". malaysiastock.biz. May 12, 2023.{{cite web}}: CS1 maint: url-status (link)
  53. "RHB Research expects better earnings for Sunway Construction in 2Q". www.nst.com.my. August 9, 2023.{{cite web}}: CS1 maint: url-status (link)
  54. "Post-elections stability to benefit construction sector, says RHB IB". www.freemalaysiatoday.com. September 7, 2023.{{cite web}}: CS1 maint: url-status (link)
  55. Nhà máy Nhiệt điện Sông Hậu 2 có thể được cấp khoản vay hợp vốn tới 2,42 tỷ USD, vietnambiz, November 29, 2023
  56. "Malaysia Exim Bank to arrange $2.42 bln for southern Vietnam thermal power project". theinvestor.vn. November 2023.{{cite web}}: CS1 maint: url-status (link)
  57. Hậu Giang: KBC duyệt chi gần 5.570 tỷ đồng đầu tư vào Khu công nghiệp Sông Hậu 2, Báo điện tử Xây dựng, November 3, 2023
  58. DANH MỤC CÁC DỰ ÁN NGUỒN ĐIỆN VÀO VẬN HÀNH GIAI ĐOẠN 2016 - 2030, Ban hành kèm theo Quyết định số 428/QĐ-TTg ngày 18 tháng 3 năm 2016 của Thủ tướng Chính phủ (LIST OF POWER PROJECT IN OPERATION PERIOD 2016 - 2030, Issued together with Decision No. 428 / QD - TTg of March 18, 2016 by the Prime Minister)
  59. Viewpoint: Cautious outlook for Vietnam’s coal imports, Argus Media, December 20, 2022
  60. Political declaration on establishing the Just Energy Transition Partnership with Viet Nam, Governments of the Socialist Republic of Viet Nam, & International Partners Group, December 14, 2022
  61. Unpacked: Vietnam’s US$15.5 Billion JETP Agreement, Vietnam Briefing, December 19, 2022

Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.