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Vietnam’s offshore wind potential is drawing strong interest. (Photo: iStock)
The Vietnamese government is accelerating the deployment of offshore wind. The Ministry of Industry and Trade (MOIT) has announced the price cap for offshore wind procurement and is optimistic that the country’s first wind farm could start construction by the end of 2025.
The Global Wind Energy Council (GWEC) also sees Vietnam as one of the most promising emerging offshore wind markets in Asia, following regulatory and policy reforms.
The World Bank estimates that Vietnam’s offshore wind market could be worth up to USD 60 billion, with capacity capable of meeting 12% of the country’s total electricity demand by 2035. However, Bruno Jaspaert, chairman of EuroCharm, noted that offshore wind projects usually require six to seven years of development. Whether construction can begin before 2027 will be critical to meet the government’s targets.
With Vietnam accelerating its offshore wind ambitions, the focus now turns to the incentives and policies in place, the companies already moving into the market, and the risk that supply chain players must carefully assess before making any commitments.
Vietnam fast-tracks offshore wind with new regulations, subsidies
In terms of policy, Vietnam finalized its revised Power Development Plan 8 (PDP8) in April, reinstating offshore wind into the national power structure after it had previously been considered for removal. The plan also increases the share of nearshore and onshore wind, as well as solar power, in the country’s energy mix. In addition, Vietnam is actively exploring the feasibility of nuclear energy. These developments underscore the government’s policy direction to meet rising electricity demand through a low-carbon energy transition.
Read more: Vietnam approves $136 billion power plan to expand renewables, nuclear energy
According to local press, MOIT initially proposed delaying offshore wind development until after 2030 due to high capital costs, a lack of concrete investment plans, and uncertainties over project execution. However, the proposal was ultimately rejected. The finalized PDP8 set ambitious targets, aiming for up to 17,000 MW of installed capacity by 2030 and a significant increase to 139,079 MW by 2050.
The Vietnamese government introduced new regulations in March to clarify the authorities responsible for managing offshore wind development. Under the new framework, the Ministry of Agriculture and Environment (MOAE) will assist with site survey, while MOIT will oversee project auctions.
The regulations also outline several incentive measures, including reductions or exemptions on sea and land rental fees, a commitment to purchase at least 80% of project output, and an extension of power purchase agreement terms from twelve years to fifteen years.
In terms of foreign investment, Vietnam requires the participation of domestic companies, with a minimum equity stake of 5%. If state-owned companies need to bring in foreign investors for technology or capital reasons, they may form joint ventures without undergoing a bidding process. However, the foreign equity stake must not exceed 50%.
In 2024, MOIT emphasized that offshore wind projects should first be piloted by state-owned enterprises, with foreign participation to be considered only after further evaluation. However, policy easing in the first half of 2025 has helped boost confidence among international investors.
Nquyen Hoang Long, deputy minister of MOTI, said that offshore wind project submissions have increased markedly following the government’s decision to open the sector to greater private participation, adding that the country’s first offshore wind farm could potentially start construction by the end of 2025, although no specific project or investor has been identified.
Ho Chi Minh City set to lead on ports, supply chains
Ho Chi Minh City in southern Vietnam is considered a potential manufacturing hub for offshore wind equipment, particularly following its integration with the Cai Mep-Thi Vai deep-water port, which can accommodate heavy-lift vessels used to transport large components. Surrounding areas such as Phu My, Dong Xuyen and Long Son industrial zones also offer ample land and strong potential for further technology development.
In addition to infrastructure, Ho Chi Minh City is home to two of Vietnam’s leading offshore wind equipment suppliers, which are Petrovietnam and its subsidiary PTSC. The two companies have leveraged years of experience in offshore wind platform construction to expand into the development of underwater foundations.
Meanwhile, South Korean wind tower manufacturer CS Wind has been deeply rooted in the local market for over two decades and is now recognized as one of Vietnam’s leading manufactures in the sector.
Distribution of fixed and floating offshore wind development potential in Vietnam. (Image: World Bank)
In fact, Vietnam’s progress in onshore wind development has been ahead of schedule, laying a solid foundation for its emerging offshore wind sector. According to a report commissioned by the Royal Norwegian Embassy in Hanoi, nearly all key players across the supply chain, from underwater foundations to wind turbines, have expressed interest in entering the market. In addition to PTSC and CS Wind, global industry leaders such as Vestas and Siemens Gamesa have also outlined clear plans for participation.
Moreover, the Vietnamese government aims to export offshore wind power and has formed partnership with Malaysia’s Tenaga Nasional Berhad (TNB) and Petronas, as well as Singapore’s Sembcorp. The plan includes laying subsea cables to transmit offshore wind power from Vietnam to Singapore, a move expected to accelerate the development of the ASEAN Power Grid (APG).
Read more: ASEAN Summit: Singapore, Malaysia plan to import offshore wind from Vietnam
Over the past two years, Danish offshore wind developer Orsted and Norway’s Equinor have withdrawn from Vietnam’s offshore wind market, citing weak market prospect and an unclear regulatory framework. However, Germany’s PNE and Demark’s Copenhagen Infrastructure Partners (CIP) have maintained their original plans, waiting for the right timing. In the past year, increased activities from companies in China, the U.S., Japan and South Korea have also begun to emerge.
Nate Franklin, CEO of Pacifico Energy (PE), said that Vietnam’s long coastline and strong wind resources provide highly favorable conditions for developing wind power. As one of Vietnam’s key economic partners, the U.S. could see increased investment in Vietnam if PE’s projects progress successfully, helping to attract more US companies to the market.
Vietnam’s advanced onshore wind development lays a solid foundation for emerging offshore wind projects. (Image: iStock)
Policy and infrastructure gaps remain
Despite significant progress in offshore wind regulations, gaps remain. According to GWEC, the lack of a finalized bidding mechanism for Contracts for Difference (CfD), a transparent pricing framework, and backable power purchase agreements (PPAs) are the key barriers hindering industry development.
Zhang Ming-hui (張明輝), DNV’s APAC offshore wind segment lead, said that Vietnam could leverage its offshore oil and gas expertise to accelerate the development of infrastructure needed for offshore wind. However, he emphasized that the country must also upgrade and expand its grid to prevent curtailment issues from worsening as renewable energy generation increases.
Zhang, who has been involved in the development of numerous offshore wind projects, said that the supply chain in the Asia Pacific region remains underdeveloped and requires greater collaboration and resources sharing among contractors. As wind farms move further offshore, the ability to secure vessels and accurately forecast weather conditions will also be critical to the industry’s continued growth.
In a policy recommendation, the World Bank noted that for Vietnam to achieve its energy targets, the country must not only create a stable and attractive investment environment but also ensure a balanced role between state-owned and private companies. This also serves as a reminder for foreign investors that successfully entering Vietnam’s offshore wind market will likely require close attention to the country’s localization requirements to avoid potential setbacks.
Source: Baker McKenzie, GWEC, The Saigon Times, World Bank, The Investor, VIR
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