Vietnam has significant solar and wind energy potential, creating ideal conditions for green hydrogen production. Japanese investors are seeking opportunities to collaborate on hydrogen projects in Vietnam.
Vietnamese and Japanese businesses and experts discussed at the Vietnam-Japan Hydrogen 2024 seminar.
On September 17, during the Vietnam-Japan Hydrogen 2024 seminar held in Ho Chi Minh City, Mr. Nobuyuki Matsumoto, Chief Representative of JETRO's Ho Chi Minh City office, stated that, like Vietnam, the Japanese government is committed to achieving carbon neutrality by 2050.
Government support for business transition
To achieve this goal, Japan has been actively expanding carbon-free energy sources, replacing electricity in industries, consumer sectors, and transportation with non-carbon electricity, and promoting the use of hydrogen, ammonia, methane, and synthetic fuels for heat generation, alongside other decarbonization initiatives.
The Japanese government established a Green Growth Strategy in 2020, designating hydrogen and ammonia as key sectors. A Green Innovation Fund, worth approximately 2 trillion yen (equivalent to $13 billion USD), was set up for 2021. In May 2023, the GX Promotion Act was enacted to stimulate private investment, pushing for comprehensive strategies to reduce greenhouse gas emissions, ensure energy security, and shift industrial and social structures, including lifestyle and business practices.
Furthermore, in May 2024, Japan passed the Hydrogen Society Promotion Act, aiming to strongly promote the adoption of hydrogen in practical applications. This program evaluates company plans to implement and use hydrogen, providing support to approved companies.
Japan's long-term strategy focuses on carbon-free electricity generation, with plans to integrate hydrogen and ammonia technologies into thermal power plants. A pilot project at a 1GW thermal power plant began in April and was completed in June of this year. Hydrogen and ammonia combustion technologies are expected to be commercialized by the 2030s, according to Nobuyuki Matsumoto.
Vietnam’s Hydrogen Energy Development Strategy
The seminar attracted investors and developers from both Japan and Vietnam in the fields of infrastructure and energy. They shared information on project development experiences and assessed the potential for hydrogen energy development in Vietnam, identifying opportunities for participation in new energy trends in both private and public sectors.
Le Ngoc Anh Minh, President of the Vietnam ASEAN Hydrogen Club (VAHC), noted that in recent years, selling electricity from renewable energy projects such as wind and solar has faced some challenges. With Japan's support, VAHC was established in March 2023, engaging stakeholders to raise awareness of hydrogen energy.
The members of the club include experts in renewable energy, heavy industry, and energy market analysis.
According to Vietnam's Hydrogen Energy Development Strategy to 2030, with a vision to 2050, approved by the government, hydrogen energy development is linked to renewable energy. By 2050, Vietnam aims to accelerate the use of green hydrogen and hydrogen-based fuels in all energy-using sectors to decarbonize the economy and contribute to the goal of achieving net-zero emissions by 2050.
To accompany this strategy, the Vietnamese government has introduced various incentives, including tax breaks, green finance, and land lease discounts for hydrogen energy projects that meet specific standards.
According to the International Energy Agency (IEA), global demand for hydrogen and other fuels is expected to increase fivefold by 2050 compared to 2022, with applications in sectors such as low-emission steel production, on-site energy production, and transportation, including cars, trucks, and power generation. However, hydrogen is currently much more expensive than fossil fuels, making government involvement, alongside private and allied sectors, crucial.
