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Home › Dodgy Deals ›
Dodgy Deal
Nam Dinh coal power plantVietnam

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Contact:

climate@banktrack.org

Last update: 2020-08-13 12:46:37
Blueprint of the Nam Dinh coal power plant in Nam Định province, Vietnam. Photo: globalconstructionreview.com

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Contact:

climate@banktrack.org

Last update: 2020-08-13 12:46:37
Why this profile?

Why this profile?

The planned Nam Dinh coal power plant will negatively impact local people and the environment. Local populations are already being relocated and livelihoods are being threatened. A new coal power plant will also increase the health risks that the Vietnamese population is already facing. In terms of the environment, the new coal power plant will worsen climate change and contribute to already existing air pollution. The plant is also expected to use incredible amounts of water and threaten local aquatic life.

What must happen

The Paris Climate Agreement goals require a managed decline of fossil fuel production. The construction of new coal-fired power plants is not compatible with this goal. Banks must immediately stop financing new coal-fired power plant developments anywhere in the world. As such no financial institution should finance the Nam Dinh power plant.

About
Sectors Coal Electric Power Generation
Location
Status
Planning
Design
Agreement
Construction
Operation
Closure
Decommission
Website http://www.tk-p.com/eng/business/vietnam.php

The Nam Dinh power station is a proposed 1,200MW coal power plant in the Hai Hau district, Nam Dinh province, Vietnam. Construction for four units, 600MW each, was targetted to begin in 2014 but was delayed. In 2016 two units were cancelled and the completion of the two remaining units was scheduled for 2020 and 2021. Commission dates are now scheduled for 2025, and Global Energy Monitor reports that site preparation work has begun.

The project sponsor is Nam Dinh First Power Company Limited, a joint venture between Saudi Arabian ACWA Power and the South-Korean conglomerate Taekwang Power. The construction will be carried out by South-Korean POSCO E&C. The project sponsor has entered a Build, Operate and Transfer (BOT) contract with the government of Vietnam. After the concession ends in 25 years, the project will be handed over to the government. The required coal will come from the Red River coal basin - Vietnam's largest coal deposit, with reserves of 236 million tonnes, located in neighbouring Thái Bình province -  and will be supplied by Vinacomin, a Vietnamese government-owned coal mine company.

Impacts

Social and human rights impacts

In order to create the Nam Dinh power station about 300 households are being relocated and will only receive minimal compensation.

Local livelihoods will be impacted through the effects of the construction and operation of the plant. Farming land and aquaculture will be impacted across the plant’s coal ash area. Local aquaculture will likely be impacted during operation due to the discharge of waste. These communities were already impacted by the Formosa environmental disaster in 2016, which killed sea life along a 200 kilometer coastline and incited many environmental protests. Community members are worried the Nam Dinh power plant will destroy life in the Ninh Co river.

Existing coal-fired power plants already pose significant health risks for Vietnamese citizens, the Nam Dinh power station will worsen these health impacts. A 2017 study by Harvard University has estimated that air pollution from similar existing plants is responsible for 4,300 premature deaths in 2011. This number is expected to rise to 21,100 by 2030 if the scheduled new coal power plants are built in Vietnam. The health risks are higher for children, the pollution from carbon dioxide, mercury and arsenic can lead to lung injuries, nerve diseases and cardiovascular infections.


Environmental and climate impacts

The Vietnamese government announced in 2016 it would drop plans for further coal-fired power plants, after a commitment to limit Vietnam’s contribution to climate change. Unfortunately the government has failed to follow through, and in fact Vietnam is planning to start exploiting the Red River coal basin to provide coal for the Nam Dinh plant. The Vietnam Sustainable Energy Alliance (VSEA) has, in cooperation with the WWF, published a study according to which Vietnam can supply 100% of its electricity demand from renewable energy, proving that there is no need for the plant in the first place.

The plant will contribute to already existing air pollution both during construction and operation phases. The plant will emit fine dust, CO2, SO2 and NOx. Material transport will add to this pollution.

The plant will likely also cause water problems as it takes an incredible amount of water to construct and operate the plant. The water will be used for cooling and the heated water will likely be released into the Ninh Co river, which the plant is located on (7km upstream from the coast), where the temperature difference will be highly detrimental for aquatic life.

The project's Environmental Impact Assessment (EIA) was passed in 2012 and is potentially out of date. Even a more recent EIA could be unreliable as the methodology for drafting EIAs in Vietnam is flawed and the Vietnamese minister for Resources and Environment, Hong Ha, has called the current regulation unfeasible.

Financiers

The project sponsors will finance the USD 2.5 billion project through a 76:24 debt to equity ratio. In January 2020, IJGlobal reported that a group of 5 Chinese banks will together provide USD 1.9 billion debt financing of the Nam Dinh power plant (source: IJGlobal). The debt financing has a tenor of around 20 years. Taekwang Power Holdings and ACWA Power will both provide USD 300 million in equity financing.

Institution type
Finance type
Year
Companies

Taekwang Power Holdings and ACWA Power are the project sponsors of Nam Dinh coal power plant. ACWA Power has signed an EPC (Engineering, Procurement and Construction) contract with China Gezhouba Group.

ACWA Power

Saudi Arabia
Website

China Gezhouba Group

China
Website
ACWA Power has signed an EPC contract with China Gezhouba Group International

Taekwang Power Holdings

South Korea
Website
Parent company of the BOT company

Vietnam Electricity (EVN)

Vietnam
Website
No companies
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Will Vietnam’s new energy policy mark a turning point for coal?

2020-07-22 | Eco-Business
BankTrack news BankTrack blog Partner news Partner blog

Nam Dinh 1 signs Sinosure-backed loan

2020-01-08 | Proximo
BankTrack news BankTrack blog Partner news Partner blog

Leading NGOs urge Vietnam to scrap new coal-fired power projects

2020-01-02 | VN Express
Blog
BankTrack news BankTrack blog Partner news Partner blog

Major banks are failing Vietnam by violating Equator Principles commitments in financing coal power projects

2018-10-11 | Market Forces
Blog
BankTrack news BankTrack blog Partner news Partner blog

HSBC and Standard Chartered accused of “rank hypocrisy” for financing of highly polluting coal projects whilst publicly supporting Paris Climate Agreement

Two major British banks are helping to finance coal-fired power stations that will emit more carbon dioxide than the annual emissions of 69% of the world’s countries, a new Global Witness report reveals
2018-07-23 | London | Global Witness
BankTrack news BankTrack blog Partner news Partner blog

Coal turns up heat on Standard Chartered

2018-07-23 | The Times
BankTrack news BankTrack blog Partner news Partner blog

Power plants win vital waste grounds

2018-06-09 | Vietnam.Net
BankTrack news BankTrack blog Partner news Partner blog

Vietnam continues to develop coal-fired power despite environmental risks

2018-02-05 | Vietnam.Net
Blog
BankTrack news BankTrack blog Partner news Partner blog

Singaporean banks blowing smoke on climate

2018-01-10 | Melbourne | Market Forces
BankTrack news BankTrack blog Partner news Partner blog

Too Coal-Hearted: Japan and Korea’s Support for Dirty Energy

2017-11-13 | NRDC
Blog
BankTrack news BankTrack blog Partner news Partner blog

More black marks for coal-hungry UK banks in latest Report Card

Barclays and HSBC increased finance for coal power in 2016, despite claims to support Paris Agreement
2017-07-10 | Greig Aitken – BankTrack
BankTrack news BankTrack blog Partner news Partner blog

ACWA Power and Taekwang Power Holdings granted Investment Registration Certificate for Nam Dinh 1 Thermal Power Project

2017-07-03 | ACWA Power
BankTrack news BankTrack blog Partner news Partner blog

Financial close in 2017 for Nam Dinh 1 coal-fired

2017-03-07 | IJ Global
BankTrack news BankTrack blog Partner news Partner blog

Comment: Vietnam’s coal decision is the Paris Agreement in action

2016-01-15 | Unearthed
BankTrack news BankTrack blog Partner news Partner blog

Saudi’s ACWA Signs USD 2bn Deal To Develop Power Plant In Vietnam

2014-06-19 | Gulf Business
BankTrack news BankTrack blog Partner news Partner blog

ACWA Power signs Joint Development Agreement with Taekwang Power Holdings from Korea for the Nam Dinh 1 Coal Fired power project in Vietnam

2014-06-18 | Zawya
BankTrack news BankTrack blog Partner news Partner blog

USD 4.5bn thermal plant takes shape

2013-12-17 | Vietnamnews
Resources
Documents
Links
2016-06-30 00:00:00

Synthesis Report on Socio-environmental Impacts of Coal and Coal-fired Power Plants in Vietnam

NGO document
2016-06-30 00:00:00 | GreenID
2017-03-15 00:00:00

Burden of Disease from Rising Coal-Fired Power Plant Emissions in Southeast Asia

NGO document
2017-03-15 00:00:00 | Environmental Science & Technology

Nam Dinh profile on Market Forces

Nam Dinh Power Station on Global Energy Monitor

Updates

2020

2020-02-14 00:00:00 | Nam Dinh Unit 1 to be commissioned in Q1 2025, Unit 2 in Q3 2025

In February 2020, the Vietnamese National Steering Committee for Power Development reported that Unit 1 is scheduled to be commissioned in Q1 2025 and Unit 2 in Q3 2025.

2020-01-08 00:00:00 | Details on project finance

On January 8th 2020, IJGlobal published more detailed information on the debt package that was signed in December 2019. The lenders to the project are:

  • Bank of China
  • China Construction Bank
  • Export-Import Bank of China
  • China Development Bank
  • China Minsheng Bank

More details can be found in the financiers section of this profile.

2019

2019-12-18 00:00:00 | Debt package signed

On December 18th 2019, the debt package for the Nam Dinh coal power plant was signed according to IJGlobal.

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