France provides major funding to Vietnam for new transmission line

A loan agreement of EUR75 million was recently signed between France and Vietnam for the Pleiku-Cau Bong transmission line .

This signature marks a new and important stage in France’s commitment to support the economic development of Vietnam, through the strengthening of its electricity network.

The project’s high-voltage (500kV) electric transmission line will connect Pleiku to Cau Bong, on a 437 km route crossing five provinces. Of strategic importance, this line will allow transmission of electricity from the Central region, where power production units are concentrated, to the South of the country, where the energy deficit has been growing due to high demand for electricity in Ho Chi Minh City metropolitan area. The project is cofinanced by the AFD and the Asian Development Bank (ADB).

The investments should increase the maximum power transmission capacity between the Central and the South of the country from 2,500 MW to 5,300 MW, and consequently to ease the burden on power plants in the South using coal or imported gas. It will also allow improving revenues of the EVN group through reduction of technical losses on the network and optimization of available and forecasted production capacities. The line operation is planned in 2015, and the project will allow the future importation of electricity from hydropower plants of Laos and Cambodia, which should be in operation in 2018.

Since 2000, the French Development Agency (Agence française de Développement AFD), has committed EUR210 million to support the production, transmission and supply of electricity in Vietnam through financing the hydropower plant of Huoi Quang, high-voltage lines in the North, as well as rural electrification in the Mekong delta. Those projects allowed the construction of 675 km of transmission lines, 6,000 km of supply lines and the connection of 110,000 new households.

In the 2013-2015 strategy in Vietnam, the AFD confirmed its intention to support the modernization of the electricity sector to make it fairer and more sustainable.