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Vietnam's authorities have awarded the first phase of a major wind power project to Vingroup's newly created subsidiary, VinEnergo, leaving German renewable firm PNE, backed by Morgan Stanley, out of the bid. PNE had planned a USD 4.6 billion investment and had been involved since 2019, conducting studies and wind tests, but faced unexpected financial guarantee demands. Vietnam aims to achieve 6,000 MW of offshore wind capacity by 2030-2035. The decision reflects a broader policy shift favoring domestic companies, while several Western wind firms have exited the country amid regulatory and pricing uncertainties.
Vietnamese authorities have chosen a newly established subsidiary of real estate conglomerate Vingroup to develop the first phase of one of the country's largest wind power projects, excluding German renewable energy firm PNE, which was backed by Morgan Stanley. The decision came as a surprise to PNE, which had been involved in the project for several years and had invested millions of dollars. Advertisement
PNE had planned to invest USD 4.6 billion in the 2,000-megawatt offshore wind project, recently reclassified as nearshore without significant changes to the original plan. Vietnam aims to achieve 6,000 MW of offshore wind capacity by 2030-2035 and up to 38,000 MW from onshore and nearshore projects. The Gia Lai province People's Committee approved Vingroup's VinEnergo bid for the first 750-MW phase with an investment of 48.3 trillion dong (USD 1.87 billion), while PNE and another Vietnamese bidder were not selected. PNE expressed surprise over the decision and said it was reviewing the reasoning before deciding its next steps.
PNE has been working on the project since 2019, carrying out feasibility studies and wind tests. Sources familiar with the project noted that the firm had invested millions of dollars and faced unexpected demands from authorities regarding financial guarantees, including instructions to preemptively deposit investment funds in Vietnamese accounts. Morgan Stanley Infrastructure holds a majority stake in PNE, which has established a local office and signed an MoU with Vietnamese authorities on electricity pricing.
Vingroup, Vietnam's largest company by market capitalization, has been expanding rapidly under supportive government policies. While its core business is real estate, it has branched into sectors including tourism, education, healthcare, railways, steel, energy, entertainment, space, and electric vehicles through its Nasdaq-listed company VinFast. VinEnergo, founded in March, has not previously developed any wind farms but has already won projects in other provinces.
Vietnam has seen multiple Western wind companies exit the country recently, including Norway's Equinor, Denmark's Orsted, and Italy's Enel. The country's top leadership is promoting a growth model that favors national champions, which has sometimes caused friction with foreign investors who have historically driven much of Vietnam's economic development. Despite surging foreign investment, rising electricity demand occasionally results in blackouts, leading the country to rely on coal generation even as it aims to reduce fossil fuel use.
Source PTI
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